Trip Report: Rosenlaui

Rosenlaui

When I first accepted my Munich assignment, I sort of had this vision that I'd get a nice big apartment, and I'd have plenty of friends come to visit. To my surprise, all through the best travel season (June, July, etc), I had no visitors. Then this past week, Phil Sung, my former intern arrived for a visit. Apparently, when he asked me for suggestions 6 months ago, I mentioned Rosenlaui, and Phil was kind enough to get reservations for him and me. I've visited Rosenlaui 3 times now, on all previous tour of the Alps, but each time was for one night each, and being on a bicycle tour, we just rode through.

We decided to drive up, instead of taking the train. This theoretically would take us less time, and give us more flexibility, and cost less. In practice, with better planning we could have saved some time and money, but we would have had to give up a wonderful meal at the Lammi restaurant, and I guess that's worth a little bit of money.

The drive was interesting, and I got to ues my GPS' navigation function --- interestingly enough, this was the first time I compared it head to head against Google Maps, and found that the Garmin City Navigator NT was quite a bit better --- every time the two disagreed, Garmin's directions were much more likely to follow the "official designated route" as shown by the highway authorities.

We arrived at the Lammi Restaurant at 1:00pm, and had the wonderful home made brat-wurst with Noodles. This is the place that made all other sausages (yes, even many German sausages) a disappointment, and we thoroughly enjoyed the wonderful meal and ordered ice cream after wards to top it off. We then headed up Grosse Scheidegg, stopping at the Hotel Zwirgi to have a quick peek at the famous Reichenbach Falls. The road was narrow and winding and I remembered why I enjoyed climbing it so much on the bike --- it's too narrow for there to be a lot of traffic, and what traffic there was had to go slow because of the Post Bus (which has right of way), and the scenery.

We got to Rosenlaui around 3:00pm, and checked in with Christine. After putting in everything we brought with us into the tourist room, we decided to take advantage of the good weather and go for a hike. We initially started out down the Valley to Kalterbrunnen, where we picked up the trail to Hohbam. Once we got there, we discovered we had enough time to make the hike more extensive, and chose to go all the way to Engelthornehutte at 1901m. We got there around 6:00pm, and headed down the hill, along glaciers and beautiful rock gardens. The descent was a little challenging, and we wished we hadn't left the hiking sticks in the car. We got back to the Hotel at 7:30pm, just in time for the nightly 4 course dinner.

The next morning was gray and cloudy, and after a quick breakfast, we headed down the hill in a drizzle to see Lauterbrunnen. I was just there in July, but figured Phil should have a chance to see the touristy sights as well, since he was quite worn out from the day before. We saw the Staubbach Falls, the Trummelbach Falls, and walked around Stechelberg, but the rain kept coming down. We didn't manage to make the Lammi for lunch, but stopped in Meiringen to see the bottom of the Riechenbach Falls, and to learn that we would rather see the Gorge at Rosenlaui than the one in Meiringen.

So we went to that one, and enjoyed the gorge, with its underground swirls of water. We liked it so much we did it a second time, and it was just as impressive. Then it was back to the hotel for hot showers to warm up and another glorious 4 course dinner.

Saturday morning looked foggy when I woke up, but when I ran into Andreas he told me to look outside, and sure enough, it was brilliantly clear! I showed Phil how to perform an exposure lock on his camera so we could capture some of the spirit of the moment, then quickly got ready and started out on an ambitious hike. We first headed up the trail on Grosse Scheidegg. I've done this bike ride many times but the hike is prettier --- lots more water exposure, and grand views of the glaciers and open space. At the top, I asked Phil what he would rather do, take the Post Bus to Grindelwald to catch the Jungfrau Bahn, or keep going on the hike. He chose the hike, and we paused at the summit to look at the amazing scenery right in front of us --- fresh snow had capped all the local summits (including the Eiger and the Jungfrau), and everything looked so clean and white it was blinding.

On the bike, I always just descended to Grindelwald, but I'd always wondered where the hiking trail went. It looked like it went quite a bit higher, and I turned out to be right. It headed up to 2000m, where you could split and head over to First (2200m), or back down to Rosenlaui Valley. The Rosenlaui Map indicated that the route might be a little challenging, so I offered to Phil my opinion that it was better to delay First for a future visit and just do the Hornseeli Trail.

Sure enough, the trail started heading upwards after a short descent, and the going got steep. Right after a corner, we saw that not only did it get steep, it got muddy. I should have switched back to hiking boots then, but I stubbornly thought that it would get better at the lake. Well, the lake was pretty, but had too many cows visiting it recently, so there I finally gave in and put on hiking boots to stomp through the mud and water. Phil, unfortunately was not as well equip, and after a while gave up and switched to sandals.

The scenery was gorgeous. To one side, fall after fall could be seen. To another, streams cascaded down right into the trail. Ahead of us was beautiful farmland where a river ran through it. All this was framed by gleaming white peaks, with strands of clouds and fog hanging in the air, lending our mountains an air of mystery. I could have cried, for it was all so precious.

At the bottom of the hill, Phil took some time to wash his feet, and I switched back to running shoes and fresh socks. We looked around and were amazed at the landscape before us. Unfortunately, at this point, Phil's camera battery chose to give up the ghost --- heart stricken by all the physical beauty before us, no doubt. Well, we kept going down the Romantik Weg (Romantic Way). At this point, we had choices between longer routes or shorter routes, but Phil's knee was starting to hurt so we picked the easy route to Schwarzalp, stopped there for ice cream and to buy some alpine cheese, and then headed back to Rosenlaui, where hot showers and another fabulous meal awaited us.

Sunday wasn't as pretty --- the snows were almost all gone, and it started to drizzle an hour into a 2 hour walk we had saved for ourselves. So we bundled ourselves reluctantly into the car, and headed back to Munich, vowing that we would find a way to come back to this hauntingly beautiful place.

