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October 25, 2015 / paulio10

The New Economy of Natural Rule

The closer an economy comes to working like Nature’s own natural energy, the more it will thrive from fundamental principles found in nature, such as:
* self-healing (skin, flesh, plants, trees, etc.)
* cooperative living for greater accomplishments
* symbiotic or win-win relationships
* smoother expansion when the quantity of beings grows (all the people, all the plants, etc.)
* smooth contraction when the quantity of beings shrinks
* endless and limitless energy

Closed vs Open Systems

Unlike today’s closed-system monetary systems, nature operates as an open system.  There is no maximum number of ducks that can be born into the world, or people, or blades of grass, or any living thing.  Each duck, each person, each blade of grass is not dependent on all the others; it operates independently.

With money — there is a finite, maximum amount available; it is a closed system.  For me to have more, all of the people combined must have less; there’s nothing I can do to create money, no matter how hard I try.  Of course today’s economies have a government-driven entity that can inject new money into the economy (such as the Federal Reserve in the United States) which can add new dollars to the overall system and remove dollars any time they decide to. That sort of thing would be called the “single-point-of-failure” in the computer industry, where you have all your eggs in one basket; but that’s not the main problem with this system.

With energy — it is an infinite resource. There is no maximum or minimum; it is an open system.  There is no central authority controlling everything from a specific location, so there is no central point of failure.  There is no centrally-driven limitation.

Your body’s energy is a good example of Nature’s energy. Your body’s energy works exactly opposite to how money works today:

The more ENERGY you use up today, the MORE you will receive tomorrow.
* if you exercise your body, you will have more energy tomorrow; if you lay in bed doing nothing all day, you will have less energy tomorrow.  Misuse and non-use of energy provides less in the future; right use provides more in the future.

The more MONEY you use up today, the LESS you will have tomorrow.
* if you spend a lot of it today, you will have less money tomorrow; if you spend nothing all day, you will have all of it left tomorrow.

For example, if I have 50 dollars today and don’t use any of it, I still have 50 tomorrow – the world wasn’t improved by my efforts, but I was rewarded for it – I had 50 dollars the next day – when you think about it, this is just wrong!
If I have 50 dollars today and spend all of it in the best way possible to help my fellow people spontaneously, I have no money at all the next day.  This is also wrong!

It’s obvious we need a monetary system that rewards people for doing the right thing – spending their money to improve the world – rather than rewarding them for selfishness and inaction.  In economics we have the concept of the “velocity of money,” which can be measured. But what about the velocity of work being done? What about important work that has no money behind it, so that work does not get done?  Maybe we should focus on measuring the Velocity of Work Accomplished instead.

Voting-based Systems

How could we possibly invent a new economic model that more closely replicates how Natural Energy works?
One possible system could be a voting-based system.
Because the big obstacle is this: who or what is the deciding factor on how much money you should receive tomorrow, as reward for the things you did today?  It shouldn’t be you, because you are too close to the work that you did to see it clearly from a vantage point to properly judge its value.  Selfish people will try to get more than the value of the work they did.  Self-unsure people will tend to ask for less than the value of the work they did.  The bottom line is, the person doing the work is too close to the work to accurately judge its value – it needs to be measured by persons separate from them.

This problem has been solved in various ways on certain open Internet news and blogging sites today.  The creators of those sites desired something that seems impossible – a standard way of rating the quality of comments on articles written by individuals, in such a way that the “best” comments can bubble up to the top, with lesser comments following them, in descending order of “goodness”. But how can you have a standard rating system when no two people will ever agree on exactly what “good” is?  It makes you think: who is our audience, so that we can accurately measure these varying degrees of “good”ness among the tens of thousands of comments written every day?  Once we know who our audience is, that could change over time, so how do we monitor changes in our audience’s values and beliefs, so as to maintain maximum “good”ness as the dynamics of our audience change over time?  And how do we automate all this, so that no small minority of people can monopolize the system, either accidentally or intentionally misjudging comments?  If nothing else, natural human fallibility will tend to vary the comment-voting-quality over time, which will then be noticed by the people who use the system, they’ll get mad and discuss it far and wide, and the whole system will lose respect by the people as being a flawed system.

