iWoz is Steve Wozniak's memoir, written with Gina Smith. One of the two co-founders at Apple, it is hard to understand what a pure engineer this man was and is without reading this book.
The book itself is well-written, with a light-weight reading style that's clearly designed to make non-technical readers comfortable. (Ironically, I wish he had chosen to keep the technical parts more technical because it would have made those sections of the book easier for me to read)
The early part of the book is easy reading, about Wozniak's early days in school, and how he met Steve Jobs and Captain Crunch and got into making Blue Boxes. His light-heartedness and spirited playfulness comes through in his pranks, and the man has not a single bit of malice at all in his body, not even when Steve Jobs screwed him over:
The whole thing used forty-five chips, and Steve paid me half the seven hundred bucks he said they paid him for it. (They were paying us based on how few chips I could do it in.) Later I found out he got paid a bit more for it --- like a few thousand dollars --- than he said at the time...
The important part of the book, about the Apple and the Apple II are very much worth reading. He really sets the record straight (e.g., he was the sole designer of the Apple and the Apple II, rather than it being a collaboration between him and Jobs). He also designed Apple's floppy drive in 2 weeks, and that included writing all the firmware for it. Make no mistake, this man was an engineer's engineer: he could design, prototype, solder, and then write the BASIC interpreter for one of the first personal computers, and still have time left over for a prank that no one could pin on him at a trade show.
Yet this man was more unworldly than a monk:
...this idea popped into my mind about two guys who die on the same day. One guy is really successful, and he's spending all his time running companies, managing them, making sure they are profitable, and making sales goals all the time. And the other guy, all he does is lounge around, doesn't have much money, really likes to tell jokes and follow gadgets and technology and other things he finds interesting in the world, and he just spends his life laughing...
Wozniak leaves you no doubt in your mind as to which person he is.
Yet a hundred pages down the road, you find the limitations of this mind-set:
During the time the Apple III was being developed, he thought we'd grown a bit too large. There were good engineers, sure, but there were a lot of lousy engineers floating around. That happens in any big company.
I can't imagine a single startup founder today taking that attitude. Not after Larry Page and Sergey Brin have shown that even at an incredible size, employee hiring is still something that you must spend time doing and worrying about, and that it is possible to keep standards incredibly high despite becoming very big. Today, Apple has a reputation for being an incredibly frustrating place for engineers to work at (even my friend the iPhone touch screen custom chip designer will admit that). But it does not have to be that way, and to a large extent, I think the fact that the engineering co-founder did not take an active management role has a lot to do with it. (An interesting note: Wayne Rosing, Google's first Senior VP of Engineering has a cameo role in the book as Wozniak's bosses boss. Rosing was instrumental in setting up Google's engineering culture, and is easily one of the smartest engineering managers I've ever had the pleasure of working with/under.)
The book ends with a chapter of Wozniak's advice to engineers. It is excellent advice. For instance:
If you're that rare engineer who's an inventor and also an artist, I'm going to give you some advice that might be hard to take. That advice is:Work alone.
There it is from the horse's mouth. Do not believe all those journalists who tell you that in this modern age, you need to work with lots of people to do anything significant. All good software is designed by one person working by himself. That is as true now as it was when Wozniak wrote Apple Integer BASIC.
When Wozniak visited Google, I got to ask him if he had any regrets about Apple. He gave me the ultimate engineer's answer: I wish we'd sprung for a better keyboard on the Apple II. A great guy, and this book's a great read. Highly recommended.
Saturday, December 01, 2007
Thursday, November 29, 2007
My Culinary Internship
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| Culinary Internship |
One of the perks at Google is that if you like the food enough (and trust me, you will!), you can volunteer for a Culinary Internship at one of the cafes. (Yes, you get to choose which one) I've been a big fan of Jeff Freburg's Cafe-5IVE for as long as it's been open, so when the time came, I chose that Cafe.
Being a kitchen newbie, I only had to work half a shift. So I reported to Jeff at 8:30, and after we discussed what was going on, I was assigned to help Kristen with the pastries. Under Kristen's direction, I zested some lemons, then mixed huckleberry, lemon juice, and agave to make huckleberry sauce for the souffle. I then put the sauce on the souffles and racked it in preparation for lunch. I then helped put together the soup for the pineapple dessert cups, scooped ice cream, and loaded the cookie jars (a dream job, if you ask me!).
After that, I got reassigned to the hot line, and helped make some vegan cheese, started heating some cream for tomorrow's macaroni and cheese, and generally got in the way while Fish and Chips were being fried. Then I stood behind the soup station and served visitors for an hour before the rest of my group caught up with me and I took lunch with them.
This was definitely a highlight of my career at Google. I really got to appreciate how hard the kitchen staff worked --- I didn't get to sit down from 8:30 to 12:30, and I was amazed by how hot the kitchen got, and how much got done in so little time. Yet the staff stayed calm, as though they did it every day --- which of course they did! And the equipment. Sure, million dollar data centers are cool, but $100k ovens have an immediate, direct, visceral feel to them that just yell "COOL!"
And of course, nothing beat the satisfaction of having Chef Freburg come to me afterwards and invite me back to the kitchen any time. I'll definitely take him up on it!
Sunday, November 25, 2007
Review: The Trouble with Islam Today
I met Irshard Manji when she visited Google to give a talk. She seemed to be a very brave woman with a major goal, which is to bring about a Reformation, as it were, to modern Islam. As others have pointed out, the kind of reformation that she espouses is a requirement before the many Islamic cultures in the middle east can begin to consider having a successful economy or development beyond what has turned out to be The Curse of Oil in the recent century.
Manji points out that there was a period of time in the Islamic empire when open discussion and questioning of tradition was welcome --- during which ijtihad flourished. The period was relatively short (about 500 years or so) before the Islamic empire collapsed and Islam (or perhaps just the middle-eastern variant) retreated back towards tribal traditions and the desert.
She further points out that both the United States and Israel, whom many Arabic Muslims blame for their humiliation, both tolerate and support dissent within their countries --- it is the Arabic countries that do not have a free press. All through the book, her pleas are impassioned (especially her complaint about Foundamentalism, the Arabic view of Islam being held supreme over other views), and her history well-researched. In person, I asked her why she thought fundamentalism had become more popular throughout the world, not just in troubled countries. Her response was a very straightforward, "Globalism. When the world becomes smaller, you lose what you think you used to have, and you try very hard to cling to traditions which you think you might be losing." I would have appreciated further development of that theme, but did not find that in this book.
All in all, I'm convinced that a Reformation of some kind is necessary before the middle east can make progress. I am not sure what form it will take, however, and perhaps a little disappointed that Manji ultimately veers away what I consider would be the ultimate destination of her religious exploration, which is secular humanism, a philosophy that is more fruitful and less condemning of human reason than even a reformed Islam would be. But ultimately, that is a religious choice, and as it is, I would not want to condemn her for standing out there in the face of death-threats --- in her position I would probably not be as brave!
Manji points out that there was a period of time in the Islamic empire when open discussion and questioning of tradition was welcome --- during which ijtihad flourished. The period was relatively short (about 500 years or so) before the Islamic empire collapsed and Islam (or perhaps just the middle-eastern variant) retreated back towards tribal traditions and the desert.
She further points out that both the United States and Israel, whom many Arabic Muslims blame for their humiliation, both tolerate and support dissent within their countries --- it is the Arabic countries that do not have a free press. All through the book, her pleas are impassioned (especially her complaint about Foundamentalism, the Arabic view of Islam being held supreme over other views), and her history well-researched. In person, I asked her why she thought fundamentalism had become more popular throughout the world, not just in troubled countries. Her response was a very straightforward, "Globalism. When the world becomes smaller, you lose what you think you used to have, and you try very hard to cling to traditions which you think you might be losing." I would have appreciated further development of that theme, but did not find that in this book.
All in all, I'm convinced that a Reformation of some kind is necessary before the middle east can make progress. I am not sure what form it will take, however, and perhaps a little disappointed that Manji ultimately veers away what I consider would be the ultimate destination of her religious exploration, which is secular humanism, a philosophy that is more fruitful and less condemning of human reason than even a reformed Islam would be. But ultimately, that is a religious choice, and as it is, I would not want to condemn her for standing out there in the face of death-threats --- in her position I would probably not be as brave!
Saturday, November 24, 2007
Review: Schulz and Peanuts
I will confess to being a far bigger fan of Bill Waterson than I am of Charles Schulz, but any understanding of comic strip history will have most understand that without Peanuts, there would have been no Calvin and Hobbes.
With as beloved a subject as the creator of Snoopy, I expected the book to be a love-fest, about the genius of Charles Schulz, at it were. Nothing could have been further than the truth. If indeed David Michaelis the author were a big fan of Peanuts, he understood that the hero, the creator of Peanuts himself had "feet of clay." Schulz grew up the only child of an under-educated couple: neither parents graduated High School, and his mother did not finish fourth grade. His father, a fastidious barber who always put his customers first, was interested in neither the news nor philosophy, admonished that a barber should never descend into heavy talk with his customer. Schulz's childhood, where both parents did not appear to believe that he would succeed in making a career out of his drawing appear to have left an indelible impression of the young Schulz.
His mother died just as he was drafted into World War II, saying with her last words to him as he were to leave, "Good-bye, Sparky. We'll probably never see each other again." As if to make up for this lack of confidence from his parents, the world turned in his favor --- he did well in the military, and he was by chance was held back enough to arrive in Germany only after the worst of the war was over, fired on only a few times by the enemy.
After the war, Schulz went right back to art, and by the end of 1950 had sold what was to become Peanuts to United Features Syndicate. The book, however, glosses over his success there, and focuses on what Schulz considers his failures --- chiefest of which seems to be his inability to attract women. He pursues one after the other, but gets repeatedly spurned over what he believed to be his mediocre looks (which apparently wasn't true) or his lack of prospects (which made him vow that he'd show them what he was made of). He thus approached the rest of his life with a big chip on his shoulder.
He did eventually get married, of course, to a beautiful divorcee who gave him 4 more children. But the marriage was by many accounts an unhappy one --- Joyce Schulz with her sharp wit would take down Charles Schulz as often as she could, despite his being the material provider of exceptional capability. Michaelis would illustrate this with strip after strip from Peanuts, with Joyce obviously being the Lucy who would continually taunt and hurt Charlie Brown. In his own response, Schulz would retreat back into his world of drawing comics (which Joyce never bothered reading), much as Schroeder ignored Lucy to play with his child's piano.
Another interesting topic for me was how autobiographical Peanuts was. Schulz's thoughts, relationships, history with his family, and philosophy would all show up on it. Michaelis cleverly even shows how his love affairs made their way to the strips.
As Schulz got more and more successful, one would think that he would find his way to happiness. Well, let this be a warning to those who seek happiness through wealth: Schulz never did find it through wealth. Not even when he finally tried to leave Joyce to woo a much younger lady friend did it help him:
Just then, a towering sailboat drew up alongside, and her heart froze, because she could see in his eyes that the yacht embodied a new way to break open their stalemate. "If you married me," he said, "you could have anything you want. I make four thousand dollars a day."
The lady, of course, refused, despite Schulz's desperation.
What about religion? Schulz was an extremely religious man, having converted in his early 20s and tithing 10% of his income well into his adulthood. It was clear on reading the book that while he held on to his Christianity, the religion never did bring that much meaning to his life either. Perhaps if your entire tenet in life is that nobody could love you because you're a nobody, it's hard for you to believe that even God could do so.
But his work saved him right? Yet it appalled me to see him use his status as a mentor to attempt to influence Lynn Johnson when she needed a way to kill the aging family dog, Farley, in her strip (unlike Schulz's strip, Johnson's strip actually moved forward and aged her characters):
...when she was finished explaining how Farley was going to die trying to save the Pattersons' youngest daughter, April, from drowning in a spring-freshened river, there was silence on the phone, and then Schulz said: "If you do this story, I am going to have Snoopy get hit by a truck and go to the hospital, and everybody will worry about Snoopy, and nobody's going to read your stupid story." As if to prove that Snoopy was still the biggest newsmaker, he added, "And I'll get more publicity than you will! So there!"
Ultimately, Schulz life becomes very much like that of his favorite movie, Citizen Kane: he did not have to be alone, but he made himself alone anyway, and all because he refused to acknowledge that others might love him, so despite all the profession of love from others (his wife and his children) he never needed to reciprocate and make himself vulnerable.
This book is clearly a masterpiece. The strips chosen to illustrate Michaelis' points were well-selected (there are a couple of repeats, but those were infrequent), the notes and bibliography excellent, and points come across clearly but are not hammered home as if the reader had no mind. All in all, this book is a great lesson on the limits of wealth, talent, hard work, and religion. More people should read this book. Highly recommended.
With as beloved a subject as the creator of Snoopy, I expected the book to be a love-fest, about the genius of Charles Schulz, at it were. Nothing could have been further than the truth. If indeed David Michaelis the author were a big fan of Peanuts, he understood that the hero, the creator of Peanuts himself had "feet of clay." Schulz grew up the only child of an under-educated couple: neither parents graduated High School, and his mother did not finish fourth grade. His father, a fastidious barber who always put his customers first, was interested in neither the news nor philosophy, admonished that a barber should never descend into heavy talk with his customer. Schulz's childhood, where both parents did not appear to believe that he would succeed in making a career out of his drawing appear to have left an indelible impression of the young Schulz.
His mother died just as he was drafted into World War II, saying with her last words to him as he were to leave, "Good-bye, Sparky. We'll probably never see each other again." As if to make up for this lack of confidence from his parents, the world turned in his favor --- he did well in the military, and he was by chance was held back enough to arrive in Germany only after the worst of the war was over, fired on only a few times by the enemy.
After the war, Schulz went right back to art, and by the end of 1950 had sold what was to become Peanuts to United Features Syndicate. The book, however, glosses over his success there, and focuses on what Schulz considers his failures --- chiefest of which seems to be his inability to attract women. He pursues one after the other, but gets repeatedly spurned over what he believed to be his mediocre looks (which apparently wasn't true) or his lack of prospects (which made him vow that he'd show them what he was made of). He thus approached the rest of his life with a big chip on his shoulder.
He did eventually get married, of course, to a beautiful divorcee who gave him 4 more children. But the marriage was by many accounts an unhappy one --- Joyce Schulz with her sharp wit would take down Charles Schulz as often as she could, despite his being the material provider of exceptional capability. Michaelis would illustrate this with strip after strip from Peanuts, with Joyce obviously being the Lucy who would continually taunt and hurt Charlie Brown. In his own response, Schulz would retreat back into his world of drawing comics (which Joyce never bothered reading), much as Schroeder ignored Lucy to play with his child's piano.
