Fun With Numbers

It gets to a point with numbers that you start to lose your sense of perspective and relation, especially with money. I can relate to and understand $100,000. I can even relate to one million or one hundred million. But after a point, we start to lose our reference point and it turns into monopoly money and politicians know that. Does $400B dollars really feel twice as big as $200B? Not to me. It's lost perspective. So, it's important to express these numbers in something we can relate to.

Obama's $825B "emergency" stimulus plan (I put "emergency" in quotations because only 3% spent in the first year isn't much of an emergency) is like spending:

$1,000,000 a day for the next 2,260 years.

Yes, that's right. The next 2,260 years. One million dollars. Every day. From now until the year 4269. 4269.

Not enough? Try buying this 14 bedroom, 18 bathroom, 33,000 sq. ft. home in Park City, Utah every hour, on the hour, for the entire length of Obama's first term.
















That's spending $23,500,000 over 35,000 times. That's a lot of 23-million dollar mansions. Enough to give every single Senator and Congressional Representative a mansion in each state and still have over eight thousand mansions left over.

Crazy big numbers. Keep them in perspective.

YFNN

Week One Under the Messiah

Summary of week one under the rule of "the chosen one".

1) Has his preacher friend declare that whites are racists for him.
2) States his intent to implement national gun control.
3) Pisses off press corps by not answering questions and talking down to them.
4) Acts like a jackass to the Senate minority whip.
5) Appoints Nancy Pelosi as dictator of national fuel economy standards.
6) Announces closure of terrorist retention facility.
7) States intent to pull out of Iraq ahead of schedule.

I just can't get enough change.

YFNN

I Think My Dog is Trying to Kill Me

My dog, cute and wonderful as he is, is trying to kill me. Or at least watch me sprawl on the ground in pain.

You see, he's got this thing where he needs to be precisely where I am at all times (unless he's actively trying to kill my wife by the same means at that moment in time). When groceries are being brought in from the car and put away, he's in the doorway to the kitchen. When dishes are being done, he's between me and the dishwasher. When I'm on the couch, he insists on laying on the floor where my feet will go when I get up. When I get out of the shower, he's there.

[Aside: Personally, I think he likes seeing me naked, but doesn't want to admit it. Every time I catch him looking at me right out of the shower, he does this thing where as soon as we make eye contact, he looks away and pretends he didn't notice me there. ]

Fortunately for me (and him) my cat-like agility (do you smell burning pants?) allows me to maneuver around him most times, avoiding a loud and likely painful trip to floor. My little hop, hop, big step, shuffle usually prevents me from stomping on him as he lays unwavering on the floor. If, by chance, I do happen to clip his tail or leg while dancing around him, he sits up, looks at me all appalled, like I'm the a-hole. Um, you're the one laying under the footrest of the recliner, jerk.

I'm pretty sure his preferred method of attempted murder is the stairs. As I approach the top of the stairs (to go down), he will actually wait behind me until I'm on the second or third step before he tries to rush past in an attempt to send me to my clumsy demise. If I happen to walk down the stairs after him, he'll try too. I'll be going along at a pretty good clip right behind him and he will suddenly stop. Just BAM! Stop. And I have to grab onto the wall to keep from going ass over melon over him and down the stairs.

So, if any of y'all ever find me dead at bottom of the basement stairs and Dempsey with an aloof-yet-guilty look on his face, you'll know really happened.

[Aside #2: Yes, that's him at the top of this post, there. Can you see the demons in his eyes? And yes, as his shirt states, he is indeed "bossy beyond belief".]

YFNN

Changes, or a Complete Lack Of Them

The following post is a YFNN rant. You may find it offensive, crude or just plain wrong. Get over it.

How many times did we hear from now-President-elect Obama that the Iraq war is poorly run, full of bad management decisions, and going horribly? All the time.

So, in order to rectify that problem, he sticks with the same guy that's been running it the whole time: Robert Gates.

In his cabinet so far, he's picking old school Dems that have been around Washington for years (Daschle, Clinton, Waxman...seriously?) and now keeping the existing Secretary of Defense, who's been the target of immense amounts of hatred from his own mouth.

Yessiree, Barack, you are definitely change we can believe in.

YFNN

Thought for 10/27/08

The following post is a YFNN rant. You may find it offensive, crude or just plain wrong. Get over it.

If there is a moral to the story of the ongoing financial bailout and the current state (and apparently future state) of politics and the country in general, it's this: it truly pays to be a loser. Irresponsibility and self-proclaimed helplessness can be very profitable.