These seemingly insurmountable problems have been largely conquered in various ways on some web sites today.  My favorite system is the one implemented by Slashdot, which works roughly like this:

Anyone can sign up to be a moderator. Moderators cannot be anonymous, the web site knows who you are. Once you are granted moderator status, the web site will randomly select you once in a while to moderate a set of people’s comments.  You cannot moderate more than a fixed number of comments that the site determines, say, a random cross-section of 10 comments from various recent articles on the web site. You read the article, read the comment, and make a judgement about the comment: was it appropriate or inappropriate? Was it off-topic? Was it funny? Interesting? Insulting? Trolling or Flame-baiting? Was the comment related or unrelated to the article it was supposed to be commenting on?

[ Reference: ]

However, you may quickly discover a flaw in this system – what prevents people from incorrectly moderating comments, for their own personal biased reasons?  What if someone doesn’t believe in a particular viewpoint (say, abortion) so they intentionally down-vote any comment that shows a positive-bias towards that viewpoint?  What if a group of people secretly agree to always down-vote anything written by a particular person or of a particular topic that they dislike?  This actually happened, and so the creators of Slashdot added this rule:

Moderators occasionally will be allowed to Meta-Moderate – that is, to moderate other people’s moderations!
A moderator can choose to vote on whether other people have done a proper job of voting, or not.
Each moderator only gets a certain number of meta-moderation “points” each time period, and the times at which they can do meta-moderation are randomly chosen. They never are allowed to vote on their own moderations (only on other people’s moderations), and they don’t get to see who the person is that they’re meta-moderating – they only see the minimum information needed to make a decision.  The web site presents them with the article, one comment on the article, and the decision the moderator made about the comment — they basically just choose if the moderator made a “good decision” or “bad decision”.  Voting up or down.  The web site keeps track of how many down-votes a moderator receives from meta-moderation, and if they have too many, then their moderation status is revoked for a period of time!

Moderators automatically lose their limited power over others in this system, when others (without seeing who they are) separately come to the same conclusion that they are not doing the job properly.

This kind of organization does an amazing job at controlling itself, and growing and changing over time, as the people using it change and grow over time.  It scales up as much as needed, if you have 100 times as many people, then there’s 100 times as many moderators – each person is only doing the same amount of work to keep the system working.  It can shrink by 100 times when needed, too.  It can grow and shrink by any amount.  And there’s no central authority, no human emotion or frailty swaying the system as a whole.

A New Model for Money

Our world could create a new monetary system as a variation of Slashdot’s moderation and meta-moderation system.

A person does some work in their society – they fix someone’s car, mow someone’s lawn, teach something useful to a group of people who all met together with a common goal, pick up some trash in the neighborhood or grocery store parking lot, etc.  Other people witness this work taking place, or at the very least, evaluate it “before” and “after” the work was done to understand the type and scope of work.  Those witnesses vote on what amount of “new money” the person should receive for the work they did today, based on a set of factors that needs to be chosen.  Maybe things like:  was the work beneficial or detrimental? how many people were affected beneficially? to what degree were they benefited? are there long-term/recurring results from this work, or was the value only short-term? For example, picking up trash is fairly short term; more will appear within a day or two. But teaching someone how to repair a car could last the rest of their lives – especially if they turn around and teach it to other people afterwards!  There can be a certain amount of passive-income, so to speak, from work actions that people take, when appropriate.

Another factor that should be considered is how much the money is going to help the person or their family.  The first amount of money is the most important, since it will be used to buy food; clothing; housing; essentials.  But additional amounts of money are less important to that individual or their family, once the essentials are already taken care of. So there might be a sliding scale: if you fix 1 car today, that should cover enough for food & clothing & shelter for 1 day at least.  If you fix 10 cars today, that will not be 10 X the amount you would have gotten for that 1 car, because the need for money was so much greater for the first part, less-so for the following parts.  Kind of a decreasing curve, like a curve approaching a limit.  Maybe it would look like:

1 car repair – 1.0 units of money, enough for today only.
2 car repairs – 1.5 units of money
5 car repairs – 2.0 units of money
10 car repairs – 2.5 units of money
100 car repairs – 4 units of money
(or something like that.)