Another interesting topic for me was how autobiographical Peanuts was. Schulz's thoughts, relationships, history with his family, and philosophy would all show up on it. Michaelis cleverly even shows how his love affairs made their way to the strips.
As Schulz got more and more successful, one would think that he would find his way to happiness. Well, let this be a warning to those who seek happiness through wealth: Schulz never did find it through wealth. Not even when he finally tried to leave Joyce to woo a much younger lady friend did it help him:
Just then, a towering sailboat drew up alongside, and her heart froze, because she could see in his eyes that the yacht embodied a new way to break open their stalemate. "If you married me," he said, "you could have anything you want. I make four thousand dollars a day."
The lady, of course, refused, despite Schulz's desperation.
What about religion? Schulz was an extremely religious man, having converted in his early 20s and tithing 10% of his income well into his adulthood. It was clear on reading the book that while he held on to his Christianity, the religion never did bring that much meaning to his life either. Perhaps if your entire tenet in life is that nobody could love you because you're a nobody, it's hard for you to believe that even God could do so.
But his work saved him right? Yet it appalled me to see him use his status as a mentor to attempt to influence Lynn Johnson when she needed a way to kill the aging family dog, Farley, in her strip (unlike Schulz's strip, Johnson's strip actually moved forward and aged her characters):
...when she was finished explaining how Farley was going to die trying to save the Pattersons' youngest daughter, April, from drowning in a spring-freshened river, there was silence on the phone, and then Schulz said: "If you do this story, I am going to have Snoopy get hit by a truck and go to the hospital, and everybody will worry about Snoopy, and nobody's going to read your stupid story." As if to prove that Snoopy was still the biggest newsmaker, he added, "And I'll get more publicity than you will! So there!"
Ultimately, Schulz life becomes very much like that of his favorite movie, Citizen Kane: he did not have to be alone, but he made himself alone anyway, and all because he refused to acknowledge that others might love him, so despite all the profession of love from others (his wife and his children) he never needed to reciprocate and make himself vulnerable.
This book is clearly a masterpiece. The strips chosen to illustrate Michaelis' points were well-selected (there are a couple of repeats, but those were infrequent), the notes and bibliography excellent, and points come across clearly but are not hammered home as if the reader had no mind. All in all, this book is a great lesson on the limits of wealth, talent, hard work, and religion. More people should read this book. Highly recommended.
Wednesday, November 21, 2007
My thanksgiving present
I felt a little funny on Sunday morning right after posting my last entry. I went for a hike anyway, but found my energy low. That afternoon, I took a nap, but started feeling really cold. Come Monday morning I woke up drenched in sweat. A temperature check found my temperature near 100, not yet a fever, but my throat felt a little itchy.
I went to see my doctor, and he thought it was viral. So he gave me some TamiFlu in the hopes that it would nix it in the bud. That night, I went in and out of shiver mode all night. I went back to see my doctor again, and he found what seemed to be an infection in my ear and throat, so now he added antibiotics to the mix. Lisa added a bunch of Chinese herbs and some acupuncture to this medical cocktail, just to make sure I got due representation from all sides of the East/West debate.
Last night was the worst. I had periods of 103 temperature, but I got myself fully hydrated and woke up only a few times. Still, I was so light headed I would just topple back to bed after using the bathroom.
This morning though, my fever appeared to break and I felt better, though I still can't seem to eat much and my throat now hurts more (or maybe it's that I now notice it more!). So hopefully all this medical stuff I'm on kicks in soon.
You might think that 'flu is not a serious illness, but I've been sick with 'flu a few times in my life, and it always felt really really bad. It's not hard to believe that it causes 1.2% of total deaths in my age group. And yes, we did get 'flu shots this year. All I can say is, medical science just can't progress fast enough. I'd take immunity to all diseases over a faster car (ok, maybe for me that'll be a lighter bike), movie star good looks, or a trip to outer space any day!
Ok, I will now return you to the regularly scheduled book reviews and commentary.
I went to see my doctor, and he thought it was viral. So he gave me some TamiFlu in the hopes that it would nix it in the bud. That night, I went in and out of shiver mode all night. I went back to see my doctor again, and he found what seemed to be an infection in my ear and throat, so now he added antibiotics to the mix. Lisa added a bunch of Chinese herbs and some acupuncture to this medical cocktail, just to make sure I got due representation from all sides of the East/West debate.
Last night was the worst. I had periods of 103 temperature, but I got myself fully hydrated and woke up only a few times. Still, I was so light headed I would just topple back to bed after using the bathroom.
This morning though, my fever appeared to break and I felt better, though I still can't seem to eat much and my throat now hurts more (or maybe it's that I now notice it more!). So hopefully all this medical stuff I'm on kicks in soon.
You might think that 'flu is not a serious illness, but I've been sick with 'flu a few times in my life, and it always felt really really bad. It's not hard to believe that it causes 1.2% of total deaths in my age group. And yes, we did get 'flu shots this year. All I can say is, medical science just can't progress fast enough. I'd take immunity to all diseases over a faster car (ok, maybe for me that'll be a lighter bike), movie star good looks, or a trip to outer space any day!
Ok, I will now return you to the regularly scheduled book reviews and commentary.
Sunday, November 18, 2007
Review: Bicycling and The Law
Bob Mionske is a cycling lawyer, and writes the Legally Speaking column for VeloNews.
In addition to being a collection of all the columns in the magazine, this book collects many additional tit-bits about cycling that you might not have known before.
For instance:
Following those last two chapters, Mionske covers insurance and how much you need (most people are under insured, which means that your insurance might be forced to pick up the slack, so you should at least be adequately insured). He rails (rightly so) against the insurance industry for only offering automobile-oriented insurance, and not insurance that covers cyclists specifically. He then goes on to discuss forms of harassment to cyclists (a surprising amount of it done by law enforcement officers, in his experience), what cyclists can do about it (it turns out that lobbying and publicly embarrassing those involved is surprisingly effective). The last three chapters cover bicycle theft, defective products, and liability waivers.
All through the book, Mionske does not hide his biases --- he believes cyclists are blatantly discriminated against (something that most cyclists will agree with), and that the legal system can be an effective recourse, though getting law enforcement officers, courts, and juries to work effectively for a discriminated-against minority would seem to be a big challenge. He writes very effectively in his advocacy of these positions, and to my mind, I think he has succeeded. He's even convinced me that tort-reform is something extremely anti-consumer, which given the prevailing opinion of lawyers that most people have, is no mean feat.
The entire book is written in a clear, precise, and easy to comprehend fashion. At no point does Mionske descend into legalese without providing you with the context and an explanation of what is going on. The case studies in particular are fantastic. Some of them are funny, some of them are sad, but all of them are instructive. Where the law has been undefined, Mionske doesn't hesitate to say so, and one gets the impression that he would relish an opportunity to test those areas, if an appropriate case ever turned up.
I paid Amazon.com prices for this book, but now that I've read it, I would have willingly paid full price. This is a book that should be on every cyclist's bookshelf. Read it once to get an idea of what is covered, and keep it easily accessible as a reference. Highly recommended!
In addition to being a collection of all the columns in the magazine, this book collects many additional tit-bits about cycling that you might not have known before.
For instance:
- If I were to put together a bike ride to the coast with a bunch of friends, am I liable if anyone was injured?
- Supposed my bike was stolen and then found in a pawn shop. Am I legally obligated to pay the pawn shop for my bike?
- If I get pulled over by a cop for riding on the road too slowly, can I fight the ticket?
- Am I obligated to wear brightly colored clothing on my bike? If I'm not and am involved in a crash, what happens to me legally?
Following those last two chapters, Mionske covers insurance and how much you need (most people are under insured, which means that your insurance might be forced to pick up the slack, so you should at least be adequately insured). He rails (rightly so) against the insurance industry for only offering automobile-oriented insurance, and not insurance that covers cyclists specifically. He then goes on to discuss forms of harassment to cyclists (a surprising amount of it done by law enforcement officers, in his experience), what cyclists can do about it (it turns out that lobbying and publicly embarrassing those involved is surprisingly effective). The last three chapters cover bicycle theft, defective products, and liability waivers.
All through the book, Mionske does not hide his biases --- he believes cyclists are blatantly discriminated against (something that most cyclists will agree with), and that the legal system can be an effective recourse, though getting law enforcement officers, courts, and juries to work effectively for a discriminated-against minority would seem to be a big challenge. He writes very effectively in his advocacy of these positions, and to my mind, I think he has succeeded. He's even convinced me that tort-reform is something extremely anti-consumer, which given the prevailing opinion of lawyers that most people have, is no mean feat.
The entire book is written in a clear, precise, and easy to comprehend fashion. At no point does Mionske descend into legalese without providing you with the context and an explanation of what is going on. The case studies in particular are fantastic. Some of them are funny, some of them are sad, but all of them are instructive. Where the law has been undefined, Mionske doesn't hesitate to say so, and one gets the impression that he would relish an opportunity to test those areas, if an appropriate case ever turned up.
I paid Amazon.com prices for this book, but now that I've read it, I would have willingly paid full price. This is a book that should be on every cyclist's bookshelf. Read it once to get an idea of what is covered, and keep it easily accessible as a reference. Highly recommended!
Wednesday, November 14, 2007
Obama Visits Google
I got a chance to see senator Obama first hand today when he visited Google to give a speech and take questions from Eric Schmidt and other Googlers. My current approach to politics is anybody but a Republican. Both the Republican front-runners are extremely distasteful to me --- both seem to promise more tax cuts for the already wealthy, are in denial about global warming, and have no concern for budget deficits or getting out of the morass that is Iraq.
My concern with Obama was borne from reading Paul Krugman's blog entry. The concern there was that Obama had bought into the right-wing attacks on social security as the biggest fiscal problem facing the country. The truth is that it is not. Medicare/Medicaid is. My concern was alleviated slightly today, when asked about the deficit, Obama said that he would first get out of Iraq (saving $192 billion), and then try to attack the next biggest deficit problem, which was Medicare/Medicaid. Social Security was not mentioned.
Compared with the other big candidate I saw in person, Hilary Clinton, Obama seemed a lot less like a politician, lot more earnest. I liked it that he said that what he learned from watching prior Democratic candidates lose was that if you don't stand for something people won't vote for you. Listening to Clinton talk, one just got the impression that she had spent too much time as a politician --- she refused to promise anything, and refused to make a stand on policies.
All in all, I could definitely see this man as the next President.
My concern with Obama was borne from reading Paul Krugman's blog entry. The concern there was that Obama had bought into the right-wing attacks on social security as the biggest fiscal problem facing the country. The truth is that it is not. Medicare/Medicaid is. My concern was alleviated slightly today, when asked about the deficit, Obama said that he would first get out of Iraq (saving $192 billion), and then try to attack the next biggest deficit problem, which was Medicare/Medicaid. Social Security was not mentioned.
Compared with the other big candidate I saw in person, Hilary Clinton, Obama seemed a lot less like a politician, lot more earnest. I liked it that he said that what he learned from watching prior Democratic candidates lose was that if you don't stand for something people won't vote for you. Listening to Clinton talk, one just got the impression that she had spent too much time as a politician --- she refused to promise anything, and refused to make a stand on policies.
All in all, I could definitely see this man as the next President.
Tuesday, November 13, 2007
Review: Argonautika
Lisa and I visited the Berkeley Rep on Saturday to see Mary Zimmerman's Argonautika. The story is the well-trod story of Jason and the Argonauts.
Since the play was only two and a half hour long (with a fifteen minute intermission), the story had to move fast. Narration is performed by the two goddesses involved in the story: Hera and Athena. Special effects abound. Actors descend from the ceiling suspended by wires, the trapdoor under the stage is used to good effect, and the stage itself was extremely well constructed.
I love how miniatures are used on stage to depict the larger picture, while the action on the stage shows a close up of what's going on. The cast seemed well rehearsed, though one still catches a flub or two here and there. A lot of the motion on stage seemed particularly strenuous, with rope climbing and flipping off the raised platform being quite common.
What amazed me was how well the action scenes were handled. In particular, when King Amycus challenges the heroes to a boxing match and Pollux accepts, the actors move in a simulated slow motion fashion which was just absolutely hilarious. Clearly, this is not a play an audience would be able to watch without the context and prevalence of modern action films.
The scenes that were made a big deal out of in the liner notes, the ones where Medea betrays her family for Jason because the gods made her fall in love, however, seem just a bit contrived. However, that does not detract from the overall quality of the play.
All in all, we definitely got our money's worth, and it was great fun for two hours. Recommended.
Since the play was only two and a half hour long (with a fifteen minute intermission), the story had to move fast. Narration is performed by the two goddesses involved in the story: Hera and Athena. Special effects abound. Actors descend from the ceiling suspended by wires, the trapdoor under the stage is used to good effect, and the stage itself was extremely well constructed.
I love how miniatures are used on stage to depict the larger picture, while the action on the stage shows a close up of what's going on. The cast seemed well rehearsed, though one still catches a flub or two here and there. A lot of the motion on stage seemed particularly strenuous, with rope climbing and flipping off the raised platform being quite common.
What amazed me was how well the action scenes were handled. In particular, when King Amycus challenges the heroes to a boxing match and Pollux accepts, the actors move in a simulated slow motion fashion which was just absolutely hilarious. Clearly, this is not a play an audience would be able to watch without the context and prevalence of modern action films.
The scenes that were made a big deal out of in the liner notes, the ones where Medea betrays her family for Jason because the gods made her fall in love, however, seem just a bit contrived. However, that does not detract from the overall quality of the play.
All in all, we definitely got our money's worth, and it was great fun for two hours. Recommended.
Review: The Age of Turbulence
Alan Greenspan is perhaps the last of a dying breed, the reality-based Republican. As chairman of the Federal Reserve, he presided over the Clinton boom. As part of the Reagan administration, he was responsible for raising payroll taxes (yes, an extremely regressive tax) to "save social security".
The first part of this book is largely autobiographical, describing his childhood, his interest in economics, and eventually his appointment as a technical economist in the Ford, Reagan, and Bush administrations. The most entrancing portions of this books are the descriptions of his time as chairman of the Federal Reserve. Obviously, he had access to data and analysis that nobody else had, but nevertheless, had to rely very much on his instinct in guiding the world's largest economy. It was amazing how often he got it right.