All my life, I thought I was smart: saving my money, making prudent choices, living within my means, working hard while I got a good degree at a good school. Had I known the government would do their best to punish me for hard work and success, and reward my neighbors who sit home collecting welfare (in all of its forms) and watching Judge Judy, I'd have asked the unproductive and fraudulent to make room on their rent-to-own couch for me.

I shoulda bought a bigger house I couldn't afford with an adjustable-rate mortgage. I shoulda backpacked through Europe on credit cards to "find myself" after college rather than pay student loans. I shoulda tried to flip condos in 2004. I shoulda had kids at age 19. Man, did I ever blow those opportunities.

It clearly pays (and will continue to pay after 01/20/09, apparently) to make poor decisions and declare yourself helpless and hopelessly inept. Hard work and good decision-making is for suckers. It's time for me to stop paying our mortgage so I can get in on this free money gravy train.

YFNN

Old Age at 28?

I'm only 28. I feel old.

Examples:

1) I can't drink a lot of caffeine anymore. In college, I used to be able to suck down a couple bottles of Coke doing some homework, and still fall right asleep. Shortly after that, I was drinking Diet Cokes all day long, sometimes up to nine or ten a day (soda is free at TCFWIW). But, one night I was sitting on the sofa, watching television with a Diet Coke in hand. My chest started to get tight, my left arm started to tingle, and I got that shortness-of-breath and heart thumping that you get when you get really scared. I thought "Oh boy, these are heart-attack symptoms and I'm only 26." So, I went to the doctor and had a stress test done, as well as lots of other scans. As it turns out, my health is very healthy, even more so than most people my age, and everything else was normal. So, the doctor turned to my diet. As soon as I mentioned the amount of Diet Cokes in a typical day, he stopped me and stated that was my problem. So, I dumped caffeine almost entirely, cold turkey. Those first two weeks were the most painful I've ever experienced. Relentless terrible headaches, sleepless nights, and general crankiness were par for the course. But, caffeine is gone and I'm likely healthier for it. I still miss that sexy silver can, though.

2) I play "mystery bruise" in the shower. When I was younger, it seemed like I could practically whack myself with hammer and show no marks. What daily injuries I incurred seemed to heal before my very eyes. Now though, I get bruises that I have no idea where they even came from. Did I run into a table? Did I bang my arm on something? Who knows for sure, but it seems like I get bruises for no good reason now. When did I become so fragile?

3) I went from an iron stomach to one of paper. In my younger days, I could eat two dozen super-hot buffalo wings, some chili, and some warm Dr. Pepper in one sitting and feel like I could run a marathon. Now, my stomach moans and groans just at the thought of a greasy pizza or Chinese food. What the heck happened?

4) I take vitamins. When I don't take vitamins, I'm sluggish, cranky, and achy. If I miss my gingko biloba, I'm stuck with a dull headache all day. Am I really this close to a shoebox-sized box of pills with the days of the week on it?

Like I said, reality smacks me around on a pretty regular basis, but Mother Nature has been more than happy to throw some extra jabs and uppercuts my way over the last couple of years. With my birthday coming up shortly, it sure seems like she's not holding back now.

If anybody finds a fountain of youth, let me know, okay?

YFNN

Green Peppers and Gasoline

This obsession that some people have with gas price fluctuations is getting way out of hand. People seem to think that gasoline is the only commodity whose price moves up and down on a weekly, or even daily basis, and that loads of money can be saved by shopping around. Truth be told, gas prices really aren't too volatile, especially compared to some other regularly purchased items.

When I get home from grocery shopping, I take my receipt upstairs to the office and go over it in detail. I do this for two reasons. First, I want to make sure that what I paid was correct, and that I wasn't charged something way out of line for toilet paper or ground sirloin. Second, I want to generate some illustrative data.

"Wait, did he just say 'generate illustrative data'?"

Yes, I did. Remember, I'm a data man. Things like this should no longer surprise you.

The prices that I paid for regularly purchased items (bread, milk, chicken breasts, green peppers, etc.) are logged in a spreadsheet (surprise!) and I track them over time, generating trend curves for their prices. For example, I can tell you what the low price I've paid for chicken breasts has been for the last six months, and I can tell you the average price I've paid. This way, before I head over to our Giant Eagle grocery store, I can see what I've been paying historically, and make a decision as to whether I should buy something now (because the price is below my average), or if I should wait until next trip. That said, my grocery-shopping methods and adventures should probably be another post. Back to how this relates to gasoline...

What I'm getting at is this: produce and meat prices fluctuate far, far more than gas prices ever have. Even when you throw out sale price ups and downs, they're still far more volatile. And, you can save more money driving across town for cheap vegetables than you can by driving across town for cheap gas.