Take note: Rosenlaui has no TV, no internet access, no cell phone coverage, and no running water in its rooms. Our room had no electrical outlet but Christine told us it was an anamoly. Don't go there expecting a modern resort. Do expect a fabulous fixed menu dinner for an amazing price, and excellent hiking. Next time I do a bike tour there, I'll be staying for more than one night --- it's too nice not to!

Rosenlaui comes highly recommended. You won't find it in most of the guidebooks about the area, and you will need reservations if you're going to be there during the weekend. By its very nature, it will not draw too many tourists, but if you're the adventurous type, go there for a week. You won't regret it.

P.S. Phil found some photo stitching software and applied that wizardry to one of the pictures:

Another Rosenlaui Picture

 

Couldn't resist. Look at it and be jealous.

Back from Rosenlaui

 

Just got back from Rosenlaui. It was gorgeous. Full trip report to come later.

The True Cost of Cheap Parts

I was recently in a debate on a mailing list about using cheap standard hubs versus low-maintenance hubs like the Phil Wood. Most people take into consideration only the up front costs, and the pain that ensues, rather than the total cost of ownership. Here are two models for modeling that:

The resale model:
In 1993, I bought a pair of Phil Woods for $120. 13 years later, I sold the pair for $110. The expensive hubs cost $10 over 13 years. No matter how cheap the Deore LX hubs are, you can't beat the resale value of the expensive hubs.

The TCO model:
A typical hub overhaul costs about 30 minutes per hub. Let's say it costs you $15 per overhaul (valuing your time at about $30 an hour at half an hour per overhaul, and ignoring the cost of grease, cleaner and ball bearings). Let's say an overhaul happens every 5000 miles. I can get Phil Wood hubs for about $450 a pair. Since we're talking about a pair of hubs here, that's $30 every 5000 miles. At that rate, it'll take 75000 miles before the Phil Woods are cheaper from a Total Cost of Ownership perspective. Every mile after that, the Phils are saving you money. Over a total life time of around 300,000 miles (which is what Jobst reports for his ball bearing hubs), the Phils will save you about $1350 in maintenance costs. And then don't forget to add in the money you spent buying the special cone wrenches, and the additional time you need to preload the bearings, and the Phil wins even more.

Most people who make enough money to have multiple bikes or to be able to buy a nice bike value their time more than $15 an hour (and most people do have to pay something for ball bearings --- the cheapest place I found on ebay sold DuraAce/Record quality ball bearings for about $10/100, grease, and cleaners), so do the math for yourself as to whether using cheap hubs actually save you money.

Over and over again, I've learnt over the years that cheaping out on outdoor equipment is just not worth it. In the long run, you'll pay more for the cheap stuff than for the expensive goodies that come with lifetime warranties.

The Security Boondoggle

I've been having to think about security at work recently (never something good for my mood), and despite rarely wanting to blog about Computer Science, I ran into something too funny and endemic of typical security issues that I'll break the rule this time.

First, I read the MIT presentation about subway hacking, which is in itself hilarious funny and very much worth a read. Go ahead and read it and then come back --- the rest of this post assumes that you have.

Well, I happen to know people who used to work on that kind of transportation security system, so I sent them e-mail to tease them about the security work. Here's a response (names and details redacted):
[they hired] a security guy who guards all the encryption code zealously. I mean.. he was quite the nazi and because of his position, he let's people know it. Everyone who wanted to work on the encryption code for XXX subways had to go through him.

One day, the worse programmer I ever know (although he claimed he invented the keyboard) was assigned to debug an issue on the fare cards and encryption god was out of town. Well, he basically reversed engineered the encryption code by manually trying everything until it worked. Took him a week but he did it. That scared the shit out of XXX because he was quite possibly a sanitation engineer who pretended to type on the keyboard.

Anyway, these MIT kids need to take a lesson from some of those tricksters in XXX. The most creative ones know exactly where to crease a magnetic stripe so that the fare card will give unlimited rides. This is without the benefit of any technology. Another one would manually tape several cards over each other to create a super ride card. Of course, there are the ones that just brings a gun and a bat and just shoot the machine until they can get in. Those ones are much less creative.

That description of the security Nazi unfortunately matches my experiences with computer systems in general --- when systems designers think about security, they immediately think of complex crypto system, encrypting everything everywhere, and in general making life difficult for the legitimate user. In reality, most security attacks work on the weakest link --- the social engineering approach, or the physical system. So your most valuable security people isn't the guy with the PhD in cryptography, but your UI designers and engineers. If you make a system so painful to use because of security, then users will actively find a way to defeat it. (For instance, if I buy a computer game, I usually end up finding a pirated version anyway and installing it because the user experience is better!)

A few years ago, Eric Rescorla gave a talk at Google entitled The Internet is Already Too Secure. It was a great talk, and it makes the very important point that it's too easy to get academic respectability for designing and implementing complex crypto systems for security. What's really hard is designing easy to use systems that users will adopt and achieve widespread adoption and success (like ssh), with good-enough security that the rest of the system is the weakest link. But whenever I talk to security experts that's never what I hear. It's always about making life hard for the legitimate user!

Consider this story about two payment systems: one system was much cheaper than the other, but required additional input from the user to verify security. The other system was much more expensive, but required no work from the user to use, and hence was much less secure. Both systems were widely available at all point of sales. The higher security system had next to no fraud. But the lower security, more expensive system was much more popular. The maker of the lower security system made so much more money than the other system that it more than paid for reimbursing merchants for fraudulent use. In case you haven't figured it out, the lower security system is the Visa/Mastercard payment system, and the higher security system is the pin-required debit card system. Convenience, and making things easy for the legitimate user should trump all security concerns --- if that's not in your design goal, you've already screwed up big time and it doesn't matter how much security you put in --- commercial success will be out of your reach, so you'll never have any security problems to worry about.