Of course, he gets it wrong as well, mostly on the political side. His excuse for giving Congress and the Bush administration permission to grant giant tax cuts and destroy the hard fought surplus built up over the 1990s was that he gave a nuanced policy recommendation to an extremely partisan congress that was determined to misread him. While Brad DeLong might be willing to forgive him that, I doubt that future historians will be so kind.
The second half of the book focuses on topics near and dear to Greenspan: what the causes of economic growth are (where he is surprisingly close to Bernstein's The Birth of Plenty at least, with respect to the rule of law and property protection), a tour of the world's economic geography and what the problems each area has, globalization, retirement, corporate governance, and the shortage of oil.
As a reality-based person, I think he is very good and correct in his analysis. He is definitely gloomy about the prospect of the human race being able to contain global warming, and seems to have resigned himself to mitigation based solutions rather than prevention --- given that he is already in his 70s, that is perhaps a suitable view to take. Those of us who are younger might not wish to be so sanguine.
All in all, I learnt quite a bit from this book --- from how the federal reserve works to what the explanation is behind the current high oil prices. I disagree with many of his views (e.g., his solution for "saving social security" involves increasing an already highly regressive tax, rather than expanding the tax to all incomes; his observations of the medicare problem conveniently leaves out how inefficient our medical system is, because it is one of the few failures of capitalism that have been analyzed to death)
A challenging book, but worth the time.
The first part of this book is largely autobiographical, describing his childhood, his interest in economics, and eventually his appointment as a technical economist in the Ford, Reagan, and Bush administrations. The most entrancing portions of this books are the descriptions of his time as chairman of the Federal Reserve. Obviously, he had access to data and analysis that nobody else had, but nevertheless, had to rely very much on his instinct in guiding the world's largest economy. It was amazing how often he got it right.
Of course, he gets it wrong as well, mostly on the political side. His excuse for giving Congress and the Bush administration permission to grant giant tax cuts and destroy the hard fought surplus built up over the 1990s was that he gave a nuanced policy recommendation to an extremely partisan congress that was determined to misread him. While Brad DeLong might be willing to forgive him that, I doubt that future historians will be so kind.
The second half of the book focuses on topics near and dear to Greenspan: what the causes of economic growth are (where he is surprisingly close to Bernstein's The Birth of Plenty at least, with respect to the rule of law and property protection), a tour of the world's economic geography and what the problems each area has, globalization, retirement, corporate governance, and the shortage of oil.
As a reality-based person, I think he is very good and correct in his analysis. He is definitely gloomy about the prospect of the human race being able to contain global warming, and seems to have resigned himself to mitigation based solutions rather than prevention --- given that he is already in his 70s, that is perhaps a suitable view to take. Those of us who are younger might not wish to be so sanguine.
All in all, I learnt quite a bit from this book --- from how the federal reserve works to what the explanation is behind the current high oil prices. I disagree with many of his views (e.g., his solution for "saving social security" involves increasing an already highly regressive tax, rather than expanding the tax to all incomes; his observations of the medicare problem conveniently leaves out how inefficient our medical system is, because it is one of the few failures of capitalism that have been analyzed to death)
A challenging book, but worth the time.
Sunday, November 11, 2007
You cannot outsource financial work part II
A few days ago, I was talking to someone at work, and he said, "I'm going to have to fire my financial adviser. I started working with them 3 months ago, and they're providing negative returns."
There are a few issues with this statement. First of all, financial planning is a multi-decade process. Judging the results of an adviser after 3 months is a lot like judging the results of a marathon after the first 300 meters. Secondly, it is very important not to confuse process with outcome. The decisions and the reasons behind the decisions are more important than the immediate outcome. Let's say you decided, based on your analysis of certain macro-economic factors, that an unusually large bet on say, Vanguard Energy Fund was desirable. If someone suddenly invented a cold fusion reactor the size of a car's engine thereby eliminating the need for gasoline, the result would be bad for your portfolio, but there was no way to have anticipated that outcome without knowing the future.
Finally, it is very easy to get carried away with making short term decisions. For instance, in one of his rare errors, the man behind pfblog writes about switching away from Vanguard's Value Fund to the Fidelity Contra Fund because of the poor recent performance of the former. The two funds are so different that he was comparing apples with oranges! The ContraFund is at its heart a Growth fund, and this has been a great year for Growth. Value funds have recently taken a hit over the last few months. When Bill Bernstein made that observation, he followed up with a comment: "this reflects the additional risk of the value strategy. And that's a good thing, because if there was no risk, there would be no reward."
That is why you won't get me posting my portfolio performance numbers here on this blog (and wouldn't you like to know!). Even a five year performance number wouldn't be really representative, since we've been fortunate this last five years to have a great bull market. As the old saying goes, "When the tide goes out, that's when you find out who's been swimming without shorts."
Despite my statements about how you cannot outsource financial work, some people keep insisting on asking me for recommendations on financial advisers. When they do that, I point them at the Vanguard Financial Advisers page. These are the only guys I've talked to who don't come across as sleaze balls. They're conservative (which is a good thing --- you want your financial adviser to be more conservative than you are), and they know what they are doing. That said, in the middle of my interview with one of them about 3 years ago I realized that I knew more than the guy who was talking to, and that was that.
There is one guy I am using to get access to DFA funds. But we don't have an advisory relationship. He does seem like quite a reasonable fellow, but you won't get me recommending people unless I've interviewed them extensively, and so far, no one who's asked me for a recommendation for a financial adviser has been willing to pay my hourly rate to interview someone extensively enough for me to provide an evaluation.
There are a few issues with this statement. First of all, financial planning is a multi-decade process. Judging the results of an adviser after 3 months is a lot like judging the results of a marathon after the first 300 meters. Secondly, it is very important not to confuse process with outcome. The decisions and the reasons behind the decisions are more important than the immediate outcome. Let's say you decided, based on your analysis of certain macro-economic factors, that an unusually large bet on say, Vanguard Energy Fund was desirable. If someone suddenly invented a cold fusion reactor the size of a car's engine thereby eliminating the need for gasoline, the result would be bad for your portfolio, but there was no way to have anticipated that outcome without knowing the future.
Finally, it is very easy to get carried away with making short term decisions. For instance, in one of his rare errors, the man behind pfblog writes about switching away from Vanguard's Value Fund to the Fidelity Contra Fund because of the poor recent performance of the former. The two funds are so different that he was comparing apples with oranges! The ContraFund is at its heart a Growth fund, and this has been a great year for Growth. Value funds have recently taken a hit over the last few months. When Bill Bernstein made that observation, he followed up with a comment: "this reflects the additional risk of the value strategy. And that's a good thing, because if there was no risk, there would be no reward."
That is why you won't get me posting my portfolio performance numbers here on this blog (and wouldn't you like to know!). Even a five year performance number wouldn't be really representative, since we've been fortunate this last five years to have a great bull market. As the old saying goes, "When the tide goes out, that's when you find out who's been swimming without shorts."
Despite my statements about how you cannot outsource financial work, some people keep insisting on asking me for recommendations on financial advisers. When they do that, I point them at the Vanguard Financial Advisers page. These are the only guys I've talked to who don't come across as sleaze balls. They're conservative (which is a good thing --- you want your financial adviser to be more conservative than you are), and they know what they are doing. That said, in the middle of my interview with one of them about 3 years ago I realized that I knew more than the guy who was talking to, and that was that.
There is one guy I am using to get access to DFA funds. But we don't have an advisory relationship. He does seem like quite a reasonable fellow, but you won't get me recommending people unless I've interviewed them extensively, and so far, no one who's asked me for a recommendation for a financial adviser has been willing to pay my hourly rate to interview someone extensively enough for me to provide an evaluation.
Thursday, November 08, 2007
Warren Buffett Interview
I love it. He challenges anyone in the Forbes 400 to see if they pay higher taxes than their receptionist (I bet there'll be an exception, but that's because maybe one of them married their receptionist, *smirk*)
I will admit that I pay federal taxes at a very similar rate to Warren Buffet. (See my prior posts on Tax Planning) And yes, I actively vote Democratic, against my own economic self-interest. Why? Because in the long run, a society where people can get ahead by working hard will generate more prosperity than a society where the rich get richer and everyone else gets screwed. And we are unfortunately headed in the direction of the latter.
There are plenty of countries with such severe inequalities that kidnappings of the wealthy (or murder, etc) are common in the news. I would not wish the US to become one of them.
I will admit that I pay federal taxes at a very similar rate to Warren Buffet. (See my prior posts on Tax Planning) And yes, I actively vote Democratic, against my own economic self-interest. Why? Because in the long run, a society where people can get ahead by working hard will generate more prosperity than a society where the rich get richer and everyone else gets screwed. And we are unfortunately headed in the direction of the latter.
There are plenty of countries with such severe inequalities that kidnappings of the wealthy (or murder, etc) are common in the news. I would not wish the US to become one of them.
Wednesday, November 07, 2007
Outsourced: The Movie
This is the third movie I've seen at Google as part of a special engagement...The previous two being King of Kong, and the other A Moment with You.
This movie deals with outsourcing as its main topics and the very first few minutes of the film sets it up. A manager of a call center finds out that his group is to be laid off and he is to go to India to train his replacement. He goes reluctantly, and eventually integrates into the society that he's supposed to train to at least sound more American.
Its a romantic comedy, and it doesn't fail on either the romance or the comedy. The movie works quite well on both levels and the pacing was just right. At about 2 hours, the story, though simplistic has enough meat to make you feel satisfied without boring you at any point.
The producer stayed at the end of the movie for questions and to relay several cute statistics:
As a freshman effort, I must say I'm very impressed at this film and certainly recommend people either catch it in theatres if they can, or buy the DVD. Its certainly worth the time!
This movie deals with outsourcing as its main topics and the very first few minutes of the film sets it up. A manager of a call center finds out that his group is to be laid off and he is to go to India to train his replacement. He goes reluctantly, and eventually integrates into the society that he's supposed to train to at least sound more American.
Its a romantic comedy, and it doesn't fail on either the romance or the comedy. The movie works quite well on both levels and the pacing was just right. At about 2 hours, the story, though simplistic has enough meat to make you feel satisfied without boring you at any point.
The producer stayed at the end of the movie for questions and to relay several cute statistics:
- They spent 30 days in India, and 2 days in Seattle. They also apparently didn't run into many production problems other than a few times when the cops said they couldn't film for a particular day.
- They invented a name for the city the outsourced call center is based in because Indians are very particular about the correctness or incorrectness of an accent. So if they had said the call center was based in Mumbai, folks in Mumbai would watch the movie and deride the inaccuracy of the accents. So they invented the name of the city, thus disallowing this criticism. =)
- The producer did this film because of his time spent as a student in India. His wasn't a story of a job outsourced, or a romance struck up while in India. He was just a foreigner who was fascinated while he was in India and decided to make a movie out of it to explain to people asking "just what is India like?" and this was the result.
As a freshman effort, I must say I'm very impressed at this film and certainly recommend people either catch it in theatres if they can, or buy the DVD. Its certainly worth the time!
Tuesday, November 06, 2007
Greg Mankiw keeps digging his hole
As Krugman pointed out yesterday, I hope Republican candidates parrot Mankiw. When someone like me (always had health insurance, in good general health) gets denied health coverage due to "pre-existing conditions", you know the system is screwed up beyond help and radical reform is needed. Note that I can afford health insurance (and I'm covered currently through my employer's group health care). It's the individual health insurance market that's all messed up.
Maybe the radical reform can be as simple as: "You must provide a single quote to all your customers, young or old, rich or poor, healthy or not. You are not allowed to deny anyone coverage if they ask and are willing to pay that single quote." But something has to be done, and the candidate that has a concrete plan to do it will get my vote.
Seriously, even if you're care only for economic development, portable universal healthcare makes sense. By guaranteeing healthcare even if you run off to join a startup, you've reduced the risk of joining startups or starting your own businesses, and those are the engines of economic growth.
Maybe the radical reform can be as simple as: "You must provide a single quote to all your customers, young or old, rich or poor, healthy or not. You are not allowed to deny anyone coverage if they ask and are willing to pay that single quote." But something has to be done, and the candidate that has a concrete plan to do it will get my vote.
Seriously, even if you're care only for economic development, portable universal healthcare makes sense. By guaranteeing healthcare even if you run off to join a startup, you've reduced the risk of joining startups or starting your own businesses, and those are the engines of economic growth.
Monday, November 05, 2007
A must read for would-be investors
The way I see it, there are at least seven traits great investors share that are true sources of advantage because they can't be learned once a person reaches adulthood. In fact, some of them can't be learned at all; you're either born with them or you aren't.
Trait #1 is the ability to buy stocks while others are panicking and sell stocks while others are euphoric. Everyone thinks they can do this, but then when October 19, 1987 comes around and the market is crashing all around you, almost no one has the stomach to buy. When the year 1999 comes around and the market is going up almost every day, you can't bring yourself to sell because if you do, you may fall behind your peers. The vast majority of the people who manage money have MBAs and high IQs and have read a lot of books. By late 1999, all these people knew with great certainty that stocks were overvalued, and yet they couldn't bring themselves to take money off the table because of the "institutional imperative," as Buffett calls it.
Trait #1 is the ability to buy stocks while others are panicking and sell stocks while others are euphoric. Everyone thinks they can do this, but then when October 19, 1987 comes around and the market is crashing all around you, almost no one has the stomach to buy. When the year 1999 comes around and the market is going up almost every day, you can't bring yourself to sell because if you do, you may fall behind your peers. The vast majority of the people who manage money have MBAs and high IQs and have read a lot of books. By late 1999, all these people knew with great certainty that stocks were overvalued, and yet they couldn't bring themselves to take money off the table because of the "institutional imperative," as Buffett calls it.
Sunday, November 04, 2007
Steve Levy Reports on the APM World Tour
This sort of enterprise was exactly what Google was hoping for when it began the APM program five years ago. Earlier attempts to hire veterans from firms like Microsoft had awful results. "Google is so different that it was almost impossible to reprogram them into this culture," says CEO Eric Schmidt. The difficulties led Google VP Mayer (employee No. 20) to wonder whether experience was way overrated. The earliest Google employees were distinguished by an abundance of brain cells as opposed to a fat r?sum? or a stint at McKinsey. Why not replicate the phenomenon?
Compare and contrast with the CEO of Pure Software (and later, Netflix):
Startups are a great place to do, not to learn.
Compare and contrast with the CEO of Pure Software (and later, Netflix):
Startups are a great place to do, not to learn.