Granting other people money by way of voting about them does not subtract money from you.  The money for them is “generated from nothing” and is an infinite source.  The work they did has nothing to do with the work you’ve done, so the money is not interconnected in any way.  Like points in a game.  Where do those game-points come from?  Does the game ever run out of points to hand out?  No, game points are a truly virtual currency. There’s an infinite amount of money/points available; it only varies based on amount & quality of work performed.

How Contributions Work

The same kind of thing holds up for contributions – giving to others.  If you give 1 money-unit to a poor person who literally has nothing, that’s super valuable to them – they can buy some food and eat today – so that was worth a LOT, and you should get rewarded 2 or 3 money-units for that service to humanity.  But if you give 1 money-unit to your friend who works hard every day, maybe that’s only worth 1 money-unit that you’ll receive tomorrow.  And, if you give 1 money-unit to a super rich person, that has so little value to them, you’ll only receive .05 money units for that service tomorrow.  If you give no money to anybody today, you get no extra money tomorrow (for contribution-based income).

How Teaching Works

If you teach another person to do something, and they do useful work in society because of it, you should gain a small portion of passive-income from that – because they wouldn’t know it if it wasn’t for you.  So now, each day you work, you receive maybe 1.1 units of money; you worked for 1.0 units, and were paid a passive-income of 0.1 units from students you taught.  Maybe the percentage should go down over time, because 20 years from now they probably aren’t using as much of your knowledge as they will be 1 year from now.  But you should receive some small remuneration for the rest of that person’s work-life, for it.

How Passing Away Affects Income

Married couples and families often depend on a single individual’s income, or two individual’s income for all parties involved.  Because of this, it can be hard when one “bread winner” passes away.  Because of that, there should be a sliding scale decreasing the money coming into that family group over time.  This gives the other members time to figure out some way of generating their own work-income, rather than being hit with the financial loss all at once.  For example, suppose there is a married couple where he makes 2 money units per day and she makes 2 money units per day on average, but then he suddenly passes away.  The next day the widow should receive the full 4 units, with that number decreasing over time.  Maybe it decreases by .5 units every 6 months or so, so that only after 2-3 years she is dependent solely on her own income.  Or maybe there’s an logarithmic component to the decrease.

Satisfying Need  – Supply and Demand

There are different kinds of need in the world.  One type is manufacturing of parts to be assembled into larger items.  If you are the only one manufacturing a certain type of spring or screw or washer in the world, and those items are in great need, you are creating a huge benefit – worth lots of money-points.  If you are just one of thousands of people creating such items, or the need for those items is dwindling, that is worth less money-points.  This is the equivalent to “supply-and-demand” that we know of in today’s modern economics.  There has to be a way for Need to be met – increasing Need to be increasingly met, and decreasing Need to be decreasingly met.

So there needs to be some way of identifying the proper amount of money to associate with production of useful items and services, on any given scale small or large.  This may end up being a “big data” problem, the science for which is just now being developed in our society with software database design and analysis for Big Data.

It would be so nice to have a Big Data search engine that people could look up things in – find out the effective value of producing certain products, or providing certain services – so that they can decide whether to go into that business or not.

Large Scale Industry, Business

With such a unique monetary system as this, how can large business ever come up with large amount of funds as initial investments to get their business going?  How could a construction company begin working on a new square-mile of housing that they want to build?  Since the new money in this system is basically the energy of the people, the only way to raise money like that would be to attract thousands of people to commit their time and energy towards this useful common-goal.  If not enough people can be encouraged to do so, then something is wrong with the plan, because otherwise the workers and supporters would be there.  Humanity is quickly reaching the point where every bit of news that is interesting to an individual is available to them, without so much interference from unrelated and uninteresting bits of news.  Good projects in any category or location can be immediately known about to the masses, thanks to the Internet – increasingly so over time.  Perhaps some large-scale crowd-funding systems similar to Kickstarter or GoFundMe, but more tuned towards this new economic model.