And for those who are wondering, the Munich MVV system uses the least secure method of all --- the honor system. Until you get caught a few times, it's actually cheaper not to navigate the difficult-to-use ticket system. In the time I've been in Munich, I've only been checked once (yes, I had a ticket when I was checked) --- but the system still works (when the ticket inspectors came through, not one person on my incredibly crowded train was a cheater). My guess is, going with a more complex security model would have cost the MVV money, rather than save them any. In that sense, more security is just a tax on legitimate user, rather than helping anyone at all.

Walchensee Loop

Walchensee Loop

After rather successfully killing myself last week, I decided to take it a bit easier this week, so when Radina told me that she was going to head out from Wolfrathausen to Walchensee, I agred to join her. The morning was cool, so I started with arm warmers and knee warmers. It also helped that we started out on the Isar Radweg, which while mostly unpaved, was also very well shaded (so much so that the trail was still muddy from yesterday's rains --- yuck!).

Soon, the trail gave us two choices, an 16km ride to Bad Tolz, or a 10km ride to Bad Tolz. Well, mama didn't raise no dummy, so I chose the 10km ride, which turned out to make the distance shorter by climbing a hill. That was fine by me, though on dirt, the climb was a bit difficult --- I had mounted 700x28mm tires the day before, however, so I was quite pleased that I had done so.

The day shaped up to be pretty warm, and by the top of the hill, I decided to shed my leg and arm warmers and put on sun screen. The short descent down the hill wasn't very fun, but a few rollers later, we were dumped out onto smooth asphalt and a fantastic descent. A few jiggles of the road, and we were finally on the bike path into Bad Tolz. I had previously only ridden into Bad Tolz from the South, and coming from the North was quite different --- you hit a lake to your left and a river, and the view of Bad Tolz from the bike path is quite impressive.

We then followed the Isar bike path again, something I had never done before. Somewhere in the vicinity of Lengries, however, the bike path crosses the river, and not wanting to do so, we stayed on the West side of the river and got onto the road. From here, it was a straight shot up the Jachen river into the Walchensee. I had first ridden this road from the opposite direction in April, and at that time there was a strong wind headed this way, making the descent not much fun. The climb was so gentle that I hardly felt it at all, and certainly didn't think much of it until we got close to the Walchensee.

At the Walchensee, I spotted the bike path which I didn't realize existed the last time I had been there. Well, Radina wanted some pictures, and this was a good place for lunch anyway, so we rode down to the closest beach, ate lunch, took pictures, and then got going again. The bike path was unpaved, of course, but crowded nonetheless. At one point the bike path goes up the hill while the walking path goes along the lake. That reduced the traffic some but as soon as the climb was over and the road became paved again the place became crowded.

Wind-surfers dotted the lake like bees around a field of flowers. Sunbathers, swimmers, and rubber rafts paid court to the rocky beaches. It hadn't been nearly as crowded the last time I rode here, so summer must have arrived! After a bit of contemplation we immediately rode to the end of the road and turned right. I remembered this road from our hike a month back. The traffic was annoying as I remembered but no buses passed us. The climb, fortunately was short and not steep at all, and the descent down into Kochel was fun!

When the road flattened out, however, the traffic was not so fun. I proposed following a route I had planned, but Radinaa took a look at the climb I was proposing and would have none of it. So we tooled around along the flatlands, taking the direct route back to Wolfrathausen, where we had ice cream before getting onto the train.

Not bad for 820m, and a thoroughly nice day.

Review: Steel Beach

Reporter Hildy Johnson has a problem: He keeps trying to kill himself. Each time he does, so, however, he is rescued by Luna City's central computer, in complete violation of his civil rights.

When I first read this book in 1994, I thought it was a great novel --- it covered all the interesting parts of science fiction --- a world in which humans had been evicted from the planet by an alien species to save the whales, a world in which humans change gender just as easily as they can change clothes, and a world where the central computer (CC) is so integral to humanity's day to day life that it was impossible to do without it.

Unfortunately, this is one of those books that don't seem to hold up to repeated reading. The libertarian creed that seems to be continuously tossed at you is really annoying, and the much of the plot is pointless --- with human life being effectively immortal, Varley seems to think we would spend our time gossiping about celebrities, getting drunk, or engage in historic re-enactments. (OK, perhaps as a D&D player I shouldn't laugh at the latter)

The plot is rambling, and the narrator is narcissistic and shallow. The world is nicely realized at first glance, but on second read through one realizes that the technology is never described, is highly implausible, and the null-suit, for instance is definitely a deus ex machina, an instance where the writer basically wrote himself into a corner and set it all up so his heroine can survive long enough to tell the story.

All the while reading this story, I tried to remember what about it that I loved so much. I think the big one is when the narrator changes gender as casually as he changed a wardrobe. It's an interesting point of divergence from other science fiction, and it was great to see Varley put subtle changes into the character's narrative to the point where you forget that the character used to be male and start thinking of her as she. I'm afraid, however, that just one writing trick does not make an entire novel worthy.

I didn't feel like I wasted time reading this book, so it comes recommended. I'm just disappointed because I expected to come back to this book enthusiastic and raving about it but ended up not liking it as much as I remembered.

Holzkirchen Loop Ride

It rained last night, and it rained this morning, but I saw what I thought was a patch of clearing around noon and decided that what the heck, I'd paid for an IsarCard this month, I might as well get my money's worth. I caught the 12:44 train to Solln, and there switched to the fast train to Holzkirchen, getting there in 20 minutes. During the train switch, however, I got caught in a heavy down pour, and started wondering whether I had made the right decision.

By the time I got to Holzkirchen, the weather didn't look nicer, with ominous clouds in the sky, but at least it wasn't raining --- as I rolled out of Holzkirchen, I felt a few drops here and there, but nothing serious. The roads were wet though! I'd picked out what I thought was an interesting loop this time, and sure enough, it was interesting --- in 35 miles I'd climbed about 2500', which is quite reasonable for the area.