Dead iPod
My ipod, after about 3 years, has died with a clicking noise. MTBF for a hard drive is about 5 years, but my guess is that portable applications see a lot of abuse (and I will admit to not treating my ipod too kindly), so I'm guessing that I'm smack in the middle for iPod life. At the time, ipods cost $400, so it'll be more than $100 a year for the privilege of listening to my music on the go.
I doubt if I'll replace it with another ipod, when an 8GB Sansa can be had for $115. It's probably not worth repairing, either, since a replacement disk would cost around $130.
Here are my requirements:
I doubt if I'll replace it with another ipod, when an 8GB Sansa can be had for $115. It's probably not worth repairing, either, since a replacement disk would cost around $130.
Here are my requirements:
- Long enough battery life for a flight to Zurich (about 10 hours or so, call it 15 hours to be safe)
- Must play MP3s (I don't have music in any other format, so I'm not locked into the iPod economy)
- Light enough to carry on bike trips.
- Good sound quality.
- Enough music for a 3 week bike trip.
- Tough. I will use this on hikes, and being carried in saddlebags is not good for most electronics.
- Games. If I want games, I'll get a dedicated game machine.
- Video. Most players don't have enough storage for a decent amount of video. Those that do, don't have screens that I consider satisfactory.
- Solo hikes, about once a week or so.
- Feeding the home stereo, 3 days a week.
- Planes: Twice a year
- Long trips (about 3 weeks each), possibly disconnected from civilization, about twice a year, but with increasing frequency.
Why Financial Planning is Important
In 1995, I was working at Pure Software when the company went public. One of the very early engineers said to me that day, "I've achieved the American Dream. Millionaire before 30." At that time, his net worth was easily into the mid single digit millions.
Fast forward a little more than a decade later, and I'm trying to recruit the same person to my company. We eat lunch, and we chat. I ask if he even needs to work anymore, given what I knew of his finances, and he said, "Actually, no, I do need to work." The house he lived in was paid off, but his finances weren't in as good condition as I had assumed.
Before you think, "What an idiot. This can't happen to me." Consider this:
I'll close with a reflection on John Greaney's page on retirement planing:
The time I spent ... learning about financial markets were undoubtably the most highly compensated hours of my career.
Not only does the learning help you avoid pitfalls that others fall into, the learning leverages all the money you'll make in your career, giving you a double whammy as your career grows. If you're Jack Welch, John Chambers, or similar CEO/entrepreneur material, you might not need such an education, but for the rest of us, learning this stuff isn't nearly as hard as programming in C++, and is easily as lucrative.
Fast forward a little more than a decade later, and I'm trying to recruit the same person to my company. We eat lunch, and we chat. I ask if he even needs to work anymore, given what I knew of his finances, and he said, "Actually, no, I do need to work." The house he lived in was paid off, but his finances weren't in as good condition as I had assumed.
Before you think, "What an idiot. This can't happen to me." Consider this:
- In 1995, financial information was hard to find. The list of good financial books worth reading for non-experts was down to Burton Malkiel's A Random Walk Down Wall Street, which while it is as good then as it is today, was a bit of a read. (My mom still doesn't understand the book)
- Vanguard did not have a web presence then. The web brokerages were dominated by folks like eTrade, which did terrible things in executing your trades that you wouldn't want.
- Financial advise on the web was limited to The Motley Fool, which back then touted Rule Breakers, Rule Makers, and a bunch of high risk strategies.
- John P. Greaney's fabulous Retire Early Home Page, which I recommend to anyone, did not exist until 1999.
- In person financial advisers were just as ignorant and sleazy as they are today. It is common, in my experience, for even sophisticated, intelligent people to fall prey to them.
I'll close with a reflection on John Greaney's page on retirement planing:
The time I spent ... learning about financial markets were undoubtably the most highly compensated hours of my career.
Not only does the learning help you avoid pitfalls that others fall into, the learning leverages all the money you'll make in your career, giving you a double whammy as your career grows. If you're Jack Welch, John Chambers, or similar CEO/entrepreneur material, you might not need such an education, but for the rest of us, learning this stuff isn't nearly as hard as programming in C++, and is easily as lucrative.
Saturday, November 03, 2007
Highly Concentrated Portfolios: A Case Study
I know a lot of people with concentrated portfolios. Most of these people don't need my advice. The reason, as laid out in this excellent article by John P. Greaney, is that if you can live on less than 1.5% of your portfolio, your need for diversification is lower. (Note that it's not riskless --- for instance, if you had a concentrated porfolio in Enron stock, you would not be happy come 2002 if you had not diversified! Diversification is still advisable!)
Here's a case study of a purely hypothetical person who took a drastic step outlined in a previous article and moved to a tax haven for retirement. One of the things they don't always tell you about these moves is that some tax havens may not have well developed financial services, so you may be stuck with the limited investment choices provided by Vanguard Global Services.
Let's say this person divested partially out of his concentrated position by selling about half his concentrated portfolio. What should he do with the money, given the limited investment choices? I'm a big fan of simplicity, so I can see a few good choices:
So what is our hypothetical friend supposed to do with the cash portion of his portfolio? My general thinking would be: 40% developed world markets, 10% emerging markets, 40% bond funds and 10% cash. The reason is that this gives him an overall 75% equity and 25% fixed income (remember, half his assets is still in that highly concentrated portfolio!). If you want to get more sophisticated you can slice and dice and eliminate the US components of the index, since that's already taken care of by the concentrated position (though I don't generally think that's a good idea, since if you have all your US holdings in one stock, it's quite possible for that one stock to do badly while the rest of the US goes on merrily on its way).
This should grant reasonable protection against a crash in equity markets or rampant inflation. Given that such a person is already able to live off of less than 1% of his assets, this makes his already relatively safe position even safer. Comments on this analysis is welcome.
Here's a case study of a purely hypothetical person who took a drastic step outlined in a previous article and moved to a tax haven for retirement. One of the things they don't always tell you about these moves is that some tax havens may not have well developed financial services, so you may be stuck with the limited investment choices provided by Vanguard Global Services.
Let's say this person divested partially out of his concentrated position by selling about half his concentrated portfolio. What should he do with the money, given the limited investment choices? I'm a big fan of simplicity, so I can see a few good choices:
- Global Stock Index Fund
- Emerging Market Fund
- Various bond funds
So what is our hypothetical friend supposed to do with the cash portion of his portfolio? My general thinking would be: 40% developed world markets, 10% emerging markets, 40% bond funds and 10% cash. The reason is that this gives him an overall 75% equity and 25% fixed income (remember, half his assets is still in that highly concentrated portfolio!). If you want to get more sophisticated you can slice and dice and eliminate the US components of the index, since that's already taken care of by the concentrated position (though I don't generally think that's a good idea, since if you have all your US holdings in one stock, it's quite possible for that one stock to do badly while the rest of the US goes on merrily on its way).
This should grant reasonable protection against a crash in equity markets or rampant inflation. Given that such a person is already able to live off of less than 1% of his assets, this makes his already relatively safe position even safer. Comments on this analysis is welcome.
John Doerr Visits Google
I had the pleasure on Thursday of listening to John Doerr talk about global warming when he visited Google. This was a rehash of his TED talk linked to in the title of this post. He goes through many of the things we already know: getting the consumer to do the right thing without price signals is next to impossible (hence the need for a carbon tax), how Brazil transitioned to a largely fossil-fuel free transportation system, and what the upcoming technologies are.
Just as John Lovelock was, John Doerr is pessimistic. This is important, because by nature, venture capitalists are pretty much the most optimistic people on the planet. They have to be --- at least 50% of the companies they fund are outright failures. So if he's pessimistic, then I think Lovelock is right: the chances of Earth having an environment that human beings will find pleasant in 2050 is less than 50%.
Nevertheless, I had a few questions in my head as I left the talk:
If someone as aware of the problem as Mr. Doerr is can't change his lifestyle despite knowing of the problems, what hope do we have of convincing the world that we have to do something about this?
Just as John Lovelock was, John Doerr is pessimistic. This is important, because by nature, venture capitalists are pretty much the most optimistic people on the planet. They have to be --- at least 50% of the companies they fund are outright failures. So if he's pessimistic, then I think Lovelock is right: the chances of Earth having an environment that human beings will find pleasant in 2050 is less than 50%.
Nevertheless, I had a few questions in my head as I left the talk:
- When the partners at KPCB flew around the world to observe the effects of climate change first hand, did they fly coach? Or did they fly in their private jets, adding to the problem?
- Did Mr. Doerr change his lifestyle when he learned of the problem? Or does he still drive a big fast car to work?
If someone as aware of the problem as Mr. Doerr is can't change his lifestyle despite knowing of the problems, what hope do we have of convincing the world that we have to do something about this?
Tax planning II
Hoisted from the comments, Brad Delong style:
i was just thinking about your "tail wagging the dog" thing and wondering if that is true, why does it makes sense to put money in tax-exempt funds?
I have been slashing my savings in CA tax-exempt MMF but I am confused if that is the right thing to do. Any suggestions?
Thank you for your question.
There's a difference between tax aware investing and "tax tail wagging the investment dog" thinking.
Here's a good example of tax aware stock selling. The author clearly has thought through the issues and understands the risk of selling late. An example I can think of is the "tax tail wagging the investment dog" thinking is that of a conversation I had recently with someone who had a majority of her wealth tied up in her company stock options, which had hit a record high. Despite her awareness of that, her reason for not selling was: "I don't want to pay the capital gains tax." Given that a majority of her assets were in the form of NSOs, she would have to pay those taxes sooner or later, while the consequences of a 50% drop in a high flying stock on her wealth would be substantial.
Back to the your question. Putting money into a CA tax-exempt fund makes sense when your marginal tax rate is high enough that the reduced yield of the CA tax exempt fund after taxes is higher than that of the best non-tax exempt fund you can find.
To do this, first find your marginal tax rate, then visit the Vanguard after-tax equivalent yield calculator. You probably already know your marginal tax rate for your state (CA), but in case you don't, here's the table.
Here now is a puzzler for you financial gurus: A person I know just quit his job to move to another (income-tax free) state. His reasoning: "I have enough money in my stock stash to retire (barely), but my margin of safety goes up by about 9.3% if I move to a state with no income tax when I sell. So I'll change residency and do my selling then." Note that again, his portfolio is highly concentrated in one stock. Would this be considered tax-aware stock selling? I have my opinion, but I'm interested in what others might think.
i was just thinking about your "tail wagging the dog" thing and wondering if that is true, why does it makes sense to put money in tax-exempt funds?
I have been slashing my savings in CA tax-exempt MMF but I am confused if that is the right thing to do. Any suggestions?
Thank you for your question.
There's a difference between tax aware investing and "tax tail wagging the investment dog" thinking.
Here's a good example of tax aware stock selling. The author clearly has thought through the issues and understands the risk of selling late. An example I can think of is the "tax tail wagging the investment dog" thinking is that of a conversation I had recently with someone who had a majority of her wealth tied up in her company stock options, which had hit a record high. Despite her awareness of that, her reason for not selling was: "I don't want to pay the capital gains tax." Given that a majority of her assets were in the form of NSOs, she would have to pay those taxes sooner or later, while the consequences of a 50% drop in a high flying stock on her wealth would be substantial.
Back to the your question. Putting money into a CA tax-exempt fund makes sense when your marginal tax rate is high enough that the reduced yield of the CA tax exempt fund after taxes is higher than that of the best non-tax exempt fund you can find.
To do this, first find your marginal tax rate, then visit the Vanguard after-tax equivalent yield calculator. You probably already know your marginal tax rate for your state (CA), but in case you don't, here's the table.
Here now is a puzzler for you financial gurus: A person I know just quit his job to move to another (income-tax free) state. His reasoning: "I have enough money in my stock stash to retire (barely), but my margin of safety goes up by about 9.3% if I move to a state with no income tax when I sell. So I'll change residency and do my selling then." Note that again, his portfolio is highly concentrated in one stock. Would this be considered tax-aware stock selling? I have my opinion, but I'm interested in what others might think.
Friday, November 02, 2007
Farseer Trilogy
Over the years, these books' have been staring in my face, daring me to actually read them and me always putting them off because well, they looked utterly boring. Oh boy, yet another fantasy trilogy about assassins...big whoop.
I think I must have read one of them a few chapters and got utterly bored. Because I think the second book have sat on my bookshelf for at least 3 years or so.
Well, I was out of reading material and decided to try it again. And well...2 weeks and close to 1,200 pages later, I'm done with the Trilogy.
There are two things that I'm particularly concerned about when I read any fantasy novels, and that's basically writing style, and story pace. Story content is a given, but I'm far more forgiving of a story content that's been retold multiple times but in a different manner than say, of weak writing or weak pacing. I won't bother with story content because you can get the summary from Amazon.com, and frankly, its not particularly original nor unique.
So at least in the two categories I care about, the Farseer trilogy is pretty good.
The writing style of Robin Hobbs is a little peculiar, if a bit verbose. She tends to love describing things, going on and on about the lushness of a particular forest, or the fragrance of a particular dish. She doesn't have any pet remarks like Robert Jordan did (tug braids, smooth skirts...), but all the same, you do start glossing over her verbosity when it comes to descriptions after the first 200 pages or so. Some editing would probably have helped as the first book weighs in around 300 pages, the second at 500 pages, and the last close to 600 I believe.
The entirety of the trilogy is also written in the first person, from the point of view of the protagonist. As it is, it serves quite well for the high fantasy world she's put the protagonist in . The reader finds out information at pretty much the same time as the protagonist. Hence you get to see that the world building is quite well done, and the magic system reasonably believable.
The pacing of the story is quite intense. I found myself flipping the pages as there's rarely a dull moment unless she got into the mood to start discourse on the lushness of a certain area.
The one major gripe I have about the series is that characters do fairly retarded things. Trusting characters are often potrayed as little more than idiots when it comes to trusting the wrong people...Clearly, her characters never learned the proverb "once bitten twice shy"
All in all, a trilogy that I found worth reading...it didn't radically change the landscape of high fantasy, but its still a good series in its own rights and i don't regret at all the time I spent on it.
I think I must have read one of them a few chapters and got utterly bored. Because I think the second book have sat on my bookshelf for at least 3 years or so.
Well, I was out of reading material and decided to try it again. And well...2 weeks and close to 1,200 pages later, I'm done with the Trilogy.