Other Economic Areas of Interest

There are so many other areas that need consideration about how a system like this would affect them, but these can be discussed over time.  In the same way that electric cars (ala vehicles produced by Tesla Motors) have one-tenth of the moving parts of old-fashioned gasoline-engine cars – similarly, a new economy based on Natural energy may result in many complex economic elements to become unnecessary. Is it still important to consider import/export restrictions between countries? Would there need to be such things as stock markets, or Forex Trading, going forward?  What would these systems look like, how would their transformation come about?

How To Implement a new Economic Model

It can be extremely difficult to implement any revolutionary-new monetary system, especially on a world-wide scale.

First you must convince everyone about the benefit of the new model, not just those who are in the best position to implement it.  You try to understand and discuss all possible down-sides to the model, and hope you’ve thought of everything.

Then, you have to find a way to implement the new plan, by somehow shifting (as seamlessly as possible) from the current (failed) system to the new system. How do you gradually implement a new system that is completely different from the old one, and even has a variety of contradictions and conflicts with the old system?

Then, it takes lots of practice for everyone in society to become mentally and emotionally familiar with this new way of operating, with the new rules. It will take practice to stop all of our old, outdated behaviors and ways of thinking.

All of this seems like it’s too much all at once, it’s too difficult for everyone to absorb and thrive in.  The only way a completely new system can be taken on and accepted by everyone is if the old system becomes so manipulated and SO PAINFUL, it’s clear to everyone that there is no alternative but complete replacement.

The amount of work to implement and follow the new system must match the amount of pain of the old system, or people just won’t be willing to try it and keep at it until they get it.  Months and years later it will seem pretty easy to follow the new system, once the majority of people have overcome the possibly steep “learning curve” of the new system.  The people who often seek new and changing environments and circumstances will more easily adopt a new system of money than those who largely try to avoid change in their lives. But everyone will be inspired by those around them whom they see adopting the new system. When they see the benefits and reduced detriments, they’ll want that for themselves.

For example, if you need a new car because your current car is very old and is really breaking down, and you have the money to buy a new car, but you just haven’t purchased one yet because your old one still runs and you have lots of other things to do right now.  Your NEED for a new car is less than the work it takes to obtain the new car.  But then, suddenly, your old car’s engine blows up or the transmission falls to pieces. Now it’s much easier to get a new car, you’re much more motivated, because you have no way to get around!  Now the NEED is much greater than the work to get a new car – so you start shopping for one right away.

The length and depth of the current world-wide economic crisis will decide how different and how much of an improvement the new economy will be, when it is created and implemented.  The more pain now, the better the system that can be implemented in the future. It’s sad, but true.  The more painful now, the more obviously outdated and ill-fitting the current system is; the more of an overhaul it will require to get Humanity up to its next level of Finance – and greater happiness and benefit.

But, are the people in charge of the various economies today really able to feel the pain of the portion of humanity affected by that economy? They must be if they are the ones who will be replacing the old economy with a new one.  If they cannot feel this, if they cannot stay connected to what Humanity is going through, they will end up being left behind, as those who directly feel the pain work together to solve the problem their own way, as it always has been throughout history.  People naturally solve the problems and find ways to meet their needs and those of all the people around them.

In Summary

A Natural Energy economic system encourages right behavior, to maximize the benefit to all of Humanity – to provide the most to those who really need it, to create balance across all people.  Selfishness and separatism are naturally discouraged in this system, which is very good.  Right behavior is encouraged, since each person’s peers are voting on their work actions and accomplishments.

Such a system will prevent the poorest-of-the-poor conditions for all people in the world.  Such a system would help reduce excessive hoarding of funds; it would be very difficult to build up a large amount more money than you need for yourself and your family to live.  People would not care as much about the richest-people, either, since in an open system your own money is not affected by others hoarding all they can for themselves. In a closed money system, others hoarding/controlling massive amounts of money definitely affects you.

