College Savings

If you're an immigrant like I am, the American college financial aid system looks completely bonkers. Those of us from Asia, which has a more or less egalitarian elementary, middle, and high school education system roll our eyes about the "need-based" financial aid system. Most of Asia runs on merit-based system, because none of the insanity about property-taxed based local schools exist there. The property-tax based school system in the U.S. ensures that the poor remain poor, without much opportunity to qualify for higher education.

That being what it is, if you're a relatively high earner in Silicon Valley, it means that you do have to consider financial planning an essential part of preparing your child for college. Schools like to brag that 50% of their students receive some form of financial aid, which means that the other 50% essentially pay for college out-of-pocket in one form of another. Colleges also frequently include student loans as part of their financial aid packages, and I don't know about you, but I consider loans not "aid", but rather indentured servitude.

The first rule of financial planning for college is to fund your retirement accounts first! This is important because parental assets that are sequestered away in IRAs and 401(k)s cannot be considered in the financial aid planning formulas. Neither are primary residences most of the time. So that means if you're lucky enough to live off a $10M IRA and live in a $5M mansion in Menlo Park, all you have to do is to minimize withdrawals during the years your children are in college and you'll be treated like a trailer-park parent living off social security for the purposes of financial aid. Note that if you were to somehow manage to sequester everything away into your retirement plans and still end up having to spend some money on your child's education from the IRA, IRA withdrawal for paying higher education expenses are not subject to the early withdrawal penalty, though any withdrawal would still be subject to income tax.

The next tax shelter is the 529 account or the ESA. Most Silicon Valley high earners won't qualify for the ESA, but the 529 is available to anyone. The problem with ESAs in any case is that there aren't many low cost options for investing in them. Vanguard, for instance, has discontinued their ESA line of products. My wife writes about some interesting properties of the 529 here. Not only are 529s considered parental assets and therefore aren't as disadvantageous for financial aid purposes as a UGMA/UTMA account in the case where you do qualify for some financial aid. The big feature of the 529 is the tax-free compounding of assets as well as the tax-free withdrawal of gains for the purposes of paying for college education. It's relatively flexible and worth considering.

The final consideration is the UGMA/UTMA custodial account. The advantage here is the the child's investments get taxed at the child's rate. The problem here is that if the child accumulates a lot of assets, that will reduce his or her eligibility for financial aid at a much faster rate than if the assets were accumulated in the parental IRA or 529 accounts. However, if you're confident that your child is not going to qualify for financial aid no matter, then this is a viable strategy for the tax reduction.

Ultimately, of course, none of this matters if your child doesn't want to go to college or ends up being so highly sought after by colleges that they all offer him or her a free ride. In which case you should still fund your retirement accounts first!

Why I no longer buy individual stocks

Every time I'm tempted to buy an individual stock, I have to remind myself that I shouldn't do so. Now, vast fortunes have been and are being made in individual stocks today, so it's not because you can't make money that way. Similarly, I've bought and sold individual stocks in the past, and even made money doing so, so it's not because I'm not capable of making money that way.

Here's the deal: the overall stock market is a representation of corporate earnings in the USA. Over time, that growth is very much predictable: you can pretty much count on a 3% annual real return. Back when inflation was 3%, that meant 6% a year. You might have heard about the average 10% growth per year, but I believe that's excessively optimistic, and a result of bad math. For instance, if your portfolio dropped by 50% one year and then grew by 30% for the next two years, your portfolio would end up around 84% of where it was at the start of year one. In other words, it takes much more growth to overcome a big down year than simply taking the arithmetic mean of the growth would imply. The entire market is quite capable of doing such big swings, as most of us who've lived through the 2001 and 2007 crashes know.

An individual stock is even more volatile. Yahoo! for instance gave us quite a ride over the last 10 years, and is right now regaining the peaks it achieved in 2005, during the proposed Microsoft buyout. Is this because new CEO Marissa Mayer is going to jazz up the earnings? No, not really. It turns out that Yahoo's Alibaba stake is what's causing Yahoo stock to go up. So taking a bet on Yahoo is like taking a bet in the pre-IPO Alibaba. And in case you do want to bet on Alibaba, you should know that Yahoo's stock has already been bid up because of this!