There are two things that I'm particularly concerned about when I read any fantasy novels, and that's basically writing style, and story pace. Story content is a given, but I'm far more forgiving of a story content that's been retold multiple times but in a different manner than say, of weak writing or weak pacing. I won't bother with story content because you can get the summary from Amazon.com, and frankly, its not particularly original nor unique.
So at least in the two categories I care about, the Farseer trilogy is pretty good.
The writing style of Robin Hobbs is a little peculiar, if a bit verbose. She tends to love describing things, going on and on about the lushness of a particular forest, or the fragrance of a particular dish. She doesn't have any pet remarks like Robert Jordan did (tug braids, smooth skirts...), but all the same, you do start glossing over her verbosity when it comes to descriptions after the first 200 pages or so. Some editing would probably have helped as the first book weighs in around 300 pages, the second at 500 pages, and the last close to 600 I believe.
The entirety of the trilogy is also written in the first person, from the point of view of the protagonist. As it is, it serves quite well for the high fantasy world she's put the protagonist in . The reader finds out information at pretty much the same time as the protagonist. Hence you get to see that the world building is quite well done, and the magic system reasonably believable.
The pacing of the story is quite intense. I found myself flipping the pages as there's rarely a dull moment unless she got into the mood to start discourse on the lushness of a certain area.
The one major gripe I have about the series is that characters do fairly retarded things. Trusting characters are often potrayed as little more than idiots when it comes to trusting the wrong people...Clearly, her characters never learned the proverb "once bitten twice shy"
All in all, a trilogy that I found worth reading...it didn't radically change the landscape of high fantasy, but its still a good series in its own rights and i don't regret at all the time I spent on it.
Sunday, October 28, 2007
Berkeley Hills Ride
Joining Matt Blain and I at the start was David Reiss and Greg Merritt. Matt went to use the restroom, and we got started because I wanted to go use a porta-portee instead. Matt and Sandor met us at the park with the porta-portees and we rode up together to Tunnel road.
Sandor set a blistering pace up Tunnel road and soon we had dropped David and Matt. The weather was clear and beautiful, but the haze (probably from the SD fires) restricted visibility. Nevertheless, it was a big improvement from the fog that greeted us on this ride.
At the intersection with Alhambra Valley Road, we opted for the longer ride, and Greg pulled us for a bit before taking off to do some shopping with his daughter. We then made our way over to Pinole and Richmond, riding by the ugly refineries before coming over along the Carquinez Straits to climb McEwen road.
It had been 2 years since I last climbed McEwen Road, and I'd forgotten how pleasantly shaded it was, and we made our way over to Franklin Canyon road. Franklin Canyon road is rough enough to provide a gratituous butt massage, and then we ended up rejoining the "C" route on Reliez Valley road. By this time I was feeling the effort or the ride, and had slowed considerably. Fortunately, Sandor was happy to slow for me.
At Moraga Center, I knew I was in trouble when after sitting down for 3 minutes I tried to get up again and saw stars instead. Fortunately, a bit of food and water and all the endurolytes I could eat cleared my vision. Nevertheless, the climb up Pinehurst was slow, and the climb along Skyline to Tunnel road took all that I had left. The descent down Tunnel road, however, with the gorgeous bay views and the
easy riding re-energized me, and we made it down to the car at 4:30pm. Matt had been waiting for a couple of hours and told me that the "easy 35 miler" had turned out to be closer to 45. Since Matt's the first person to have ever completed that ride, I'll have to fix the route sheet for next time. David had gotten onto the BART at Lafayette after just 24 miles. Of course, those 24 miles had probably clocked in at 4500' of climbing.
Sandor set a blistering pace up Tunnel road and soon we had dropped David and Matt. The weather was clear and beautiful, but the haze (probably from the SD fires) restricted visibility. Nevertheless, it was a big improvement from the fog that greeted us on this ride.
At the intersection with Alhambra Valley Road, we opted for the longer ride, and Greg pulled us for a bit before taking off to do some shopping with his daughter. We then made our way over to Pinole and Richmond, riding by the ugly refineries before coming over along the Carquinez Straits to climb McEwen road.
It had been 2 years since I last climbed McEwen Road, and I'd forgotten how pleasantly shaded it was, and we made our way over to Franklin Canyon road. Franklin Canyon road is rough enough to provide a gratituous butt massage, and then we ended up rejoining the "C" route on Reliez Valley road. By this time I was feeling the effort or the ride, and had slowed considerably. Fortunately, Sandor was happy to slow for me.
At Moraga Center, I knew I was in trouble when after sitting down for 3 minutes I tried to get up again and saw stars instead. Fortunately, a bit of food and water and all the endurolytes I could eat cleared my vision. Nevertheless, the climb up Pinehurst was slow, and the climb along Skyline to Tunnel road took all that I had left. The descent down Tunnel road, however, with the gorgeous bay views and the
easy riding re-energized me, and we made it down to the car at 4:30pm. Matt had been waiting for a couple of hours and told me that the "easy 35 miler" had turned out to be closer to 45. Since Matt's the first person to have ever completed that ride, I'll have to fix the route sheet for next time. David had gotten onto the BART at Lafayette after just 24 miles. Of course, those 24 miles had probably clocked in at 4500' of climbing.
Saturday, October 27, 2007
Is it too late to join this hot startup?
I occasionally get questions like: "Is it too late to make a lot of money by joining company X?" This is very silly, because if you've already interviewed with the company, you'll know the situation better than I would, and therefore, you'll know better than I would.
Having said that, there's a very old adage, which is that it's better to have a small piece of a big pie than a big piece of a small pie. Too many people forget that, thinking that they'd rather join a smaller startup (or one that has a smaller valuation) than to join one that's already rather established. Believe it or not, even in early 2004 pre-IPO, I had a hard time persuading engineers that no, it wasn't too late to join Google and still make a lot of money.
And of course, if you do really well at Google, the founder's awards, bonuses, and so on will make you wealthy, so if you're really really smart, joining a big company like Google even at a very late stage makes a lot of sense. You'll work hard and climb the ladder, and Google has the resources to reward you at levels most startups can only dream of.
I joined Google in 2003. When I joined, I was told the company was valued at $X. I called up one of my VC friends and asked if he thought Google was worth that much. He said, "No matter how much the valuation, trust me, it is far below what the market will actually pay." That VC friend, by the way, is now at a certain hot Silicon Valley startup with what many would consider insane valuations. And that's typical of most Silicon Valley startups. So no, if the company you're talking about is a pre-IPO company, no matter how lofty the valuation you might have been told or talked about, if the company is successful, it is not too late. The key, of course, is whether the company will be successful (which is in the long term more important than anything else). And if I could predict that, I probably would have had a career doing things other than writing software.
There is another secret about startup stock options that not many know, and I won't say much about it because then it'll become common knowledge, but suffice to say, it's one of the few games where the game is actually rigged in your favor, if only you had the courage to take advantage of it.
Having said that, there's a very old adage, which is that it's better to have a small piece of a big pie than a big piece of a small pie. Too many people forget that, thinking that they'd rather join a smaller startup (or one that has a smaller valuation) than to join one that's already rather established. Believe it or not, even in early 2004 pre-IPO, I had a hard time persuading engineers that no, it wasn't too late to join Google and still make a lot of money.
And of course, if you do really well at Google, the founder's awards, bonuses, and so on will make you wealthy, so if you're really really smart, joining a big company like Google even at a very late stage makes a lot of sense. You'll work hard and climb the ladder, and Google has the resources to reward you at levels most startups can only dream of.
I joined Google in 2003. When I joined, I was told the company was valued at $X. I called up one of my VC friends and asked if he thought Google was worth that much. He said, "No matter how much the valuation, trust me, it is far below what the market will actually pay." That VC friend, by the way, is now at a certain hot Silicon Valley startup with what many would consider insane valuations. And that's typical of most Silicon Valley startups. So no, if the company you're talking about is a pre-IPO company, no matter how lofty the valuation you might have been told or talked about, if the company is successful, it is not too late. The key, of course, is whether the company will be successful (which is in the long term more important than anything else). And if I could predict that, I probably would have had a career doing things other than writing software.
There is another secret about startup stock options that not many know, and I won't say much about it because then it'll become common knowledge, but suffice to say, it's one of the few games where the game is actually rigged in your favor, if only you had the courage to take advantage of it.
Review: Acacia Book One: The War Against the Mein
I was first turned onto Acacia through John Scalzi's blog. In it, he mentioned he had an interview with David Anthony Durham in which the following caught my eye:
...I’m quite confident that if readers think about it for a while – or remember to think about it as they read in the future – it won’t be long before they’ll come across numerous examples of white-only fantasy worlds, or white-mainly future worlds, or note current prejudices appearing in different guises…
Consider if that would ever happen in the work of a black writer. The prejudice part might, but the one race only world likely wouldn’t. As a person of color he/she would have spent a lifetime being aware of race on a day by day, hour by hour basis. If this black writer did create an all-black future or fantasy world white readers (if there were any) would likely find it improbable, limited, some sort of minority wish-fulfillment, or think it suggestive of some deep-seated racial animus – perhaps called racism...
And gosh darn it he is absolutely absolutely right. Lord of The Rings was 100% lily-white in its heroes, down to the Elves and Dwarves, as is a lot of even pretty modern fantasy. So I put Acacia down on my to-read list, to see if a black author would do better.
Acacia starts with an perhaps archetypal plot: the old King is assassinated, the foreigners have invaded the land, and the children have been scattered to the winds, only to return later to take revenge for their now dead parent. The twists, however, are very very entertaining. First, Durham makes the villains of the tales white people with fair skins, blond hair, and blue eyes. It's one thing to think about it in abstract, but the first time you realize it you're thrown a bit for a loop, because it is so infrequently done in fantasy literature.
Then, as the plot unfolds, the barbarians at the gate turn out to have an old score to settle for themselves. The children do turn out as you might expect, each of them developing into very strong adults and characters, with Alivier, the oldest of them all becoming as much a prophet as he is a warrior, seeking to not only return his family to power, but to rebuild the empire to redeem the ills of Acacia's past: an empire support by drugs, slavery, and not a little bit of oppression. The ending of the book is also altogether unexpected, and one should not expect the typical hero's quest.
All this would be for naught if Durham was not a writer of exceptional skill. His prose is a dream to read. Here's an action sequence:
Thasren drew his dagger from hiding. He sliced it diagonally away from his body, a movement so fast it drew many eyes. The blade reflected shards of lamplight, a sharp thing in a hand that should bear no sharp thing. He dashed the last few steps forward. The king's eyes turned towards him, puzzled, mouth puckered as if about to pronounce the ambassador's name.
This rhythm and the clarity of phrasing runs throughout the entire novel. It is a very seductive voice, and it carries you in, page after page.
The world building is also excellent, with a creation myth that echoes of Ursula Le Guin's Earthsea quartet. And of course, there's a lot of diversity in the characters. Brown people, olive people, black people are all there in the book, something not often seen in fantasy literature. Whatever else you can say, Durham has definitely achieved his goals.
Highly recommended, and worth buying at full price if your local library does not carry this book.
...I’m quite confident that if readers think about it for a while – or remember to think about it as they read in the future – it won’t be long before they’ll come across numerous examples of white-only fantasy worlds, or white-mainly future worlds, or note current prejudices appearing in different guises…
Consider if that would ever happen in the work of a black writer. The prejudice part might, but the one race only world likely wouldn’t. As a person of color he/she would have spent a lifetime being aware of race on a day by day, hour by hour basis. If this black writer did create an all-black future or fantasy world white readers (if there were any) would likely find it improbable, limited, some sort of minority wish-fulfillment, or think it suggestive of some deep-seated racial animus – perhaps called racism...
And gosh darn it he is absolutely absolutely right. Lord of The Rings was 100% lily-white in its heroes, down to the Elves and Dwarves, as is a lot of even pretty modern fantasy. So I put Acacia down on my to-read list, to see if a black author would do better.
Acacia starts with an perhaps archetypal plot: the old King is assassinated, the foreigners have invaded the land, and the children have been scattered to the winds, only to return later to take revenge for their now dead parent. The twists, however, are very very entertaining. First, Durham makes the villains of the tales white people with fair skins, blond hair, and blue eyes. It's one thing to think about it in abstract, but the first time you realize it you're thrown a bit for a loop, because it is so infrequently done in fantasy literature.
Then, as the plot unfolds, the barbarians at the gate turn out to have an old score to settle for themselves. The children do turn out as you might expect, each of them developing into very strong adults and characters, with Alivier, the oldest of them all becoming as much a prophet as he is a warrior, seeking to not only return his family to power, but to rebuild the empire to redeem the ills of Acacia's past: an empire support by drugs, slavery, and not a little bit of oppression. The ending of the book is also altogether unexpected, and one should not expect the typical hero's quest.
All this would be for naught if Durham was not a writer of exceptional skill. His prose is a dream to read. Here's an action sequence:
Thasren drew his dagger from hiding. He sliced it diagonally away from his body, a movement so fast it drew many eyes. The blade reflected shards of lamplight, a sharp thing in a hand that should bear no sharp thing. He dashed the last few steps forward. The king's eyes turned towards him, puzzled, mouth puckered as if about to pronounce the ambassador's name.
This rhythm and the clarity of phrasing runs throughout the entire novel. It is a very seductive voice, and it carries you in, page after page.
The world building is also excellent, with a creation myth that echoes of Ursula Le Guin's Earthsea quartet. And of course, there's a lot of diversity in the characters. Brown people, olive people, black people are all there in the book, something not often seen in fantasy literature. Whatever else you can say, Durham has definitely achieved his goals.
Highly recommended, and worth buying at full price if your local library does not carry this book.
Friday, October 26, 2007
Interview with Paul Krugman
This is a great interview with Paul Krugman. I think he is one of the best thinkers/political columnists of our generation. He has been right about so many things --- inequality, George Bush, the Iraq war, and now his latest book, about the recent success of the Republicans (mainly due to racism) will probably be vindicated in a few years. It must have been tough being the only guy in popular media to be constantly writing about what a shambles Bush's policies were back in 2001 at the height of Bush's popularity, but once again, being right trumps everything else.
Monday, October 22, 2007
James Lovelock thinks global warming is irreversible
Lovelock's pessimism mirrors my own. Again and again, we see humans take the easy, convenient solution over the tougher ones. It's easier to drive the car than to walk or ride your bike. It's easier to drive your kids to school than to teach them to walk to school. Lovelock might be right, but it's not going to stop me from doing what I can, and ultimately, what else can we do?