No longer are the masses struggling to “find employment”, it’s all around them all of the time.  If you can move, or even just speak, you can do work.  Whatever work you do will be rewarded by peers.  The reward to you is not subtracted from the peers – it is “generated out of thin air”.  This will help Humanity to more easily move away from being fear-driven animals of the past, towards becoming powerful Human Beings for the future.  An important accomplishment for any human being is learning the skill of not reacting blindly to waves of emotion and misdirected thoughts, but listening to all of their inputs (physical, emotional, and mental) and deciding consciously what the right thing is to do next, and doing it, despite fear-based pleadings from various internal voices.

There has never been this kind of self-healing, natural-energy-compatible monetary system on the planet before.

What would happen if a single country like Greece were to spearhead a whole new monetary system?

What level of pain are the Greek people going through now, and what level of change is required to solve the issues within this country once and for all?

Would Greece become the new world leader in modeling the next step towards happiness and success on our planet?

Perhaps the land which produced the greatest artistic Architects of the past will spawn the greatest Financial Architects of the future.

April 18, 2015 / paulio10

“All The Others” Around Us

There is a pattern to each of these stories, I assure you.

1. Ice Braking

I learned to stop my car while driving on almost-pure ice, when I lived in Flagstaff AZ.  There’s tricks to it – pumping your brakes, sliding your car half a car’s width to the right so the tires are on the part of the ground that has more traction (middle and edge of road), which works especially well in Flagstaff where they sprinkle cinders on the road to melt the ice and give traction – the middle (and edge) of the road have not been flattened-down and slicked-down yet by lots of tires – you can stop relatively quickly this way to avoid crashing into the car in front of you.

But the car behind me doesn’t know these tricks.  When the car in front of me suddenly began stopping for no visible reason, I was able to stop in time because of my knowledge and skill with using the above tricks. Of course the car behind me didn’t know these tricks.  Why should they bother to figure them out or learn them from others?  Resulting in a 15MPH fender-bender, rear-ending my car.  That was many years ago; very little damage, except for feelings; and wasted time exchanging insurance information; and missing one of my classes on the first day of class.

2. Programming

I learned Test Driven Development, writing Unit Tests and then writing the code to meet the tests; modularizing my code in ways that are easy to test and debug.  It’s so powerful and fun, it’s clearly the right way to program from now on.  But very few other developers I’ve ever worked with have bothered to learn this or care about it in the slightest, after much encouragement from me, so their code is horrible to look at and work with and horrendous to debug – which I have to do on a regular basis. All my life I’ve had to work with other people’s code that has horrible bugs that my code never has, because I don’t accept that level of pain in my life anymore – I found ways of completely eliminating entire classes of bugs from my programming.  Sometimes the original author has to find these bugs they created, and sometimes I have to find their bugs, which really is no fun for me.  Sometimes hundreds of people (“customers”) are inconvenienced by these horrible bugs.  And nobody cares. Management doesn’t care.  The team doesn’t care. The customers don’t care, even when they’re the ones damaged by the bugs.  And after an exceptionally huge bug, and customer complaints, and management investigations, and reports and analysis, nothing changes, so that it happens again, and again, and again. And it hurts me deeply.

Before I learned these advanced programming skills and discovered how great programming could be, I didn’t care about working on my coworkers crappy code, because I was just like them, writing equally crappy code myself.  We were one big happy crappy-coding family.  I got in trouble once in a while with these bugs, but who cares? Everyone else did too, so I was on equal ground.  Now that I know better and do better, I should feel better, too – but other people’s code is so painful to me now, and I don’t have time to fix it all, and even if I did, nobody would notice, and they’d just crap it up again.  And this seems to happen at every company I work for. And I put up with it, week after week, month after month, year after year. I’m good at fitting in and not raising a ruckus.  Deadlines are looming; let’s just get the code working by then, OK?