In any case, I have no idea where Yahoo is going to go, and neither do most folks. Since that's the case, I have no business owning the individual stock. It gets even worse when it comes to stocks that you think you know something about, because that's when it's very easy for you to get caught up with the story you want to build and ignore poor performance. For instance, many techies hate Microsoft, and would want it to fail. Yet there's an argument to be made the Microsoft could be the next Apple. Don't believe that slide deck? Neither do I. Then again, I didn't want to believe that Apple would be the next Apple, since my personal bias is that the world would be better off if Apple didn't exist. (I bought Apple at $9/share and sold it at $50/share after deciding I couldn't trust Steve Jobs)

There is one stock I exempt from this rule, which is Berkshire Hathaway, which I consider to be a mutual fund run by Warren Buffett. During the 2008 crash, I found myself buying in, because the economic environment was one that Warrren Buffett is known to do very well in. I was right. But even then, I have a lot of trouble figuring out what to do with holdings now. Buffett is now very old, and who knows if he will kick the bucket soon, at which point I'll take a loss. So even in this case, I have my doubts as to whether what I did was wise.

The big difference between investing and gambling, therefore, is having a long term plan in place, and sticking to it. That's why despite all these stories about stocks being about to crash 40-55% (which I can believe in), I'm still sticking to my asset allocation. As John Maynard Keynes writes:

I would say that it is from time to time the duty of the serious investor to accept the depreciation of his holdings with equanimity and without reproaching himself.

Now this quote isn't relevant because everyone will lose money at some point or another. It's also there to remind yourself that the discipline to stick to your asset allocation is important, and overrides any desire to outsmart the market or yourself. The problem comes if you don't have the discipline, which then behoves you to hire someone else to drive the car while you get drunk.

Book Launched: How to Interview a Financial Advisor

As of this morning, my latest book, How to Interview a Financial Advisor, is now available at the book's website as well as the Kindle store. The paperback isn't ready because we're revising the cover (thanks, Scarlet). Rest assured the paperback copies will ship in plenty of time for any holiday giving you have in mind.

The book has a launch price of $9.99 on the Kindle store or on my web-site. My past books have been larger, and appealed to a narrower audience than this one would, hence the lower price. My hope is that this would prove useful to more people than the usual people who read this blog. The paperback will price at $19.99.

2014 Book Reviews

Update: Books of the Year 2014 have been selected!

Non Fiction

• Unaccountable
• The Everything Store
• Do You Believe in Magic?
• The Emperor of All Maladies
• Ghost in the Wires
• The Rise of Superman
• Caffeinated
• Aggressive Tax Avoidance for Real Estate Investors
• How to Win Friends and Influence People
• If You Can
• A Troublesome Inheritance 
• The Great Inversion
• All Joy and No Fun
• Sailing A Serious Ocean
• A Fighting Chance
• Capital in the 21st Century
• The Flash Boys

Fiction

• Silent Echo
• The Things They Carried
• The Speed of the Dark
• Soy Sauce for Beginners
• NOS4A2 
• Circle of Sorcerers
• Super Powereds: Year 1
• Super Powereds: Year 2
• Tunnel Vision
• Locked In
• The Dark Defiles
• The Inquisitor's Apprentice
• The Magician's Land
• Life With A Fire Breathing Girlfriend

Comics

• Fables #17 and #18

Review: Silent Echo

Silent Echo is J. R. Rain's short mystery novel. The premise is intriguing: our protagonist/detective is retired in a hard way: he's dying from cancer. However, one of his friends comes by and asks him to investigate an old flame's disappearance, which he can't resist, so he comes back for one last case.

The problem with the novel is that Booker does a lot of moping and self-pitying. He's not a very likable person, and the moping doesn't move the plot any further. The other problem is that with the limited mobility and fragility of the Booker, the author can't do very much with him. As a result, the list of prospective murderers are small, and you pretty much know who did it when you realized you're halfway through the book and there's only a handful of characters that have been introduced.