Articles like this remind me why I decided years ago that the proper recipient of any charitable donations from me should to environmentalism rather than humanitarian aid. Without an environment that can support human life, no amount of developmental aid will help the human condition. Environmentalism isn't about saving the planet --- it's about saving the human race, which I think is the ultimate humanitarian aid.
Lovelock knows that predicting the end of civilization is not an exact science. "I could be wrong about all this," he admits as we stroll around the park in Norway. "The trouble is, all those well-intentioned scientists who are arguing that we're not in any imminent danger are basing their arguments on computer models. I'm basing mine on what’s actually happening."
Articles like this remind me why I decided years ago that the proper recipient of any charitable donations from me should to environmentalism rather than humanitarian aid. Without an environment that can support human life, no amount of developmental aid will help the human condition. Environmentalism isn't about saving the planet --- it's about saving the human race, which I think is the ultimate humanitarian aid.
Lovelock knows that predicting the end of civilization is not an exact science. "I could be wrong about all this," he admits as we stroll around the park in Norway. "The trouble is, all those well-intentioned scientists who are arguing that we're not in any imminent danger are basing their arguments on computer models. I'm basing mine on what’s actually happening."
Sailing on the Bay (again)
An absolutely gorgeous day on the bay yesterday. Stunning visibility. Not too much wind at first, but it picked up at the end. What a lovely weekend it's been! So warm and lovely.
Sunday, October 21, 2007
Fall Ride
Pardo, Brian Wickman, Zoran and I met at 9:15 at my place, and rode up McClellan, Stevens Canyon, and then Redwood Gulch. Fall was in full swing as trees were shedding leaves all around us. A gentle wind would swirl them around us as we climbed the slightly damp pavement. Highway 9 was a cinch after that, and we started down the cold side of Saratoga gap. I was quickly passed by both Brian and Zoran, both spinning hard to stay warm, but soon enough, we started climbing Hwy 236. It was cool enough that I kept my shell and knee warmers on for the climb, and soon we were in Big Basin where after a brief discussion we decided to eat lunch in Boulder Creek. The climb out of Big Basin was lovely as usual, with the smell of redwoods in the air, and a few open camp fires granting us that rustic feel. The drop into Boulder Creek was fast and fun, and there we bought lunch and ate at the usual city park around the corner.
Bear Creek road had unusually light traffic during the initial bumps and swoops before crossing over the bridge for the start of the real climb. Past the first winery, however, the road levels out and you start getting clear glimpses of the coast. On Saturday, the visibility was so high that we could see all the way to Monterey Bay and Big Sur from the summit of Bear Creek road. At the junction of Skyline we made a left and went up the rolling climb to Black Road, where we eschewed
the descent to the Los Gatos Creek trail and kept going back towards Saratoga Gap, stopping only at the view point for another inspection of Monterey Bay from a distance. We then descended to Saratoga Gap where Brian left us to descend Page Mill and the rest of us descended Highway 9, Pierce, and back to my place. Zoran had a flat just 2 miles from the end, but it was fixed and we had Mexican dinner at the
Burrito factory.
70 miles, approximately 7000' of climb.
Bear Creek road had unusually light traffic during the initial bumps and swoops before crossing over the bridge for the start of the real climb. Past the first winery, however, the road levels out and you start getting clear glimpses of the coast. On Saturday, the visibility was so high that we could see all the way to Monterey Bay and Big Sur from the summit of Bear Creek road. At the junction of Skyline we made a left and went up the rolling climb to Black Road, where we eschewed
the descent to the Los Gatos Creek trail and kept going back towards Saratoga Gap, stopping only at the view point for another inspection of Monterey Bay from a distance. We then descended to Saratoga Gap where Brian left us to descend Page Mill and the rest of us descended Highway 9, Pierce, and back to my place. Zoran had a flat just 2 miles from the end, but it was fixed and we had Mexican dinner at the
Burrito factory.
70 miles, approximately 7000' of climb.
Friday, October 19, 2007
How to be lucky
This is a great article, and I think it really demystifies the connection between luck, success, and ability. I'll provide a few anecdotes:
My social network of friends and people I know have been priceless to me over the last years. Opening yourself up to these opportunities and leaving your comfort zone is essential to both becoming lucky and successful. Even Scott Adams agrees, so it must be true.
- When I first joined Google, I spoke to many people about the smartest thing they could have done right away when they joined: exercise their stock options. Many folks, despite my explanation of why it made sense, chose not to do so. They just couldn't grasp the idea that they could be financially sophisticated and be successful.
- I will discuss my trips with some people. Many of them would tell me, "What a wonderful trip!" Yet the next time I invited them along on a trip, they would say, "No. Too busy."
- I called a friend of mine several years ago hoping to recruit him for Google. His first words were, "Darn it! I should have called you once I decided to start interviewing. I've already accepted an offer at Amazon."
- A few years ago, I started up a D&D game and met a bunch of folks at random to play. Three of them turned out to work at Google, and after a year or so of gaming with these folks, I ended up working there as well.
My social network of friends and people I know have been priceless to me over the last years. Opening yourself up to these opportunities and leaving your comfort zone is essential to both becoming lucky and successful. Even Scott Adams agrees, so it must be true.
Review: Take a Nap! Change your life.
Sleep is critically important, and Americans are frequently sleep deprived. I know this not just from the scientific studies that are frequently published, but from personal experience --- I started college as a "normally smart" student, but at the end of four years, I was doing far better than I expected --- most of my cohorts regularly pulled all nighters to study for exams while I got myself a good night's sleep and ended up doing better (there's an argument that maybe they were all drunk on alcohol, but since I was studying computer science the number of party animals I could compare myself with was limited). My long term memory was better, and hence I did better.
Sara Mednick's thesis in this book is that humans naturally have bi-phasic sleep. In other words, left to ourselves, we'll get in two sleep cycles in a day, one long one at night, and one shorter one at mid-day. The evidence she marshals to convince us that napping is natural and good for us is considerable: the studies basically show that the increased alertness, memory, and learning are considerable after the nap, quite possibly more than making up for the lost time spent napping. These studies are convincing, but in her presentation at Google, she reminded us that sleep is a very young science --- there is also some evidence that exercise can also result in the same increase in productivity, so we don't know if it's the state change in your head that causes the increase in mental alertness, or whether sleep itself does something.
There are a few gimmicks in this book, one of which is the sleep wheel on the cover. You turn it to when you woke up this morning, and it tells you when to sleep for an optimum mix of stage 1 sleep, stage 2, sleep, and deep, slow wave sleep, with a reminer of what each stage does. Scattered throughout the book are also a bunch of case studies of how people use napping (and what kind of napping is used) to change their lives for the better.
I did ask a question when Sara visited, which was whether napping was recommended for people with sleep apnea. Apparently, no studies of napping for people with apnea have been done, so it might even be dangerous for people with apneas. Such a young science that even I can ask unanswered questions! Clearly, more funding is needed for this.
Obviously, the ultimate test of this book is whether or not it works. And unfortunately, I can't tell you. I work in a fantastic environment by most standards, but privacy and enough time to sleep is definitely not one of them. This would be a worthwhile experiment for those who are self-employed, or who have offices with doors they can close. Hm... Maybe Microsoft engineers can make this experiment. But seriously though, for athletes, the benefits of napping are not in doubt whatsoever.
Recommended with the above caveats.
Sara Mednick's thesis in this book is that humans naturally have bi-phasic sleep. In other words, left to ourselves, we'll get in two sleep cycles in a day, one long one at night, and one shorter one at mid-day. The evidence she marshals to convince us that napping is natural and good for us is considerable: the studies basically show that the increased alertness, memory, and learning are considerable after the nap, quite possibly more than making up for the lost time spent napping. These studies are convincing, but in her presentation at Google, she reminded us that sleep is a very young science --- there is also some evidence that exercise can also result in the same increase in productivity, so we don't know if it's the state change in your head that causes the increase in mental alertness, or whether sleep itself does something.
There are a few gimmicks in this book, one of which is the sleep wheel on the cover. You turn it to when you woke up this morning, and it tells you when to sleep for an optimum mix of stage 1 sleep, stage 2, sleep, and deep, slow wave sleep, with a reminer of what each stage does. Scattered throughout the book are also a bunch of case studies of how people use napping (and what kind of napping is used) to change their lives for the better.
I did ask a question when Sara visited, which was whether napping was recommended for people with sleep apnea. Apparently, no studies of napping for people with apnea have been done, so it might even be dangerous for people with apneas. Such a young science that even I can ask unanswered questions! Clearly, more funding is needed for this.
Obviously, the ultimate test of this book is whether or not it works. And unfortunately, I can't tell you. I work in a fantastic environment by most standards, but privacy and enough time to sleep is definitely not one of them. This would be a worthwhile experiment for those who are self-employed, or who have offices with doors they can close. Hm... Maybe Microsoft engineers can make this experiment. But seriously though, for athletes, the benefits of napping are not in doubt whatsoever.
Recommended with the above caveats.
Tax Planning and other financial matters
I do occasionally help people out with financial planning. A surprising number of folks at work seem to already have one (I can't imagine justifying the expenditure on one, given that by the time you're knowledgeable enough to interview one you know enough to do it yourself), and I only do it for friends (liability reasons), but once in a while a topic will come out that I think is worth repeating.
The most important principle is that the tax tail should not wag the income dog. There is no such thing as a 100% tax rate in industrial world, so you'll always keep quite a bit of what you make. The best advise I was given by a tax accountant was: "Sell high. No matter what you do with your taxes, you can never beat selling high." I paid the guy $250 in 1995 to explain the AMT, and capital gains taxes to me and it's been worth every penny and saved me and some of my friends gobs of money. In fact, one day I ran into Niniane and one of her beaus and she introduced me as "the guy who saved her lots of money in taxes."
That said, it's surprisingly how little you can actually do to save on taxes:
The most important principle is that the tax tail should not wag the income dog. There is no such thing as a 100% tax rate in industrial world, so you'll always keep quite a bit of what you make. The best advise I was given by a tax accountant was: "Sell high. No matter what you do with your taxes, you can never beat selling high." I paid the guy $250 in 1995 to explain the AMT, and capital gains taxes to me and it's been worth every penny and saved me and some of my friends gobs of money. In fact, one day I ran into Niniane and one of her beaus and she introduced me as "the guy who saved her lots of money in taxes."
That said, it's surprisingly how little you can actually do to save on taxes:
- Join a pre-IPO company and exercise all your stock options. This usually involves substantial risk --- I've written off thousands of dollars in bad stock. But a college professor in Computer Science and I were comparing compensation and it turned out that he got paid about the same as I did, and the big difference was that I was able to convert most of my income into capital gains through this maneuver while he couldn't do so through his consulting business.
- Move to a low state tax. For me to give up California weather, that would be silly. I have friends who have done so, but if I wouldn't consider myself wealthy if I couldn't live some place with good weather. The folks I know who've done this don't consider an outdoor life important to them. If you're not a US citizen you can even move somewhere with zero capital gains taxes (like Singapore) and pay no capital gains on US stock. Pretty nice, huh? Except I've lived in Singapore and I moved away for very good reasons that are still valid.
- Use tax managed funds and indexed funds whenever possible for your taxable portfolio when investing
- Max out your 401(k) plans
- Buy a house (but not too much house that it destroys your finances). But frankly, buying a house is a consumption decision, not a tax decision. Do not let people talk you into owning a house because of tax savings! Someone I know had this happen to her and deeply regrets it. Fortunately, she won't be affected financially by this, if at all, but many others will not be as lucky!
Tuesday, October 16, 2007
You cannot outsource financial work
One of my favorite financial bloggers, PFBlog writes about spending 10 hours a year on his taxes despite his employer, Microsoft, paying for KPMG to file his taxes for him (what a great perk!). I have lots of friends who pay accountants despite not having taxes as complicated as his.
Like him, I always do my taxes (I also do a few other people's), and I find that it is essential in order to understand the overall picture behind taxes, how they work, and what changes year after year. On top of that, by doing taxes yourself in TurboTax, you also gain access to the wonderful tax audit protection service provided by Tax Resources, Inc at an amazing price.
My aunt is an accountant, and despite her years spent preparing taxes for corporations, TurboTax outperforms her in terms of getting money back. Outsourcing your taxes is a lot like outsourcing your financial planning: without a clear understanding of what you are doing, you will not get satisfactory results.
Like him, I always do my taxes (I also do a few other people's), and I find that it is essential in order to understand the overall picture behind taxes, how they work, and what changes year after year. On top of that, by doing taxes yourself in TurboTax, you also gain access to the wonderful tax audit protection service provided by Tax Resources, Inc at an amazing price.
My aunt is an accountant, and despite her years spent preparing taxes for corporations, TurboTax outperforms her in terms of getting money back. Outsourcing your taxes is a lot like outsourcing your financial planning: without a clear understanding of what you are doing, you will not get satisfactory results.
Monday, October 15, 2007
US Productivity Slowing
People like Paul Graham are big fans of inequality. Reading his essays, one feels like if we could only return to the levels of inequality found in the gilded age (or in India or Argentina or Brazil of today), productivity would improve dramatically and we'll generate more wealth than ever before.
Modern economics research, however, gives the lie to this sort of right wing propaganda. (Modern happiness studies too, show that countries where the Gini coefficient is low are happier societies)
Even worse: The productivity numbers are likely even worse than they look. The most important reason is that the official productivity figures don't handle the rapid depreciation of new technology very well.
As Paul Krugman writes in his latest blog entry, you have to squint to spot the so-called lagging of the European socialist economies with respect to U.S. productivity.
Modern economics research, however, gives the lie to this sort of right wing propaganda. (Modern happiness studies too, show that countries where the Gini coefficient is low are happier societies)
Even worse: The productivity numbers are likely even worse than they look. The most important reason is that the official productivity figures don't handle the rapid depreciation of new technology very well.
As Paul Krugman writes in his latest blog entry, you have to squint to spot the so-called lagging of the European socialist economies with respect to U.S. productivity.
Sunday, October 14, 2007
Review: Order of the Stick Print Comics
D&D players have always been insecure. My favorite example is that over in the Enworld Forums, every so often there'll be a thread about how D&D or Role Playing Games (RPGs) are losing players and becoming an extinct species.
The evidence, however, is that D&D is going strong, and the number one exhibit for that case has to be the Order of the Stick web-comics, which make so many D&D references (right down to edition changes) that most geeks wouldn't even bother reading it unless they were D&D players.