The climbing wasn't a big deal, though --- it was the headwind. A strong South West wind blew, so I was getting either a headwind from the South, or a headwind from the East the entire ride. The ride was pretty, but I couldn't see much --- hopefully, tomorrow's ride will yield nice pictures of the alps.

Review: The Munich/Paris Night Train

There's nothing so romantic as the idea of a night train. Get onto one of the night trains at 9:00pm in Munich at night, wake up in Paris the next morning at 6:00am. Coming back from Paris to Munich, it's 11pm to 9am. The cost is about 75 Euros each way per person, which compares unfavorably with the 93 Euros round trip on the plane. One would think that given the cost of fuel, and the carbon footprint of the train versus the plane, the train should be cheaper, but while Airlines in Europe are largely deregulated now, trains are still National Monopolies, and so are still priced that way. Naturally, if you're only on it one way, it's cheaper to take the train, and there are student specials that can get the price down to about 50 Euros each way if you're a student, etc.

Each cabin in second class has 6 bunks, dormitory style, stacked on top of one another. There's barely any room for luggage --- there's a rail on the top, and there's room below. I'm 5' 10", and the beds are just about an inch too short when I stretch out. Fortunately, I sleep in a fetal position anyway, so the roominess is not an issue.

Bring ear plugs --- not only is the train not as quiet as the regular trains, the chances are that you're sharing with 5 other folks on the train, and if any of them are men (or if you're unlucky and end up in a compartment with me), then one of them will snore. Lisa didn't sleep well at all on our trip. I, on the other hand, slept very well and didn't have any issues at all.

The cabin is tight and crowded, so other than reading and sleeping, don't expect to get much done. There does seem to be an unusual number of beautiful young ladies on our trip from Paris back to Munich, so perhaps if you're a single guy there's appeal there.

All in all, the experience isn't particularly romantic, so if I were to be asked to recommend a way to get from Munich to Paris or vice-versa, I'd tell folks to fly. Oh yes, and you have to book in advance. Don't expect the prices I quoted to be available if you're booking last minute.

Commuting

I had the fortune of riding with Grant Petersen back in 1993, after an introduction by Eric House, whom Rivendell sponsored. We met him for one of his commute rides, and I was jealous. He got to ride Pinehurst road, a beauty, take a zig zag through the regional parks near Berkeley, and then emerge into San Leandro for a 20 mile ride, of which 10 miles was off road.

I now have a commute to be jealous of, with even more terrain variety. On my commute I have about 5km of dirt, 30m of cobbles, 3 bridge crossings, 1 long tunnel, and 2km (if that) of city riding. Most of it is along the Isar river, so there are no traffic lights, or any traffic whatsoever. There's even a major descent and climb (of about 50-100m or so), of reasonable steepness to keep me in shape. In the evening on good weather days, the bike path fills with people --- picnics along the river, informal parties, or people just out riding, enjoying the weather. Once in a while, I even get the sound of a clanking clunker being pedaled like a maniac by a strong German woman trying to get somewhere in a hurry, passing me at speed despite her bike's constant protests. It is very funny to watch, and always puts a big grin on my face. You can't make this stuff up!

There is a penalty for this --- my first 2 weeks, I had 4 flat tires. To show that it wasn't just because I run thinner tires than most Germans would, there was one day when 3 mountain bikers and I were by the side of the bike path fixing flats. One even had to beg a couple of patches from me. It turns out that a favored past-time of Germans is sitting under the overhead crossings on the bike paths at night, drinking beer from beer bottles, and then smashing the bottles onto the bike path. One bridge, the Thaikirche bridge, is particularly bad in this regard, and I've learned to either bypass it, or to stop, and carry my bike 10 meters before riding it again (it's faster than fixing a flat tire) --- it's good for cycle-cross training.

But all in all, I'm happy with this commute --- even in the rain, there's not a day when riding next to the river doesn't make me feel like I'm touring, rather than commuting to work. I could take the train to work if it rains, but these memories are going to stay with me long after I leave Munich. Cycling is such an essential part of life here (even the intern at the office who hates cycling cycles to work), I don't know how Americans who live here without participating in the sport can consider that they've experienced the culture.

Is housing a good investment?

I was recently on an email thread where people were talking about housing as an investment.  In response to an assertion that housing has historically returned less than the S&P 500, someone asked, "Are you counting the rent that you aren't paying?"  My answer:

Yes.

House prices nationwide (sorry for the US-bias, but I don't have data for international markets) have very poor inflation-adjusted returns. Shiller (of the Case-Shiller house price indices) showed that house prices appreciated by 0.4% a year after inflation, from 1870-2004.

http://en.wikipedia.org/wiki/United_States_housing_bubble

If you buy a house, you don't pay rent.  But instead, you either pay for your mortgage interest, or you lose out on the return you could have had if your house were invested in stocks.  Assume that you're paying your mortgage interest.  At a 6% mortgage rate, you're paying .5% of your house price a month in mortgage.  People don't call it rent, but that's exactly what you're doing -- renting money to "own" the house so that you can live in it.  Even at the highest tax brackets and the mortgage deduction (call it ~40%) that's still .3% of the house price a month in mortgage costs.  Historically, house prices and rents have moved together (and there's good reason for them to -- if house prices rise relative to rents, people will choose to rent, driving up rents and driving down house prices).  That ratio (house price to yearly rent) has been about 21 or so.  When that ratio goes higher, houses are expensive and renting is cheap.  When it goes lower, renting is expensive.

http://www.frbsf.org/news/speeches/2008/charts.pdf, page 20.