The reveal, when it comes isn't much of one, and I think only die-hard fans of the author would like it. Don't waste your time otherwise.
Disclosure: I got this book free through Kindle First.

Books of the Year 2013

This was an unusually poor year for reading, with family crisis, and other things getting into the way. I only read 51 books this year, which falls just a bit short of a book a week, and none of them were graphic novels.

On the non-fiction side, the winner is clear: The Story of the Human Body is the best non-fiction book I've read all year. It's a rich story, well told, and nearly every page will teach you something new about the origins of humanity and how it came about. It's well worth the money. The biggest impact on my life, however, is Modernist Cuisine at Home. This book has thoroughly changed what I thought was possible at home as far as home cooking is concern, and it continues to change what we eat and how we eat on an almost daily basis. Honorable mentions go to Nate Silver's The Signal and The Noise, as well as The Sports Gene.

On the fiction side, this has been a less than stellar year. The Hydrogen Sonata, for instance, didn't turn out to be a great Culture novel. Ghost Spin was good was a great novel, however, and lived up to my expectations for it. Every Day has a great voice, and is a lot of fun to read, except that the ending sort of ruined it. Even Zen and the Art of Motorcycle Maintenance wasn't as good as I remembered it, though it's still a still at the amazing price of $2.99 on Amazon. Don't get me wrong. All of these books are worth reading, and I would recommend them to anyone, but compared to last year's Hugo Winners? This year's batch of novels just aren't up to snuff.

Nevertheless, if there's one novel that stands out, it's Ghost Spin. Don't read it straight off the bat, though. Read Spin State and Spin Control first. The evolution of the characters and the setup of the context is worth it, and Chris Moriarty is one of the most under-rated writers in the business.

Review: Whirlpool 1.9cu ft Over-The-Range Microwave

My wife was unhappy with a crack in the microwave door, so we decided to replace the microwave with a different model. I'd become increasingly unhappy with the LG products in our house, so we made a point to avoid LG this time. The big feature that drew me to the WHM32L19AS was the big fan: 400CFM!

400CFM is big enough that you can feel the difference when you turn it on. There's less grease on the ceiling from cooking, there's smoke all over the place, and the machine is quite powerful. Reheating food used to take much longer than it does now.

The big downside is the reliability of the machine is suspect. After less than 6 months, it's already been broken. And not a cheap easy broken-ness, but a magnetron breakage. I asked the repair man how much it would have cost to fix it, and the answer was around $300, which meant that it would have been cheaper to buy a new one than to fix it. I asked how long he expected the new magnetron to last, and the answer was: "I've seen them die as quickly as in 6 months to a year." He added that the over-the-range hood microwaves get all the grease that used to be on my ceiling, and that when he pulled our magnetron it was very greasy.

Great. Just great. Why not just seal the darn thing better? My LG lasted much longer and had no problems. Worse, both the installation and repair was incredibly poor service. I'm no longer buying any products from Lowe's.

Not recommended. Next time, I'm just going to get a separate hood and a combi-oven microwave instead.

Review: Dear Mr. Watterson

I watched Dear Mr. Watterson in the hopes of gaining some insight about Calvin and Hobbes, easily one of my favorite strips. Since Bill Watterson's pretty much a recluse, you're not going to see him in this movie. However, you do get to see a lot of other cartoonists, including Bill Amend (Foxtrot), Berkeley Breathed (Opus).

You do get to see the place where Watterson grew up, and if you have good memories of the strip, that's going to be very evocative. You do see some Calvin and Hobbes originals, but unfortunately, the choice of shallow depth of field means you don't actually get to see what the folks in the movie talk about, like the white-out in various panels, etc. The strips, when they are displayed, are shown in MTV-style. Rushed pans, and single focus which basically means you never actually do get to read a strip to remind you in case you haven't gotten every strip ever done memorized.