The Order of the Stick has become so popular that it has spawned two print-only books:
On the Origin of the PCs introduces the player characters, or rather, the protagonists. In black and white (to lower costs, and to reflect the flash-back nature of the story), it provides the back story behind each of the protagonists and their coming together. Along the way, it makes fun of the usual D&D tropes (dark strangers in taverns anyone?), as well as the usual jabs at the D&D rules. While I think it falls short of being as funny as the web-comic, it is still very funny.
Start of Darkness details the villains, and surprisingly enough, was more interesting than the protagonists. Though as any DM who has spent gobs of time detailing the backstory of his villains who rarely survive more than one encounter with the PCs will tell you, this is all too common. In particular, the goblin known as "Redcloak" has a tragic story and this makes the web comic even more entertaining.
As you might have guessed, you can read most of these on-line, but you're not going to enjoy these comics unless you like D&D, and if you are not a current player, you will miss many jokes and references. But yes, Scarlet, I expect you are current enough to get most of the jokes.
The evidence, however, is that D&D is going strong, and the number one exhibit for that case has to be the Order of the Stick web-comics, which make so many D&D references (right down to edition changes) that most geeks wouldn't even bother reading it unless they were D&D players.
The Order of the Stick has become so popular that it has spawned two print-only books:
On the Origin of the PCs introduces the player characters, or rather, the protagonists. In black and white (to lower costs, and to reflect the flash-back nature of the story), it provides the back story behind each of the protagonists and their coming together. Along the way, it makes fun of the usual D&D tropes (dark strangers in taverns anyone?), as well as the usual jabs at the D&D rules. While I think it falls short of being as funny as the web-comic, it is still very funny.
Start of Darkness details the villains, and surprisingly enough, was more interesting than the protagonists. Though as any DM who has spent gobs of time detailing the backstory of his villains who rarely survive more than one encounter with the PCs will tell you, this is all too common. In particular, the goblin known as "Redcloak" has a tragic story and this makes the web comic even more entertaining.
As you might have guessed, you can read most of these on-line, but you're not going to enjoy these comics unless you like D&D, and if you are not a current player, you will miss many jokes and references. But yes, Scarlet, I expect you are current enough to get most of the jokes.
1:57:26 for 13.1 miles
Wow. Its been one year since I started on this journey of "lets see how many events I can do in a year" spree, and this is pretty much the last event I wanted to do. It started from last year's Rock n Roll San Jose and ended with this year's Rock n Roll San Jose. In between, I did a full marathon, a Europe bike trip, and was supposed to do a tri, but got sick the weekend of, so I skipped that.
But still, 3 events, and 1 long bike ride later, I can say I'm quite satisfied with my physical achievements this year. I believe I ran a slightly faster time last year, but this time I had a running partner, and that made a huge difference in the amount of fun I had.
This year's event was quite packed, and it'll be interesting to see exactly how many registered runners there are...I estimate around 12,000, but could be slightly more.
We started with the 2:00 pace group, who did not start at a 2:00 pace, I believe they were going at a closer to 1:50 pace, but around mile 6 or so, they slowed down while we sped up. Had a gel at the mile 6 water station and felt buzzed enough that mile 7 through 10 felt like a breeze. Mile 10 through 13 was a bit more painful and I started to feel a slight pain in my left feet while my partner's calves were starting to lock up a little.
In the end, we finished within 20 seconds of one another! And for her very first 1/2 marathon its an incredible achivement! Props to her!
Next up....I don't know whats next up, but I plan to keep on running 1/2s for a while to come.....Fulls, not so much. They're not as fun, and although more than twice the achivement, I think I might just be satisified with running a single full in this lifetime. =)
Until I convince myself otherwise of course. =)
The contrast between this year and last years is mostly in the matter of training. Last year I overtrained, and this year, I trained just right. Last year at the end, I felt like I could run another 6 miles, this year, around mile 13, I was very glad I only had one tenth of a mile to go...
I'm not sure if its a great thing or not, but I'm very very happy I finished under 2:00 still....
But still, 3 events, and 1 long bike ride later, I can say I'm quite satisfied with my physical achievements this year. I believe I ran a slightly faster time last year, but this time I had a running partner, and that made a huge difference in the amount of fun I had.
This year's event was quite packed, and it'll be interesting to see exactly how many registered runners there are...I estimate around 12,000, but could be slightly more.
We started with the 2:00 pace group, who did not start at a 2:00 pace, I believe they were going at a closer to 1:50 pace, but around mile 6 or so, they slowed down while we sped up. Had a gel at the mile 6 water station and felt buzzed enough that mile 7 through 10 felt like a breeze. Mile 10 through 13 was a bit more painful and I started to feel a slight pain in my left feet while my partner's calves were starting to lock up a little.
In the end, we finished within 20 seconds of one another! And for her very first 1/2 marathon its an incredible achivement! Props to her!
Next up....I don't know whats next up, but I plan to keep on running 1/2s for a while to come.....Fulls, not so much. They're not as fun, and although more than twice the achivement, I think I might just be satisified with running a single full in this lifetime. =)
Until I convince myself otherwise of course. =)
The contrast between this year and last years is mostly in the matter of training. Last year I overtrained, and this year, I trained just right. Last year at the end, I felt like I could run another 6 miles, this year, around mile 13, I was very glad I only had one tenth of a mile to go...
I'm not sure if its a great thing or not, but I'm very very happy I finished under 2:00 still....
Monday, October 08, 2007
Feeling wealthy
I've never felt wealthy. Not when I paid cash for my first car back in 1999 (near the height of the internet bubble). The benefit of that was that when the bubble burst in 2001, I didn't feel poor either.
I didn't feel wealthy when I wrote Google a check to exercise my stock options, a month after I started at the company, wiping out a couple of years worth of savings. (Yes, some loved ones did raise an eyebrow, but it was a safe investment, as safe as any such investment can be)
I didn't feel wealthy at Google's IPO. I did write a check to pay off my mom's mortgage, which was a rather smart move I was making the monthly payments anyway, and the mortgage was at 8% or so and refinancing was impossible since nobody wanted to refinance for so little money.
I didn't even feel wealthy when I started shopping for a custom frame. For someone who rides much more than he drives, even a new custom bike every year doesn't come close to the cost of a car.
But a few weeks ago Lisa and I decided to engage a cleaning service --- we were just overwhelmed by all the housework that we had to do that we just didn't enjoy doing. We weren't good at it, and we weren't good about it. And I looked at my assets and thought: "Ok, let's find out how much a cleaning service is, and throw money at the problem to make it go away." We asked the concierge at work for a recommendation, called him up, and he showed up to give us a quote last week, and they came by today and cleaned up the house.
Lisa's reaction at the results when she came home was one of amazement. She got on the phone with the housecleaning service and raved at the owner with praise for a good 20 minutes. I was pretty impressed. It felt like coming to a B&B, everything all laid out, the sinks polished, etc. So for the first time in our lives, at least, we felt wealthy.
The thing is, we live in a small Silicon Valley apartment. The quote for the service was embarrassingly small. We could have afforded it ages ago, but it always felt like a luxury, and indeed it is one. This little luxury, more than any object we've ever purchased, wasn't just an object, it was time away from doing things we didn't enjoy doing, yet done with amazing professionalism. So if you want to feel wealthy, treat yourself to a really good cleaning service.
I didn't feel wealthy when I wrote Google a check to exercise my stock options, a month after I started at the company, wiping out a couple of years worth of savings. (Yes, some loved ones did raise an eyebrow, but it was a safe investment, as safe as any such investment can be)
I didn't feel wealthy at Google's IPO. I did write a check to pay off my mom's mortgage, which was a rather smart move I was making the monthly payments anyway, and the mortgage was at 8% or so and refinancing was impossible since nobody wanted to refinance for so little money.
I didn't even feel wealthy when I started shopping for a custom frame. For someone who rides much more than he drives, even a new custom bike every year doesn't come close to the cost of a car.
But a few weeks ago Lisa and I decided to engage a cleaning service --- we were just overwhelmed by all the housework that we had to do that we just didn't enjoy doing. We weren't good at it, and we weren't good about it. And I looked at my assets and thought: "Ok, let's find out how much a cleaning service is, and throw money at the problem to make it go away." We asked the concierge at work for a recommendation, called him up, and he showed up to give us a quote last week, and they came by today and cleaned up the house.
Lisa's reaction at the results when she came home was one of amazement. She got on the phone with the housecleaning service and raved at the owner with praise for a good 20 minutes. I was pretty impressed. It felt like coming to a B&B, everything all laid out, the sinks polished, etc. So for the first time in our lives, at least, we felt wealthy.
The thing is, we live in a small Silicon Valley apartment. The quote for the service was embarrassingly small. We could have afforded it ages ago, but it always felt like a luxury, and indeed it is one. This little luxury, more than any object we've ever purchased, wasn't just an object, it was time away from doing things we didn't enjoy doing, yet done with amazing professionalism. So if you want to feel wealthy, treat yourself to a really good cleaning service.
Sunday, October 07, 2007
Review: The Other Boleyn Girl
This is a story of sibling rivalry and ambition, told through the lens of Mary Boleyn, the sister of the historical Anne Boleyn, the second wife of Henry VIII, and the first to be beheaded.
The story portrays Mary Boleyn as the heroine of the story, whom at the age of fourteen was the King's mistress. Unlike the historical Mary Boleyn, the fictional one is portrayed as the pawn of her family's ambition, to be bedded and wedded as the family needs and as the men design.
When Mary's sister Anne shows up in court, she demonstrates her ambition, first by seducing Henry Percy, getting exiled from court for her troubles, and then upon her return, upending her sister's claim on the King by displaying a shrewd manipulation of Henry VIII. The book portrays Mary Boleyn's maternal instincts as opposed to Anne Boleyn's intelligence, temper, and ability to manipulate others. It is quite obvious what values Phillipa Gregory (the author) holds dear.
The novel succeeds in manipulating us to feel that the downfall of Queen Anne was deserved and that the place of a woman is in the home and in bringing up children, not in working on her ambitions. Being a period piece, obviously I cannot fault Gregory for bringing in all the homophobia, the feeling of scandal when the King divorces his former Queen, etc., but I suspect those of us who live in the modern age will read it and be thankful that we were born quite a bit later.
The story portrays Mary Boleyn as the heroine of the story, whom at the age of fourteen was the King's mistress. Unlike the historical Mary Boleyn, the fictional one is portrayed as the pawn of her family's ambition, to be bedded and wedded as the family needs and as the men design.
When Mary's sister Anne shows up in court, she demonstrates her ambition, first by seducing Henry Percy, getting exiled from court for her troubles, and then upon her return, upending her sister's claim on the King by displaying a shrewd manipulation of Henry VIII. The book portrays Mary Boleyn's maternal instincts as opposed to Anne Boleyn's intelligence, temper, and ability to manipulate others. It is quite obvious what values Phillipa Gregory (the author) holds dear.
The novel succeeds in manipulating us to feel that the downfall of Queen Anne was deserved and that the place of a woman is in the home and in bringing up children, not in working on her ambitions. Being a period piece, obviously I cannot fault Gregory for bringing in all the homophobia, the feeling of scandal when the King divorces his former Queen, etc., but I suspect those of us who live in the modern age will read it and be thankful that we were born quite a bit later.
Friday, October 05, 2007
Building a custom bike, Part III
This is the final revision. What happened was that my fork builder, Black Sheep Bikes gave Carl different dimensions than the actual fork itself, so when the fork itself showed up, Carl measured it and revised the drawing. Everything looks good (now the head tube is longer), and it's almost time for me to start buying parts for the new bike. Since the parts are mostly coming off the Fuji Team SL, I'll really only need a new stem and some spacers. (Carl's also selling me a silver Chris King headset to go along with the frame)
If this is a replacement for my touring bike, why am I putting the Fuji's parts on it? The theory is that this will really be my do-everything bike. The Fuji's parts are lighter, and I'm not looking at any major bike tours in the near future, so I might as well make this the light day riding bike first. For daily commuting, STIs work just fine, and I can swap in the seat post, wheels and lights from the Heron. On weekends, lighter wheels on the bike, the lights come off, and I put on the carbon seat post instead of the B-17. The entire transformation should take 10 minutes.
For touring, I'll swap in a triple chainring crank, a bottom bracket to go along with it, bar-end shifters (a whole new handlebar set, actually, with carbon brake levers, etc), and the bike will be ready to go! If I have to do this a lot I'll work out some cable splitters and find a way to switch between double and triple cranks easily (this can be accomplished with the external bearing integrated cranksets, but unfortunately a move like that will cost a lot!). Either that, or learn to live with a 27" gear, which might be feasible if the bike is light enough. I will have to run a light tour in February or March to figure that out.
Monday, October 01, 2007
Review: The Birth of Plenty
This is William Bernstein's book analyzing the development of economies in nations and regions, the pre-requisites, and the implications for modern economies. Why did the industrial revolution happen? What are the pre-requisites? Why do modern economies appear to have a flat 2% growth rate? Is this sustainable? What about the Bottom Billion?
Bernstein's thesis is that there are four requirements for a modern, industrial economy:
I think anyone would find it difficult to argue with the first 2 requirements of prosperity. The experiments with Communism have found that without property rights, human nature just does not have the intrinsic motivation to work to produce what others want. An examination of modern contributions to well being also demonstrates that without the scientific world view, it is difficult to come up with new theories or technologies that truly improve the human condition (when was the last invention to come out of a fundamentalist mindset?).
The last 2, however, seem to me to be natural consequence of the first two. Once you've set up a good incentive system, human ingenuity will come up with good capital markets and transportation system. I am not a historian, so I won't say much about part 2 of the book, but I found it to be good reading and an illustrations of the principles involved.
The last part of the book will be more controversial, and is part of the argument between William Easterly and Jeff Sachs about development and aid. If Bernstein's thesis is right, then not only is aid in the form of food and medical improvements not helpful for developing countries, but they are harmful. A nation caught in the Malthusian trap with an increasing population just increases the number of miserable people without improving prospects for growth. This is something very important to understand: without economic development, all you get when you improve mortality rates and health is a lot more miserable people. Instead, what Bernstein prescribes is first establishing the rule of law so that incentives for people are directed towards improving productivity rather than attempting to undermine the system or corrupting it by becoming rent-seekers (gate keepers, or government bureaucrats living off bribes). Only after the rule of law has been established, with independent judiciaries can more education (providing the modern mindset), more AID (money to prime the capital markets), or more infrastructure help.