So if your house is $X, and you're paying .3% (after taxes) a month in mortgage "rent", that's .036X a year in mortgage "rent".  The inverse of that, 27.8, is the price to rent ratio.  But remember that that simple calculation ignores costs of ownership -- property taxes (add 1% of X yearly), maintenance (another 1% ish), and so forth.  You get to the point where the cost of home ownership is very similar to the cost of renting.  Add .6% for property taxes (after the tax deduction), 1% for maintenance (no tax deduction there!), and you're paying .052X a year to own the house.  That's a price to rent of about 19.2.  With an historical ratio of about 21, you could have rented an equivalent apartment (or house) for less money.  Suddenly renting looks like the better deal.  The point here is that owning a home, by way of a mortgage, is expensive.

Choose instead to pay cash for the house so there is no mortgage.  (We can all dream.)  Now, instead you're losing out on the possibility of investing that money.  If your house is $X, you lose out on the risk-free rate times X.  Right now, that's the t-bill rate of about 1.52%, or almost 1% after taxes (no state taxes on treasuries).  (I note here for completeness that this is an historically low rate.)  You still have to pay property taxes and maintenance (1.6% after taxes).  Now, you're paying .026X a year to own the house, for a price to rent of about 38.  Wow, ownership looks great!

Of course, you could have taken that money and invested it in something slightly riskier, like a diversified stock+bond portfolio, making something like 7% a year.  (And that's certainly a more liquid asset than a house!)  There will be up and down years, but say long-term you can make 7% a year.  You have to pay taxes, so let's generously (from a "woohoo housing" perspective) assume it's all taxed as income at your marginal tax rate.  That's 4.2% after taxes.  Add in property taxes and maintenance, that's 5.8% after taxes.  Ouch.  Price to rent is just 17.2.

We haven't even considered the transaction costs of home ownership.  For starters, you pay 6% to a realtor just to move, which you have to remember to subtract from your returns.  There's the cost of applying for the mortgage, ...

In short, home ownership isn't a good deal.  There are certainly regions of the US where it *has* been a good deal in the past.  However, the main reason people make money on home ownership is because of their leveraged investment by way of a mortgage.  If you want leverage, start stocking up on S&P 500 futures or something.

If you want a nice place to live in, buy a home.  :)

Breaking News: Vanguard Total International Stock Index Fund just became more tax efficient

One of the reasons why folks like Bernstein recommend holding the components of the Total International Index Fund rather than the fund itself is that the Total International Index Fund is not tax efficient.

Well, that just changed! The fund is now going to carry half its portfolio directly in stocks, rather than as just the components of the other funds. This releases 50% of the foreign tax credit, which should help considerably with tax efficiency. How much does it help? My guess is that the 50% of the portfolio that's going directly to stocks is the largest 50% by market cap, and those tend to be the high dividend ones. But I'm not as familiar as international situations, so I don't know how that will go.

In any case, this is very good news, and reduces my desire to switch to the FTSE-all world Index, for instance, quite considerably.

Review: Tarzan of the Apes

One of the big attractions of the Kindle is the ability to load it up with old goodies for free or a nominal price. An early one was Tarzan (Kindle Edition)

Perhaps the sad thing about reading old books is that you'll never approach the innocence you had when you first read them as a child. For instance, as a child, I never noticed how much a product of his times Edgar Rice Burroughs was. He was racist, convinced of the superiority of the white race in every way. He was sexist, with the women in the stories only concerned about marriage, and constantly either saying that they were glad to have a man around or being told not to worry their pretty heads.

But the main character, of course, is Tarzan, and Tarzan is every bit as much of a super-hero as Batman or Superman is --- intelligent, strong, mobile, and possessed of incredible strength of character (despite his upbringing), Burroughs infused him with every bit of idealism he could find. In many ways, this original Tarzan is primal, skilled, and shy in a way that later renditions never managed.

All in all, I enjoyed the read, but fear reading the sequels, since the overt racism and sexism is quite a bit off-putting. Nevertheless, this is the original Tarzan!

Erding Radmarathon (not quite a century)

I woke up at 5, ate a piece of bread, and hurried out to the S-Bahn to catch the 5:24 train to Erding. This would be my first almost-century in Germany, so I didn't know what to expect from a German century. The first thing was that it's cheap: 8 Euros for the 154km ride. The second thing was that there's no SAG support --- unlike American centuries, the concept of having cars drive the route to help you in case you're in trouble would drive the cost up and be too environmentally unfriendly for a bike ride. Third, Californian centuries put chalk marks on the road to indicate the route, but here in Germany with narrow roads and frequent rains, the chalk would be washed away too quickly. Instead, the markers are arrows placed at intersection at about eye level. Overall, the placement was good --- there was only one marker I saw that was partially behind a bush.

The weather was warm, so much so that at 7:00am, before the start, I put on sunscreen and had taken off my leg warmers and arm warmers and put them in my saddlebag. When I first saw the route it seemed a bit flat, and indeed, I never had to put the bike into the granny the entire ride. However, it was very windy, so much so that when a paceline passed me, I hopped on it to get a bit of shelter. The paceline was going at 45kph, however, so after about 10 km I was forced to drop back. Fortunately, we were but 10km from the first checkpoint. We were all given little cards at the start of the ride, and at the first checkpoint and I found out why at the first checkpoint --- you're supposed to get them stamped. At the first checkpoint, I found the usual cycling food --- bananas, power drink, cakes, bread, but no porta-porties. Instead, cyclists would cross the road to use the bushes. (I didn't see too many women cyclists, so I don't know what they did)

The first checkpoint was at 45km, and it wasn't even 8:15 when I arrived. When I left, 5 minutes later a pack of riders passed me at what I thought was an acceptable speed, so I asked permission to join them and got an "of course." The group soon broke up and I found myself riding with a husband and wife team. The man worked for a pharmaceutical company, and was so strong that whenever we went up hills he wouldn't slow down at all, until his wife dropped back and he had to wait for her. At about 80km, however, I realized that I had made a mistake --- I was suddenly very tired, having burned all my matches for the day. I let them go ahead, and fortunately, the next checkpoint was at 90km. I suffered a painful cramp on the way there, but a sip of power drink and eating all my endurolytes made the problem go away, and it didn't recur.