All in all,  the director squeezed a 90 minute picture out of a 30 minute picture. Avoid. Spend your money on the book collections instead.

4 Months of Modernist Cuisine

It's been a while since I last posted about Modernist Cuisine, which is still my go-to book for cooking at home. For me, at least, it's significantly transformed my food preferences as well as the amount of cooking I'd do at home. I've done Creme Brulee, 72-hour short ribs, pressure cooked chicken adobo, and used the pressure cooker and sous vide machine far more than I ever expected to. I've applied to pressure cooker to even some of my favorite recipes outside the book, such as beef rendang and Japanese curry, to good effect---the time it takes to make those dishes have been cut down dramatically and the food quality has improved.

As for the Sous Vide Supreme Demi, I found myself appreciating it more after borrowing a DorkFood setup from a friend of mine. First, it's useful to have a second sous vide machine because while you have a 72 hour short rib cooking for 3 days, you might want to cook other stuff. But second, the slow cooker variants are slow! With the Sous Vide Supreme Demi, I can dump water straight from the tap into the machine and expect the machine to come up to temperature within 30 minutes even if it was ice cold water. No such luck with the DorkFood. You could pour boiling water into the slow cooker and still have to wait for hours for the temperature to come up if you're making Creme Brulee because most of the energy goes into heating up the cold porcelain of the slow cooker! The time saved from using the purpose built device has already paid for itself. Not to mention that DorkFood is loud!

By far the best recipe is the 72 hour short ribs. Those are to die for. If you've not had them, you need to try them. They freeze well, so it's not unusual for me to cook $50 worth of short ribs to freeze them for later use. The most common use for the sous vide machine has to be for chicken. At 66C for 2 hours, you can cook up the best chicken most people have ever tasted at relatively short notice.

All in all, I've found myself using the oven less and the sous vide machine has become the second hardest working machine in my kitchen. (In case you're wondering, the hardest working machine is the rice cooker!) Recommended.

Review: Jabra Journey Bluetooth Car Speakerphone

I got used to the Scion's built-in Bluetooth integration with my phone, so I ended up buying a Jabra Journey Bluetooth Car Speakerphone. You expect these 3rd party after-market solutions to be much worse and kludgey than say a built-in OEM solution, but you'd be wrong. The Jabra outperforms the Scion's Bluetooth integration significantly.

The Scion, for instance, only pairs with one phone at a time. The Jabra will pair with two phones at once. That's really useful, since sometimes both of us get in the car at the same time, and the Scion would inevitably pair with the wrong phone while the Jabra never has that problem. (The passenger can always click the Bluetooth button on a call to call basis)

What's great about this unit is that I expected to have to constantly recharge it. It does turn out that the 45 day standby time is correct. We've had to recharge it a couple of times since we purchased the device, but it's never run out of juice. What's amazing is that the auto-on-off works. Just getting into the car and closing the door is enough to trigger the device to power on and connect to our phones.

Voice clarity is variable, and I suspect it has to do with the phones involved much more than the device. When the phone is streaming Google maps directions, for instance, we can always hear it loud and clear. But if the voice call is iffy or noisy, for instance, why would you expect the Bluetooth speakerphone to work better than the earpiece?

Since the Journey supports A2DP, streaming music or Google Maps directions works automatically and magically. It's very cool, and in this respect is way better than the Scion's integration, where you'd have to switch the audio channel manually to see it.

All in all, I've been very impressed by this piece of technology, and would highly recommend it.

Review: The School For Good And Evil

Sophie and Agatha live in the town of Galvadon, a story book town where once a year, the Schoolmaster kidnaps two children away to attend The School for Good and Evil. These children will then end up in fairy tales and be written about for posterity.

Sophie is blond, fair, and pretty, and seems (to herself) to be a shoo-in for the school for Good. Her friend Agatha, dresses in black, and lives next to the cemetery, but doesn't believe in either the school or the fairies, and has no desire to be kidnapped. When they end up being kidnapped and Agatha ends up at the school for Good and Sophie at the school for Evil, the plot revolves around Agatha trying to get both of them home and Sophie trying to swap places with Agatha while winning her prince.