Example: The last time I went to the grocery store for green peppers, they were priced at an outrageous $2.19 each at Giant Eagle. So, of course, I didn't buy them. However, I still needed them for a recipe, so I went to Kroger instead. They had them for $1.39 each. I bought two and saved $1.60.

Compare this to gas prices. I personally know people that will drive well out of their way to save a measly five cents a gallon on gasoline. But, by buying just two green peppers at Kroger instead of Giant Eagle I saved more money than buying thirty-two gallons of gas (more than two fill-ups) priced at a nickel cheaper. How absurd is that?

Furthermore, I use coupons at Giant Eagle and regularly save around 7-10% because of it. On a typical $250 a month food budget, I save $20 to $25 just by cutting out a few slips of paper from the newspaper. In order to save the same amount of money on 5-cent discounted gasoline in a month, I'd have to drive over twelve-thousand miles in only thirty days! That's almost as much as I drive in a year! I save far, far, far more money by clipping coupons than nearly anyone ever will by changing their habits about gasoline.

There are a ton of places you can readily yield more savings if given the same amount of effort that many people do trying to penny-pinch at the pump; green peppers and coupon clipping are just a couple. Yet, lots of people moan and groan about the fluctuations of gas prices and drive well out of their way for five or ten-cent discounted gas, yet completely neglect to clip coupons or merely price shop for other items. It simply doesn't make sense.

So why do we have this undeserved obsession with gas price ups and downs? I think it's simply because gas prices are constantly in your face around town and constantly pounded into your mind by the media. When was the last time you heard Katie Couric say "Kraft Cheese Singles hit their highest price in six weeks, today..."?

In fact, most prices look outrageous when you put them on tall signs in big numbers. If you see huge numbers displaying the price of gas every single day, you can't help but notice and track them, and of course, I still do. But, I certainly won't go out of my way to find the cheapest place to purchase gasoline.

Green peppers, though, is another matter entirely.

YFNN

Rant: ARMs and Due-Diligence

The following post is a YFNN rant. You may find it offensive, crude or just plain wrong. Get over it.

due diligence
n.
1. the care that a prudent person might be expected to exercise in the examination and evaluation of risks affecting a business transaction

As I putt around the house on the weekends, I listen to the news of the week, either via XM radio or downloaded podcast on my iPod. Today, I happened to be listening to XM Radio, where a discussion was taking place regarding the number of foreclosures in today's housing market. The majority of the talk was regarding the big, bad mortgage lenders that provided adjustable-rate mortgages to folks looking to buy a house. These adjustable-rate mortgages, or ARMs, most of them anyway, are past their fixed periods (1-5 years typically), and are now, as their name suggests, adjusting. Wow, who'd a thunk it?

Apparently, there's a significant amount of people out there that are getting burned by these loans, which, in my opinion, is largely due to their own ignorance. This radio program actually had a soundbite of someone that said their payment doubled from a manageable $1200 a month to a payment of $2400 a month. They went on to say that they "couldn't afford the payments anymore" and "didn't realize that their payment would change." Several others were quick to jump on board and blame the lenders. Quotes like "I didn't know what I was signing," and "I never thought an adjustment would make my payment increase," were abundant.

I have a couple of points to make to these people regarding this, all of them pretty well summed up with the statements "Why did you not think or do research?" or "Why were you so lazy?"

First of all, at the time the vast majority of these loans were written, mortgage interest rates were at all-time lows. Let me say that again and really make sure that I'm absolutely crystal-clear:

All. Time. Lows.

If mortgage rates were at all-time lows, which direction did you think the variable interest rates would go? Maybe, um, up? I can understand that there are situations where ARMs are smart loans, but in nine loans out of ten, why would you take that risk when fixed rates were so low? I just don't get it.

I guess it really comes down to people buying into more house than they could really afford, which is stupid. If the only way you could afford the payments on the house was to go with an ARM, or worse, an interest-only loan, it's gotta be a pretty big red flag that you're almost certainly buying way more house than you can afford.

Second, I have absolutely zero sympathy for the people that claim ignorance and blame the lender in these situations. One of my number one rules for investing is to not get involved with an investment that I do not understand, and I think that rule definitely applies here. It's not like the lenders are hiding the information from the borrower. Every loan has their conditions clearly stated, and the information is easily available via the internet, bankers, or others. It is the responsibility of the borrower to perform due diligence and fully understand what you're getting into. If you need to, get a lawyer or a non-drunk friend (preferably someone that can read) to look it over and explain it to you. Claiming you didn't know what you were signing is yet another way of blaming someone else for your irresponsibility. It's your duty to understand it! Nobody is forcing your hand to scrawl your name. If you don't get it, don't sign it!

I guess what this really boils down to is that I'm just tired of people not taking responsibility for themselves, which has certainly become a disappointing trend in recent times.