I took a little longer this time, stretching myself, and drinking lots of power drink. But the feeling of tiredness didn't go away, and so I kept going. I felt really slow now, going around 20kph. I tried to hop on to a few pacelines here and there, but couldn't stay on them for very long at all. The bucolic scenery that had looked so pretty earlier today started to bore me, and the skies had become cloudy. And the wind was a constant annoyance.

Fortunately, the last checkpoint was at 124km. This was the most German of the checkpoints, since it served beer! I rested here for about 15 minutes and then went on, hoping the last 30km wouldn't be too painful. I went up the hills slowly and coasted down them as quickly as I could, but unfortunately, most descents ended with a sharp turn or a road intersection, which gave me no run-out. During the last 10km, the wind had gotten so strong that to add insult to injury, I had to pedal down the hills as well.

I arrived at the start/finish at 2:15, making it the fastest century I had still completed to date, but with about half the climbing I usually do for centuries, and feeling much worse than I usually do at the end of one. Nevertheless, at 96 miles and 1610m, it gave me a baseline for how out of shape I am this year --- too much flat riding has definitely taken its toll on me.

Review: The Last Unicorn

After reading the short story Two Hearts in The Best of the Year 2006, I had to go back and read The Last Unicorn again.

The story, for those who don't know, is that the Unicorn discovers that she's the last of her kind, and wanders of in search of what has happened to the rest of her kind. In between, she meets a hapless magician Schmendrick, a cynical woman who'd given up her dreams to live with outlaws called Molly Grue, and faces the dreaded Red Bull, who'd chased away the others of her kind.

The story is funny, full of songs and poetry (though perhaps not as well written as that famous fantasy trilogy), and filled with anachronisms, jumbling up the world of today, the world of yesterday, and the world of fantasy. Yet Beagle's use of language is so astute, so well controlled that we believe every word and let it guide us to its logical conclusion --- for though the Unicorn does fulfill her quest, it is not without cost, and unlike many other fairy tales, everything does not work out in the end.

A lovely, short read. Highly recommended. Heck, if you've read it before but it had been a while ago, pick it up and read it again!

Cultural Differences III: Messages Society Sends

On the way back from our romantic road trip, we sat in a train car with another pair of cyclists. My Kindle battery had drained, and we were in the mood for conversation anyway.

The husband, Hans, was quite an entrepreneur (unusual for Germany), having started several companies, and despite recent retirement, still sat on the boards of several companies. We got to discussing companies, behavior, and I mentioned how difficult it seemed to be to get people to switch jobs.

With the air of a man who was used to making speeches, Hans smiled and said, "What is the value of a life in society? In American society, the value is very clear --- commercial success is how everything is measured. When you look at German society, the messages are more mixed. For instance, when you look at the young people who are at the heart of the environmental movement here in Germany --- they've effected massive changes in German society. Most of them did not gain commercial success by these endeavors, but they were nevertheless very successful in their own way. Here, your friends are mostly defined outside work, and you don't socialize mostly with co-workers, the way Americans and American companies do. When I ran a company, I made sure that new employees were required to spend time on overseas assignment, perhaps a year or two. Many of them grew to enjoy the autonomy you get from being away from the head office."

Obviously, it would be a mistake to say that Hans is representative of his country, any more than I am a representative of mine (it would be very difficult to say which country I would represent, anyway). Yet many of his observations ring true to me. By and large, American society places a high value on individual success, and especially commercial success. While you do get the Ralph Nader or Julia Butterfly Hill, it is not clear that large enough groups of people are motivated sufficiently to join them in effecting large scale changes in American society, the way the environmental movement has done in Germany. Perhaps American society is too fragmented for such cohesive movements to spread. Perhaps race plays too great a role (as Paul Krugman's latest book points out), retarding any progressive movement's success.

Of course, the flip side is also true --- there's no other country that has managed to replicate Silicon Valley, and people like me wouldn't get to make observations like these without the dynamism of the American economy. But perhaps the price of this dynamism is high, and from an individual point of view, income mobility in the US is lower than that of Scandinavian countries, and the same as that of class-conscious Britain.

I doubt if the coming elections will give us a good debate about what kind of society Americans would like to have --- and that's a pity.

The Spreadsheet Asset Allocation Tool

Every so often, someone asks me to help with their finances. Usually, it has to do with asset allocation. I'm not an expert, but one of the things I know how to do is to use a spreadsheet. I usually open up a spreadsheet, and then perform a copy/paste from Vanguard's home screen, then open a second worksheet in the same file, and use that to compute asset allocation, and to see how far off things are.

I recently switched from a PC-based spreadsheet to one based on Google docs and spreadsheets. There are two reasons for this: first is that I ended up with so many different versions of the spreadsheet that I couldn't keep them straight between all the computers and files floating around. It doesn't help that I decided not to bring my Infrant RAID file system with me when I came to Germany, so I can't retrace some of my thinking from before, easily.

The second reason is the GoogleFinance function. This handy little feature lets me use one spreadsheet (instead of creating one per asset allocation period, which was what I was doing), only update the number of shares I have, and then have the asset allocation spreadsheet automatically recalculate. That way, like the big boys, I can rebalance every day if I wanted to. (NOTE: doing so in a taxable account is a bad idea!)