The book plays up to all the story book cliches, where the school for Good has classes like "beautification", "talking to animals", etc., and the school for Evil teaches "Uglification" amongst others. The story is funny and entertaining, especially as Sophie demonstrates her twisted ideas about what it means to be good.

Unfortunately, the author writes himself into a corner and ends up with a disappointing ending that fails to take advantage of the milleu. The big reveals turn out to be not all that interesting, and the characters never end up being very fully developed. Ignoring the ending, however, it is a fun read and can be mildly recommended for airplane reading.

Review: The Temple of Gold

William Goldman, who wrote The Princess Bride, wrote The Temple of Gold as his debut novel. I'm a big fan of The Princess Bride, so when I saw they shared the same author and Amazon offered it for a low low price of $1.99, I jumped on the novel and bought it.

I shouldn't have. This is an awful, awful novel. The lead character is unlike-able, and does so many stupid things that at one point I just stopped reading because I just couldn't stand reading a novel about someone this stupid. This isn't even about him being an anti-hero, this is just stupidity. For instance, he recognizes when someone's really good for him in a relationship, but abandons the relationship anyway.

I eventually kept reading because I was stuck in a situation where I had nothing else to do, and kept hoping for a note of redemption in this novel. Unfortunately, there was none. Stay far far away from this book. I can hardly believe that the same person wrote The Princess Bride. Now I will hesitate to ever pick up another William Goldman novel again.

Review: The Ages of the Investor

The Ages of the Investor is the first book in William Bernstein's "investing for adults" series. It's unusual in that it provides an unconventional series of recommendations that I don't necessarily agree with, but makes good fodder for thought.

Bernstein looks at lifetime retiring savings as a human capital/financial capital trade-off model. In other words, when you're young, you have plenty of human capital in terms of future earnings growth, but very little in savings. When you're old, the reverse is true. He acknowledges that this view of things is simplistic, in that a young person can nevertheless fall ill, decide to have 12 kids, or do lots of other things to impair their future earnings growth, while his model of financial wealth includes all the risks involved in holding financial securities.

One of the earliest points of the book is that series risk is important. In other words, during your investing career, if you get to take advantage of low stock prices early on, it's a really big advantage, whereas if you get the penalty of a booming stock market in your early years, you don't get to buy stock at low prices, at which point any market crash can really nuke your savings. He points out, however, that if you get a lump sum and invest it all at once, you get to neutralize all series risk, and you avoid extreme outcomes and get to use the market average. This insight doesn't help much, Bernstein admits, because unless you get a big inheritance (or got rich from an IPO), there's no way to find this large lump sum.

Bernstein then examines folks at the beginning of their investing career. This part is not controversial. It's well known that young investors are unnecessarily conservative in their investments (mainly because it takes time to understand financial markets as well as how they react during a downturn), and should actually leverage themselves, as opposed to putting their money in a stock/bond mix. The problem is that most people don't want to use leverage, and even if they did, could quickly panic during a downturn. Bernstein recommends using a DFA-type portfolio instead to increase the risk that they take in their early years.

Then end game is where Bernstein's recommendations are controversial. His thought here is that once you've reached your "magic number", you should avoid taking further market risk. Well, the problem here is that there really is no avoiding market risk except by taking on inflation risk, and for any 30 year period, inflation risk is really high. He suggests a ladder of TIPS (Treasury Inflation Protected Securities), but doesn't point out that TIPS have really poor tax characteristics, and are also paying record low interest rates at this point. He also recommends purchasing an inflation adjusted annuity, but also points out that those have historically been very poor deals. He suggests value stocks, but again, those don't eliminate market risk.

Here's the thing, buying a ladder of government bonds during a period of unusually low interest rates is very likely to send you to the poor-house. Furthermore, once inflation returns, the interest generated from your portfolio would be insufficient to live on. This advice worked well for Robin & Dominguez, but they retired in the 1980s during record high interest rates. I'm not sure Bernstein is doing his readers a favor in 2013 by suggesting a similar route.