3. Organization Skills

I organized my life and my projects and tasks in such a way that I’m not late for meetings, I never have to say “oops, sorry, I forgot to attend your meeting!”  I don’t forget tasks assigned to me, I get them done and on time, after being told just once about them – dozens of them, even hundreds, some weeks.  Because I have a mechanism for recording and tracking what people have asked me to do, I even volunteer to take on work that I know I can do, where I’m the right person to do it – instead of avoiding everything, trying to hide, trying not to take on any new work, like most other people I’ve ever worked with throughout my 30 year technical career.  Not everyone is like that, in my experience, just, most people. People don’t realize that I handle tons of tasks from work, and an equally large number of tasks in my home life.  It takes hard work and effort, but I’m able to keep it all running fairly smoothly.  So now it pains me deeply to have someone ask me a technical question, but bring no pencil or paper to write down the answer.  I love explaining! I love being the go-to person! But they stand there looking at me, and make no attempt to write down the web site I told them about, the trick, the technique, the task I assigned them. (“Can you email it to me?”  yeah, sure, I guess…)  Then they can conveniently forget all about it later.  I feel disrespected when they have no recording device with them, and they have no idea I could possibly feel that way, because nobody ever brought it up with them before.  But this is a business!  Isn’t it?  So they end up having to be reminded 3-4 times to do the thing they agreed to do, and then they get angry about being reminded a 5th time, a week after they promised it would be done.  But whose fault is that, really? They should be mad at themselves, not me. Don’t shoot the messenger. I’m clearly demonstrating a weakness in your system. Fix your fucking system.

Before I learned to be organized, I was just like them, and we all would forget 20% of all tasks, miss 5% of all meetings, always be late everywhere we went, and it was all OK, just our bosses would get angry from time to time; but you know how the human mind is, you can’t remember everything, right?  Lame excuses – it worked for me.  I didn’t care back then.  Now I care, and I do so much better myself – and it pains me to experience everyone else’s cockassed lack of organization and follow through.  Have some respect for yourself, and for me, while you’re at it!  Can’t you do what you agreed to do?  Do what it takes to not fail.  Then you won’t feel like a failure so often.  Don’t you care?

4. Risk

I learned all about risk, and how business people think about risk – and discovered the 4 aspects of risk that you need to consider when evaluating any risk (what’s the chance of it happening, what’s the consequence of it happening, what can be done to mitigate the risk, and what is the cost of mitigating the risk).  It could be any kind of risk – to your business, to your family, to your life.  Now it pains me deeply when I say “I own a rental house,” and before I can finish the person I’m talking to interrupts with “ooohhh- I heard about that, my friend used to do that, he had this one renter who was absolutely horrible – punched holes in the walls, shredded the carpets, trashed the lawn, stole all the furniture, burned the house to the ground, jumped up and down on the ashes, and then the whole neighborhood exploded into a big crater, filed a lawsuit against my friend the homeowner, and LASTLY – stole the little flag off the mailbox in the front yard.  I don’t ever want to have a rental property!”  Oh really, well, good for you I guess, for giving up on something potentially valuable without doing any real research, or having any rational thoughts of your own.  Did you know you can have a management company handle tenants for you? Did you know you can do credit and background checks on potential tenants to help you find good ones? Did you know you can buy insurance to protect yourself against many of these things? How frequently did that actually happen to your friend, or is this a one-off story your friend told you? Because stories of happy tenants aren’t very interesting to tell? All I heard from your childish blathering was “I might get a bad renter who will cost me more in damages than I made in rents”, which I guess is sort of true, at least I can understand this purely-emotional fear as a basic risk that needs to be considered.  How about attending real-estate investing meetups for free, and asking 2 dozen people about their experiences with good renters and bad renters to get a balanced view?  Because everyone has a horror story. Can you find out how frequently the horror stories occur?  Can you discover if there’s anything that can be done ahead of time to make sure you don’t get one of those bad tenants?  And if you have a bad tenant, can you evict them before there’s a catastrophe? How does the law work with that? Is there any kind of communication you can do with them to ameliorate it before it escalates to the maximum level? You don’t have to be a lawyer, you can just ask people who have been there and done that.  Ask them what they are doing now to prevent it?  And if they say “oh, I don’t rent properties anymore, I stopped some time ago,” then you have to just say, OK, I’m sorry that you gave up… Next!  I’m done talking to that person – I’m moving on to somebody successful. If you can’t find any successful people, then your bullshit detector will go off, and you know not to waste any more time. But this is property investing, so every fourth person at these meetings is secretly a millionaire, and it really works, and you just need to learn what it takes to do it and overcome your fear.