Unlike other financial bloggers, I don't blog anonymously, so I'm not going to show everyone my spreadsheet. However, I have constructed a hypothetical spreadsheet around a simple $100k portfolio with a 75% equity/25% fixed income allocation. The only unfortunate thing about this sample is that you can't download it or copy it or do anything interesting with it, but it gives you an idea of what I go through every asset re-allocation period. There are a few interesting things about this asset allocation, even so:

1. The portfolio isn't as tax efficient as it could be. For the purposes of capturing the foreign tax credit, it is best to hold the components of the Total International Index Fund rather than the Total fund-of-funds itself. Note that for domestic funds, holding the Total Stock Market Index is the right thing to do tax-wise, since as companies grow or shrink you don't pay the transaction fees for them moving from one market segment size to the next. (Unlike Small/Medium/Large cap categories, stocks don't usually move between countries)
   
2. The only alternative type investments is the REIT. I personally use a more complex mix to gain more diversity. However, for a portfolio of this size, if you break things up too much you lose efficiency --- you don't reach the Admiral shares level as quickly as you otherwise might.
   
3. Adding a value tilt is as easy as adding an appropriate value fund and adjusting the numbers in the asset allocation worksheet. I consider this superior to holding each of the components separately because you reach the Admiral shares faster (get lower costs), and it's simpler to track. Note that Bernstein recommends holding the components, but he normally deals with such large sums of money that getting the lowest cost share class is a given. The rest of us just aren't that lucky.

Disclaimer: The example spreadsheets and asset allocation are meant for informational purposes only. They are not meant as an endorsement of a particular fund, or to suggest that a particular asset allocation is the right one for you. Please do your own research before embarking on an investment program.

Review: Guardians of the Flame - Legacy

Legacy (DRM-free Kindle-compatible edition) covers 2 more novels in the series, about the next generation of "other-siders", most of which is Jason Cuilliane, son of the emperor and heir apparent. There's been a ton of fore-shadowing involving a sword in prior novels, but these two novels don't do anything related to that.

Instead, the first novel (The Heir Apparent) focuses on Jason panicking during a raid and running away. The rest of the party, of course, feels obliged to draw attention to themselves to that the Culliane heir doesn't get captured (this includes Karl abandoning the empire he built and turning it over to Barons). The net result is a series of big fights, and an conclusion that's perhaps no conclusion.

The second novel (The Warrior Lives) seems to me to be merely a wild goose chase. The only unexpected bit happens right at the end, but the pay-off is not worth the journey. Easy reading if you need a distraction, but I cannot really recommend it.

Chronicles of The Black Company (Books 1 - 3) Kindle Edition

This is going to be a different sort of review. It'll talk very little about the book itself, and a lot more about the Kindle edition of the book. Usually we don't do that sort of thing, but in this case, I feel that its quite warranted.

The Black Company is probably one of the most amazing fantasy series out there. It started with 3 books, and then later on expanded to 9. But not in a bad way (see Robert Jordan with his Eye of the World series). In fact, its so far away from Robert Jordan's style that a case can be made that these two series are diametrically opposed. Cook's writing style in The Black Company doesn't lend itself to long exposes of what his characters do with their hair, or skirts, or whatever, its pretty much just action, dialogue, and the bare minimum of descriptions to set the scenes.

And that's because there's a real story to tell. The Black Company tells the tale of a mercenary unit that is the very best at what it does, whether that is killing people, defending a city, or what not. Along the way, they get involved with high powered sorcerers and its a page turner to find out how they deal or don't deal with the various threats they encounter, along the twists and turns of the fortunes of the company. This isn't a high-fantasy novel in the sense that the only races in the world are humans, no elves, no dwarves, no halfings, but there IS magic, and magical monsters, though present, are uncommon. The powerful mages in the world are demi-gods and nigh-near unkillable.

The real meat of the story is that you do care for the fate of the company. The dialogue is witty, the characters seem real, and the adversaries are never as black or white as you'd like them to be. Its a fantasy novel for the mature audience, in short.

Now, onto the Kindle portion of the review.

The Kindle edition of this novel sucks, in a word. I've read many a kindle edition of books and this was the first one that I've found numerous typo's, type-set errors (where you see a word displayed twice in a row, or missing a word in the beginning of the chapter).

Having read the original paperback releases of the books, the beginning of each chapter that starts with a calligraphed word is accurate, but someone didn't do the conversion correct as the calligraphed word covers up part of that first word. So often you're left guessing what the word is. Its not hard, but it IS annoying. It becomes more of a problem in books 2 and 3 because Cook decided to make his chapters shorter, and so you get more missing words.

Still, for 9.99 and for what I think is one of the best fantasy series that exists, its still quite worth the money. If you haven't read the series yet, run and buy the dead tree version or the kindle version if you've got a kindle!

Salzkammergut Bike Route

Salburg Lakes

Radina's Photos

Ever since my last Salzburg Trip, I've wanted to explore more of the Salzburg Lakes area. There's not a lot of steep climbing there, so it's ideal for tandem cycling, so when the forecast gave me only a 30% chance of rain this weekend, I dragged Lisa out of bed and onto the train with the big bike on Saturday morning.

Joining us was Radina, a Bulgarian Physics graduate student finishing up at the University in Garching, near Munich. We met through Toy Town Germany, the web-site for English language speakers.

The train trip was uneventful, taking us into Salzburg's main train station right on schedule at 9:42am. The day started out beautiful, with high clouds but plenty of sun. We quickly found the Salzach river path out of Salzburg heading North. I had originally planned to take the same route I had taken before to get to the Seehamer See (minus a bit of climbing), but noted that the map I had indicated that the Salzkammer Bike Route started a bit further North from where I had departed the Salzach bike path. Radina had a high opinion of the bike routes, so we decided to explore.

Past the turn off I took, the bike path becomes dirt, and after about 15 minutes I saw a sign pointing off to the Salzkammergut trail. It was guarded by a gate with a ramp, however, so I took the time to ask some other cyclists in my halting German whether this was indeed the Salzkammergut trail. They told me yes, and that it was hard. Well, it couldn't possibly be tougher than the route I'd already found, so we gave it a go.

As dirt paths go, this part of the Salzkammergut trail wasn't bad, but fresh gravel had been laid all over the trail recently, which made it a bit sketchy here and there, even with the 700x32 tires I was running. The ramps were also a bit painful to negotiated on the tandem, but since we only had 2 of those to contend with, it wasn't too bad. We were rather grateful when pavement reappeared, however, since if it got steep, the dirt and gravel would make for tough going.