The only uncontroversial recommendation he makes here is to delay taking security as late as possible if you're in good health so as to get a great "annuity" from your social security income stream. Of course, if you're a die-hard libertarian I don't expect you to take that advice. Even worse, his examples don't note that those who have their assets in mostly taxable accounts actually have an advantage over those who have most of their assets in tax-sheltered accounts, which is the ability to control taxation through judicious use of when to take capital gains as well as substantial advantages to be found in using tax-loss harvesting. I'm not quite sure what to make of this omission.

All in all, the book makes a bunch of good points and gives you lots to think about, but I find Bernstein's recommendations here thin and not really very strong compared to the resources say, at The Retire Early Home Page. He doesn't even address those issues, or the very important question of how you would arrive at your magic number. While I think the book was worth the very quick read, I cannot give many of its recommendations my endorsement. Read and apply the advice at your own risk.

Review: Wheat Belly

My doctor actually recommended Wheat Belly, or I wouldn't have picked it up. Cure Your Child With Food, for instance, already mentions that gluten, the protein in wheat, is the source of many digestion problems. That book reported loads of success curing kids by eliminating wheat and anything white from their diets.

The Wheat Belly proceeds to blame almost all modern ills on wheat and wheat products. As in Cure Your Child With Food, he claims that wheat has been so genetically engineered or otherwise manipulated that the nutrition in it is not something that your body can absorb or deal with, leading to a bunch of diseases ranging from diabetes to acne (!!) to early balding in men. The book is replete with anecdotes from his practice where the patient is miraculously cured after eliminating wheat from his or her diet.

Unfortunately, things are not that simple. You see, Doctor Davis doesn't just recommend getting rid of wheat. He recommends eliminating all forms of whole grain and potatoes as well as the sugary fruits. Adopt his program wholesale and what do you get? The Atkins diet. If wheat was the all encompassing evil he claims it to be, then there shouldn't be any need to eliminate all the other foods, so this prescription basically undermines the entire first 2/3rds of the book!

Now, it could very well be that gluten sensitivity (not necessarily celiac disease) is far more prevalent than you might think, and that many people with irritable bowel syndrome could benefit by eliminating wheat. But if you're looking for proof that wheat is the culprit, then this book definitely does not provide it. That said, he does reference lots of interesting data, including Denise Minger's excellent debunking of the China Study. There's a lot of interesting information, though again, since he undermined himself in the last 2 chapters of the book I'm not sure how much I'd be willing to believe anything he says.

Not recommended.

Review: Pyle Waterproof MP3 Player with embedded headphones

I've been forced to swim a lot recently, and have come to the conclusion that lap swimming is the most boring sport in the universe. There's nothing to see, the scenery doesn't change, and you can't even hold a conversation while swimming like you can while you're cycling, running, or doing almost any land sport. I can't imagine doing it for any length of time long term.

After a while, I decided that it would be a good idea to find someway of listening to something while I'm doing my boring laps. If you're an iSheep, then the natural thing would be to pick up the Underwater iPod. These are basically iPod shuffles have been rebuilt with a waterproof resin internally and a waterproof coating externally, and then you can fit a pair of waterproof headphones to them, attach the whole shebang to your googles, and now you have an iPod that can play music underwater.

But I'm not an Apple fan, and $150 for a 2GB iPod shuffle is incredibly offensive to my senses. So I went looking and came up with the Pyle Waterproof MP3 player. At $40, it's more expensive than some other products, but it also had far better Amazon reviews. At 4GB of storage, it's got twice the storage of the Apple equivalents at one third the price, something very familiar to anyone who's familiar with how tech pricing works.