This is an extraordinary claim, and of course would be difficult to prove, but Bernstein provides two examples, both dictatorships that imposed a rule of law first, and the resulting economic prosperity eventually led to the overthrowing of the dictators themselves. (Hint to future dictators: keep your people miserable --- happy and prosperous people apparently demand democracy!) Bernstein demonstrates with statistics that democracy is not a precondition for economic success, and its correlation with prosperity is because the latter causes the former. (So observing free elections isn't all that useful if what you want to do is to eliminate poverty) What this means is that any attempt for us to reform the Middle-East is doomed to failure. None of the four properties Bernstein proposes should exist before prosperity exist in the Arab countries, and there's no sign that we're successful at imposing them on Iraq. Lawrence Wright also noted that the country of Norway created more exports than all of the Arabic countries combined, so at least with this regards, Bernstein is right.
I think it would be interesting to see what happens if we actually tried to apply this model for helping the "bottom billion." It definitely runs against what everyone else I've read recently says (except William Easterly), and is great food for thought.
Finally, Bernstein explores happiness and economic development. It seems quite clear that economic development by itself does not make people happy. All the studies show that people compare themselves relative to others for happiness, so countries like the Scandanavian countries with a low Gini Coefficient are happier than possibly wealthier countries like the United States. (A visit to the relevant countries will demonstrate this to be true)
When Bernstein visited Google, I asked him this question (not addressed in the book): "There is an argument to be made that our prosperity for the last 200 years has been due to the abundant supply of fossil fuels, which when they run out will make an end to our prosperity. What do you think?" His response was that he believed that this prosperity is largely dependent on human ingenuity, and that while fossil fuels might have helped a lot, he thinks that once on this treadmill, we'll managed to make ourselves wealthier even without fossil fuels, albeit at a slower rate.
In any case, this book is thought provoking, intelligently written, and well worth your time, especially if your first reaction when you see an article about third world poverty is to reach for your checkbook. The possibility not frequently considered is that your financial assistance may not help, but would make the very people you are trying to help even more miserable. You might not agree with Bernstein's assessment, but at the very least you should consider his very cogent arguments. As one of my colleagues said, "It is extremely pleasant when somebody whose books are so intelligent comes across as even smarter in person." I agree.
Note: Bernstein's talk that he gave at Google is now up on youtube.
Bernstein's thesis is that there are four requirements for a modern, industrial economy:
- Property Rights (including intellectual property rights such as patents and copyrights)
- A Rational Worldview (access to the scientific method)
- A large and efficient capital market
- Communications and transportation infrastructure
I think anyone would find it difficult to argue with the first 2 requirements of prosperity. The experiments with Communism have found that without property rights, human nature just does not have the intrinsic motivation to work to produce what others want. An examination of modern contributions to well being also demonstrates that without the scientific world view, it is difficult to come up with new theories or technologies that truly improve the human condition (when was the last invention to come out of a fundamentalist mindset?).
The last 2, however, seem to me to be natural consequence of the first two. Once you've set up a good incentive system, human ingenuity will come up with good capital markets and transportation system. I am not a historian, so I won't say much about part 2 of the book, but I found it to be good reading and an illustrations of the principles involved.
The last part of the book will be more controversial, and is part of the argument between William Easterly and Jeff Sachs about development and aid. If Bernstein's thesis is right, then not only is aid in the form of food and medical improvements not helpful for developing countries, but they are harmful. A nation caught in the Malthusian trap with an increasing population just increases the number of miserable people without improving prospects for growth. This is something very important to understand: without economic development, all you get when you improve mortality rates and health is a lot more miserable people. Instead, what Bernstein prescribes is first establishing the rule of law so that incentives for people are directed towards improving productivity rather than attempting to undermine the system or corrupting it by becoming rent-seekers (gate keepers, or government bureaucrats living off bribes). Only after the rule of law has been established, with independent judiciaries can more education (providing the modern mindset), more AID (money to prime the capital markets), or more infrastructure help.
This is an extraordinary claim, and of course would be difficult to prove, but Bernstein provides two examples, both dictatorships that imposed a rule of law first, and the resulting economic prosperity eventually led to the overthrowing of the dictators themselves. (Hint to future dictators: keep your people miserable --- happy and prosperous people apparently demand democracy!) Bernstein demonstrates with statistics that democracy is not a precondition for economic success, and its correlation with prosperity is because the latter causes the former. (So observing free elections isn't all that useful if what you want to do is to eliminate poverty) What this means is that any attempt for us to reform the Middle-East is doomed to failure. None of the four properties Bernstein proposes should exist before prosperity exist in the Arab countries, and there's no sign that we're successful at imposing them on Iraq. Lawrence Wright also noted that the country of Norway created more exports than all of the Arabic countries combined, so at least with this regards, Bernstein is right.
I think it would be interesting to see what happens if we actually tried to apply this model for helping the "bottom billion." It definitely runs against what everyone else I've read recently says (except William Easterly), and is great food for thought.
Finally, Bernstein explores happiness and economic development. It seems quite clear that economic development by itself does not make people happy. All the studies show that people compare themselves relative to others for happiness, so countries like the Scandanavian countries with a low Gini Coefficient are happier than possibly wealthier countries like the United States. (A visit to the relevant countries will demonstrate this to be true)
When Bernstein visited Google, I asked him this question (not addressed in the book): "There is an argument to be made that our prosperity for the last 200 years has been due to the abundant supply of fossil fuels, which when they run out will make an end to our prosperity. What do you think?" His response was that he believed that this prosperity is largely dependent on human ingenuity, and that while fossil fuels might have helped a lot, he thinks that once on this treadmill, we'll managed to make ourselves wealthier even without fossil fuels, albeit at a slower rate.
In any case, this book is thought provoking, intelligently written, and well worth your time, especially if your first reaction when you see an article about third world poverty is to reach for your checkbook. The possibility not frequently considered is that your financial assistance may not help, but would make the very people you are trying to help even more miserable. You might not agree with Bernstein's assessment, but at the very least you should consider his very cogent arguments. As one of my colleagues said, "It is extremely pleasant when somebody whose books are so intelligent comes across as even smarter in person." I agree.
Note: Bernstein's talk that he gave at Google is now up on youtube.
Saturday, September 29, 2007
Fall Riding
Today, I had a hankering for a decently long ride. I went up Page Mill Road in the morning from Moody Road, and the weather was very nice. Near the top, I ran into someone riding up the hill with no shirt, flat pedals on an old Trek 1000 bike. He was incredibly strong, proving once again that equipment is no match for great legs and lungs. At the intersection with Page Mill road, I eschewed mixing with Wes's group, however, and headed up to the true summit on West Alpine road, where I pulled off and enjoyed a cliff bar with a view of the Ocean.
Descending Alpine road, I soon overtook the tail end of the group and road along the cold Redwood forest. It was gorgeous. Sunlight came through little spots in the trees and gave the road surface a dappled look. Leaves came down from the redwoods above me, and the air smelled like fall. Turning left onto Pescadero road, the wind picked up a bit and threw down more leaves, swirling around me and enveloping me in nature's glory. Wes passed me once again, and upon reaching the summit of Haskin's hill, turned right around and went back to pick up his group's stragglers. I rode on rather than mix in, since I enjoy descending by myself with no pressure behind me and no one in front to chase.
The solitude was broken several miles later as the lead group passed me and I hopped onto their wheels, as we pace-lined together towards the coast. The group turned off at North road while I kept going towards Pescadero and headed for Norm's market. There I bought a loaf of freshly baked (still warm) artichoke garlic bread, and went over to the benches at the back of the store just as Wes's group as they arrived from their detour. Not being able to eat the entire loaf by myself, I broke the bread and shared it with them, enjoying the unusually clear and lovely day on the coast.
After eating, relieving myself, and refilling my bottles, I left Wes's group behind and went on ahead. Soon enough, a cyclist on a GT bike passed me and I again hopped on his wheel. He was exceedingly strong but as we slowed down to chat I found out why --- he raced mountain bikes for GT, Oakley, and a few other sponsors. As stage road sloped up I was left behind on the climb but with such a nice day and the road being out of the wind once the climbing began, I did not mind at all riding by myself.
After the intersection with 84, I rode up next to a young lady on a Scott Contessa. We struck up a conversation: Stephanie was a mechanical engineer who worked on power-trains. We discussed training, traveling, and various events, and bone density --- she lifted weight so frequently that her bone density was off the charts --- clearly, I need to lift more too, though I am never motivated enough in the gym. She was recovering from a skiing injury, hence the riding.
Time passes fast when you have conversation on a ride, and soon enough we were at the top of Tunitas Creek. The descent down Kings was disconcerting, as I hit no less than 3 gravel patches on the way down. Both of us made it to Woodside with no problems, however, and from there we made it over to Sand Hill Road where Stephanie had parked. I said farewell to my recent companion and headed home the direct route, for a 76 mile ride in 6 hours.
Descending Alpine road, I soon overtook the tail end of the group and road along the cold Redwood forest. It was gorgeous. Sunlight came through little spots in the trees and gave the road surface a dappled look. Leaves came down from the redwoods above me, and the air smelled like fall. Turning left onto Pescadero road, the wind picked up a bit and threw down more leaves, swirling around me and enveloping me in nature's glory. Wes passed me once again, and upon reaching the summit of Haskin's hill, turned right around and went back to pick up his group's stragglers. I rode on rather than mix in, since I enjoy descending by myself with no pressure behind me and no one in front to chase.
The solitude was broken several miles later as the lead group passed me and I hopped onto their wheels, as we pace-lined together towards the coast. The group turned off at North road while I kept going towards Pescadero and headed for Norm's market. There I bought a loaf of freshly baked (still warm) artichoke garlic bread, and went over to the benches at the back of the store just as Wes's group as they arrived from their detour. Not being able to eat the entire loaf by myself, I broke the bread and shared it with them, enjoying the unusually clear and lovely day on the coast.
After eating, relieving myself, and refilling my bottles, I left Wes's group behind and went on ahead. Soon enough, a cyclist on a GT bike passed me and I again hopped on his wheel. He was exceedingly strong but as we slowed down to chat I found out why --- he raced mountain bikes for GT, Oakley, and a few other sponsors. As stage road sloped up I was left behind on the climb but with such a nice day and the road being out of the wind once the climbing began, I did not mind at all riding by myself.
After the intersection with 84, I rode up next to a young lady on a Scott Contessa. We struck up a conversation: Stephanie was a mechanical engineer who worked on power-trains. We discussed training, traveling, and various events, and bone density --- she lifted weight so frequently that her bone density was off the charts --- clearly, I need to lift more too, though I am never motivated enough in the gym. She was recovering from a skiing injury, hence the riding.
Time passes fast when you have conversation on a ride, and soon enough we were at the top of Tunitas Creek. The descent down Kings was disconcerting, as I hit no less than 3 gravel patches on the way down. Both of us made it to Woodside with no problems, however, and from there we made it over to Sand Hill Road where Stephanie had parked. I said farewell to my recent companion and headed home the direct route, for a 76 mile ride in 6 hours.
Friday, September 28, 2007
Review: The Looming Tower (Al-Qaeda and The Road to 9/11)
This book won the Pulitzer prize award last year, and covers the origins and creation of Al-Qaeda, the fumbling of the ball by America's intelligence and law enforcement agencies, and the people involved in it.
The first part of the book chronicles the rise of Islamic fundamentalism in Saudi Arabia and the life of Osama Bin Laden. This part of the book is extremely well researched, getting details like his initial forays into Afghanistan, his marriages, as well as certain other important characters in Al-Qaeda, such as Ayman Zawahiri, the Egyptian who joined forces with Bin Laden later.
It is amazing how good Bin Laden was at taking credit for things he didn't do, and creating a myth around himself. Lawrence Wright, when he visited Google, said that the Muslim countries have in general created a place that is difficult for young men to live without boredom: there is no music, no dating, no movies, hence the attraction of matyrdom and becoming a freedom fighter.
The second half of the book covers the CIA and the FBI's investigation of major cases, including the bombing of the USS Cole, the initial failed bombing of the World Trade Center, as well as the failed attempt at the Los Angeles airport. With the benefit of hindsight, you can't help but wince at every missed opportunity, that perhaps with a more competent administration, would have foiled the ultimate tragedy that followed.
There are several colorful characters here as well, including John O'Neill, the FBI operative who was obssessed with hunting Al-Qaeda, only to be foiled by diplomats, the CIA, and his own appetites (he had 3 girlfriends in different cities and a wife, and was juggling all of them, and lived life well beyond his means). Though it made for a great story, I wish Wright could have spent more time on other parts of this narrative.
All in all, a very deserving Pulitzer prize, and required reading for anyone who's life was touched by the tragedies 6 years ago. Ultimately, however, I suspect that the war against terrorism is a cultural war, not one that can be won by counter-terrorism, law enforcement, or military action. Whether we can win over entire cultures into enlightenment and liberalism (or in fact, even our own culture) will ultimately decide how history plays out in the Middle East.
The first part of the book chronicles the rise of Islamic fundamentalism in Saudi Arabia and the life of Osama Bin Laden. This part of the book is extremely well researched, getting details like his initial forays into Afghanistan, his marriages, as well as certain other important characters in Al-Qaeda, such as Ayman Zawahiri, the Egyptian who joined forces with Bin Laden later.
It is amazing how good Bin Laden was at taking credit for things he didn't do, and creating a myth around himself. Lawrence Wright, when he visited Google, said that the Muslim countries have in general created a place that is difficult for young men to live without boredom: there is no music, no dating, no movies, hence the attraction of matyrdom and becoming a freedom fighter.
The second half of the book covers the CIA and the FBI's investigation of major cases, including the bombing of the USS Cole, the initial failed bombing of the World Trade Center, as well as the failed attempt at the Los Angeles airport. With the benefit of hindsight, you can't help but wince at every missed opportunity, that perhaps with a more competent administration, would have foiled the ultimate tragedy that followed.
There are several colorful characters here as well, including John O'Neill, the FBI operative who was obssessed with hunting Al-Qaeda, only to be foiled by diplomats, the CIA, and his own appetites (he had 3 girlfriends in different cities and a wife, and was juggling all of them, and lived life well beyond his means). Though it made for a great story, I wish Wright could have spent more time on other parts of this narrative.
All in all, a very deserving Pulitzer prize, and required reading for anyone who's life was touched by the tragedies 6 years ago. Ultimately, however, I suspect that the war against terrorism is a cultural war, not one that can be won by counter-terrorism, law enforcement, or military action. Whether we can win over entire cultures into enlightenment and liberalism (or in fact, even our own culture) will ultimately decide how history plays out in the Middle East.
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