At the town of Anthering, the road started headed steeply uphill, not as steep as before, but since it was in the open instead of shaded, we all started sweating profusely. At one point, Radina had to stop because she had put sunscreen over her forehead, and the sweat washing that down into her eyes, must have been quite painful. It took less than 30 minutes, however, before we reached the hamlet of Modlham, and there the grade gave way to gentle rolling hills that were a joy to descend and climb. Radina was quite impressed that she had to pedal to keep up with us downhill since she had no trouble keeping up with us uphill.

Soon, we started a moderate descent into Obertrum am See, which was the lake I had visited before. We rolled along a bit on the familiar road, and when I saw the bakery in Seeham, we stopped, bought some lunch, and got permission to eat it at the swimming beach in town, which charged admission if you actually wanted to swim.

After lunch, we headed North again towards the Mattsee, and there in town, took a wrong turn and got off the bike route. Well, I stared at the map and couldn't quite figure out what was going on. Radina took the map and provided a second opinion --- that we needed to make a left somewhere before starting the descent. So we climbed back up to the top of the hill and there made a right turn before being reassured that we were on the bike route.

The signs were quite sparse, however, and soon we were lost again, heading into Neumarkt instead of heading directly to Strasswalchen. At this point, I started remembering that I had a GPS unit, and put it to good use. The detour to Neumarkt, however, got us to a supermarket that was opened all Saturday, so we bought a bunch of fruits, some drinks, stuffed it into our bags, and kept going.

In Strasswalchen, the bike route became well signed again, and we were taken past the Irsee, which was quite pretty, despite the overcast skies. We felt a few rain drops here and there, but it wasn't bad. Lisa started getting tired, and asked about lodging, so we stopped at every hotel along the way, but found that every place was booked. We were quite dismayed (especially when one of the places we checked had rooms but the man owning it told us he was too lazy to clean up the rooms enough to rent it) until about 1km from Mondsee, I spotted out of the corner of my eye a sign with beds pointing to the right, followed the driveway down to the end and found someone with rooms willing to rent it out for 25 Euros per person. With the beautiful view of the mountains (though we could not see the Lake), we took the rooms, took showers, had a nap, and then went to a local restaurant for a surprisingly inexpensive but filling meal.

I woke up at 6am on Sunday, feeling very good and ready to go. We ate almost all the food we had bought the day before, and then left around 8am to head into the Mondsee. Of all the lakes on this trip, the Mondsee is my favorite. We rolled along the lake, taking in the gorgeous morning --- the road was wet from rain the night before, but the sky was clear, granting us glorious views of the low clouds hanging around the surrounding mountains. We rolled along the single track road, and literally flew along it --- it felt so good and fast that at the top of a rise, I said to Lisa, that was so good, let's go back and do that stretch again. And so we did! Of all the touring I've done in the last few years, I've never immediately repeated a stretch of road, but this stretch was gorgeous and worth repeating right away while the conditions were good.

At the little village of Au, we made the decision to ride to Unterach to see the Attersee. Once there, we cut through a campground and walked to the water's edge to see another beautiful lake in front of us. Then we backtracked and headed onto the South side of the Mondsee. I had noticed markings on the map for a tunnel, and was quite nervous about it, but it turned out that the bike route included routings around the tunnel! First, we wound around a slide protection gallery (granting us a far better view of the lake than a car driver would get), then we weaved between a road under rock overhangs and the lake before plunging into a bikes-only tunnel. I remember being impressed by Austrian bike paths before, but this must have cost an enormous amount of money, and to see it first hand still impressed me.

Too quickly, we left the beautiful Mondsee behind, and headed over to Wolfgangersee, which Radina had built up as being quite the jewel of the area. Well, with all the hype, there was no way it could live up to it, but as we descended down into St. Gilgen, the views simply took my breath away! It was still early, so we took the opportunity to have a quick snack, and then rode through the tourist trap that was St. Gilgen, but did not make it all the way to the Abersee. We decided at this point that we should ride back towards Salzburg, since Lisa had a plane to catch the next morning and Radina was also saddle-sore, it being her first multi-day tour.

Back in St. Gilgen, Lisa ordered an omelette, I had a soup. We then headed out towards Salzburg on the big climb out of the lakes area. The climb wasn't as strenous as yesterday's, but it was quite a bit longer, though the views behind us were pretty. Nevertheless, there was quite a bit of traffic and we were annoyed by it until the bike path showed up. Once on the bike path, we climbed for a bit before descending and seeing the Fuschlsee from a distance. At this point, it got so warm that I swore that I would have ice cream in Salzburg, no matter what. A bypass route took us away from the main road towards Salzburg, but to our surprise once we were within 10km of Salzburg it was just down hill all the way in town.

Once in town, the GPS unit came into play again and we found the train station soon enough (though not without finding the wrong one as Lisa confused my instructions for "Hauptbahnof" with "Bahnof"). There, we bought train tickets, ate ice cream (I had 2!), and then got onto the train back home.

I've heard people talk a lot about terrain perfect for tandems --- if there's a tour made for tandems, it is this one. The climbs aren't long, and aren't particularly steep, and the rollers are a delight --- there are many hills you can just stomp up on your middle chain-ring (or big one if you're in shape --- we're not), and lots of gorgeous rollers. But most of all, the facilities are impressive --- you don't need reservations, and the route is mostly well signed (do carry a map, though!). This is an excellent first tour for anyone (there are more lakes we hadn't explored yet), and highly recommended for beginning cycle tourists or tandemists. If you are out of shape or just nervous about touring, there are luggage services that will do baggage transfer for you, as well as make reservations, provide support, maps, etc. But why give up your freedom? Pack your panniers, fill up your bottles, and ride!