My first couple of swims were disappointing. The sound was muddy and unclear, and the headphone kept coming off. But I finally figured it out: the headphones come with 3 sets of ear pieces for underwater use, and what you need to do is to use the biggest ear piece that will fit in your ear canal. Once I got the right set (which surprisingly was the largest set), the sound was clear and lovely, and the ear pieces don't try to come off your ear. Now, if you do a particularly violent motion or if you knock your headphones with your strokes you still might get some leakage, but by and large the whole thing works and seriously, once I stop needing to nurse my back along I'm not going to swim more than a couple of times a week anyway.

In any case, my swims have gotten a lot less boring, and more than once I've found myself swimming an extra couple of laps to finish the song I've been listening to, so it's definitely changed lap swimming from "boring" to bearable. Recommended.

Review: The Story of The Human Body

The Story Of The Human Body is written by evolutionary biologist and Harvard Professor Daniel Lieberman. It's not just a boring history of how your various body parts evolved, but it's also an exploration about how mismatch diseases come about: diseases caused by the mismatch between your relatively old genes and the relatively unusual state of civilization today.

Midway through the book (page 173), there's a list of mismatch diseases that hold a few surprises even for me. For instance, apnea, ADHD, OCD, and chronic constipation are all considered to be mismatch diseases. I'm very familiar with Apnea, and I was surprised to find it on this list. The explanation is surprising: if you grew up on relatively soft processed or cooked food, you didn't have to chew very much or very hard, so your jaw ends up being a bit too small, which is one of the conditions that causes apnea. Lieberman suggests allowing kids to chew gum a lot as a way to help correct this deficiency, and I wonder if Singapore's ban on chewing gum could contribute to a rise in the number of children who end up with sleep apnea in the future as a result.

Which brings me to another interesting point about this book. Because mismatch diseases have long lead times and are caused by conditions in which the child grows up in, but the disease itself doesn't show up until in late adulthood, this book also doubles as a parenting manual of things that you as a parent should do, but might not have realized are important. For instance, he suggests letting kids run around in bare feet as much as possible to prevent future incidences of flat feet. This goes against the norms of civilized society, and parents should take note. Other little tit-bits from this book:

• Growing up in a hot environment will cause your child to develop more sweat glands. This may or may not be a good thing, depending on your point of view.
• Baby fat is not necessarily benign: even if the kid grows out of it, being fat at a young age causes your body to have more visceral fat cells, which can lead to being more easily fat as an adult.
• Myopia could be caused by spending too much time indoors, and insufficient variety of visual stimuli. Having a wide variety of visual stimulus is important for normal vision.
• If your kids get antibiotics, it might be necessary to follow up with a dose of probiotics to help the stomach flora return to normal.

If you don't have kids, there are lots of other fascinating topics that are relevant to you:

• Sitting is very bad for you.
• Human beings are basically the fattest primates around, but there are good reasons why.
• Why do men get prostate cancer?
• Why do you tend to get back pain as you age?

These questions all have lots of fun answers in Lieberman's book, plus a huge dose of evolutionary history which explains why if agriculture was such a hard life compared to being a hunter-gatherer, humans adopted it anyway.

Lieberman ties off the book with a bunch of policy suggestions as to how to prevent many of the mismatch diseases he describes. I have a very pessimistic outlook on those suggestions, as the long feedback cycle (40 years or so before diabetes begins to show up) ensures that much like global climate change, there's no real incentive for government to do anything about it.

I thoroughly enjoyed this book and found it incredibly informative. It's very likely to be the best book I've read all year. Highly recommended.

Review: Skating to where the puck was

Skating to Where the Puck Was is part of William Bernstein's series called "Investing for Adults". I did not consider the previous book I read in the series, Deep Risk, to be worth the trouble, but I have a different opinion of this book.

Bernstein points out that in many cases, by the time an asset class is widely accessible to the masses for investing, it has lost most of the attractive properties it used to have, therefore rendering the asset class much less interesting. The first example he uses is from David Swensen's Pioneering Portfolio Management: the Yale Model, with its reliance of alternative assets, including hedge funds and other such, returned outsized success until it became widely known and copies, at which point it stopped yielding those outsized returns.

Similarly, he points out that recently, an individual investor could make outsized gains in the housing market by buying up houses and renting them for profit, but doing so would have required that you make a full time job (or serious side job) out of it, not by merely investing in an REIT. Similarly, the Japanese stock market returned incredibly high yields when John Templeton bought into it very early. So early, in fact, that when he first bought shares in the market, they could not even be taken out of the country! By the time generalized Japanese stock funds became available, the return on those funds going forward was dismal. The result, Bernstein says, is that:

if your portfolio looks like the Yale Endowment's, then you're likely to find yourself chairless when the music stops. Diversifying is easy; doing so early is difficult.

The solution? Boring old asset allocation and staying in the market for the long haul. There a really is no Santa Claus, and no tooth fairy, unless you're the next John Templeton and have the courage to get in ahead of the crowd. (And even then, there's no guarantee that you're not the next Bill Miller instead)

The book repeats stuff you probably already know as an investing adult, but the stories inside are worth a quick read and the book is cheap. Recommended.

Review: 3M Command Strips

I never really was into hanging photos or artwork on the walls, even photos I took myself. It wasn't until recently that I figured out what. It turns out that nailing holes in the wall is a somewhat permanent act, and I didn't like the irrevocability of putting a photo up.

One of the helpful folks at Orchard Supply inadvertently pointed that out to me when I asked about buying hanging fixtures. Thinking that I rented an apartment, he told me about 3M Command Strips, which are essentially matching sets of Velcro backed by sticky tape. The clever thing about the Command Strips is that there's a tab on the back of the sticky tape which stretches the glue in the sticky tape so that the entire strip comes cleanly off the wall when done.

A few things are necessary to get these to work right. First, you should use them only as recommended for their weight ratings. Secondly, you need the surfaces to be clean. Lastly, you actually have to follow the directions. We've hung a mirror and 2 pictures with these trips, and I'm very happy with them. I haven't actually tested the removal, but judging from the Amazon reviews, that's not actually a problem.

Recommended.

Review: Cure Your Child With Food

Cure Your Child With Food is a book about nutrition and the impact nutrition has on children's health and growth. It's an interesting book in that it's organized with each chapter meant to be read independently, which leads to a lot of repetition.

For instance, my impression of the first half of the book is that she's a one-trick pony. She seemed to have only two solutions for the patients who come to her: get rid of the diary in the diet, and ditch the gluten. Get rid of the American "white diet". That's it.

The second half of the book, however, does demonstrate that she doesn't just prescribe one thing for all patients. For instance, one patient came to her with sleep problems and an otherwise healthy diet. Getting her onto 0.5mg of melatonin supplement an hour before bedtime meant she could sleep through the night. She explains why melatonin is a good solution and why it is not addictive. Another patient came to her from a vegetarian background with muscular development issues. Adding choline and fish oil to his diet resolved his issues. She does caution that sometime fish oil by itself isn't enough and that other forms of intervention are required. She diagnosed one case of a patient ingesting pesticide from fruit.

She presents interesting theories about why there's been a recent rise in gluten sensitivity (not the same as celiac disease): the amount of gluten in wheat that has been harvested has gone up, due to "improved breeding" and other interventions. She also explains why she recommends fish oil supplements over just adding more fish to the diet: the risk of mercury poisoning.

While the book is wordy and repetitive, I found it useful in thinking about children's nutrition. For instance, once you take your kid off infant formula, you should think about where his Omega-3 is going to come from. In our case, it was more palliative than anything else, but it's not quite a "one trick pony" book that the first half of the book presents itself to be. Recommended.

Advanced Reader Copies of my next book now available

It's called How to Interview A Financial Advisor. It's a short book, about 50 pages, and the first round of beta only has 20 copies available. Since it's currently in beta, it doesn't have a cover yet (I'm waiting for the cover to come in), and the PDF copy doesn't have an index. If you make comments about the book that lead to changes in the book, you'll get to be on the acknowledgements page.

The book is priced low $4.95, and I'm still trying to decide on the final pricing. As a perk, beta customers will also get cheap access to the printed copy when it is finally available.