I learned that risk can be understood, estimated, and mitigated – and that in the event of total catastrophe, there are steps you can take to protect your property and your business and yourself; there are many, many ways to be protected. But this lame person I talked to with the scary story didn’t bother to learn any of that. And nothing I say to them at this point will change their mind. It can’t be done, in my personal experience, so I just shut up and slink away. Which hurts me even more, because I’m here to help. I love helping, teaching, sharing, encouraging.  People want to stay in their pretend bubble, living their bubble existence, which is fine for them I guess. I kind of understand because I was like that at one point in my life. Would I have appreciated someone bursting my bubble when I was like that around age 20-25?  Hell no.  So I should probably leave them alone, as painful as it is for me to not introduce them to a small snippet, at least, of what a better life could be like – to overcome their irrational fear of evil destructive tenants. I listened to their irrational someone-else’s painful 1-off story; can’t they listen to my rooted-in-reality experiences of success in the same area?  The answer of course is: no.

I’ve learned that I can do a lot to reduce risk, but there’s always going to be some risk – and I’m going to be OK with that risk after all reasonable arrangements have been made, and keep moving forward, no stopping. Because a meteor could always come screaming down out of the clouds and flatten me like a coyote in a roadrunner cartoon – but I don’t worry about that risk because the chances of that happening are so infinitesimal, and there’s nothing I can really do within my budget to mitigate the risk of giant meteors – so I don’t waste my time and energy and emotions and mental thought about it. In fact, I’m sorry I brought it up. I apologize.

5. HOAs

I used to be one of the homeowners that would bitch about the stupid HOA, “they’re always fining everyone, complaining about everything, and charging money for everything.”  But then something interesting happened: a friend of mine was on the HOA board, and invited me to join them.  I thought, oh what the heck, might as well, I’ll learn more about our community, I’d be interested to see how much money they kick around every month anyway.  So I became a board member for 2 years, and did my best to work with the other HOA members, and really saw things from their point of view – they are ordinary homeowners just like me, with a thankless job to do, having to balance the expenditure of moneys entrusted to them according to a set of bylaws that they did not invent, and cannot change.  So many decisions have to be made where we understand BOTH sides, and you can’t have both sides win – one side has to win, and one has to lose.  So we make our decision. And somebody hates us.  The HOA tries hard to create consistent beauty and commonality within a neighborhood by keeping the lid on out-of-control neighbors, so nobody tears out their grass and leaves it dirt for 6 months; nobody parks their broken down 50’s pickup truck in their front yard and hangs the greasy engine from a nearby tree for 10 years, and nobody paints their house bright purple/orange/green/blue stripes because they personally like primary colors and fuck everybody else’s personal taste.  Each of those individuals bitches about the HOA leaning on them, and the rest of the community has no idea that the HOA has kept their neighborhood beautiful (or at least, consistent-looking), which maintains the value of the homes much better so if you ever have to move and sell your house, you’ll get many thousands of dollars more for your house than you would have otherwise.  So now it pains me to see people complain about the HOA fining them for leaving their ugly trash can languishing at the street curb for an entire week, when everyone else put theirs away behind their gates like you’re supposed to in this neighborhood to keep it looking nice and allow visiting cars to park on the street.  It pains me to see anyone complain about the HOA without attending a single meeting to ask why the rules are the way they are.  If they just would do that, they’d see that the HOA members have no other choice than to do what they’re doing, and if you were a member, you’d do the same thing yourself.  And if EVERY HOMEOWNER IN THE COMMUNITY came to the meetings and agreed that the rules were stupid, they could change it  easily – because a majority vote by homeowners is how these rules get changed.  But nobody knows these things, or bothers to find out. Changing stupid rules almost never happens, because truly, nobody cares.  They don’t want to vote, even when it’s in their favor to do so.  They don’t want to learn about the HOA, because they don’t want to change their mind, they are happy to have an enemy, and they don’t want to see the other point of view because they think it lessens their own point of view in some way that I don’t understand.  It’s crazy. This is a truly crazy world we live in.

6. Money Management

It pains me now to see poor and middle-class people wasting their money on stupid stuff, spending every paycheck 100%, sometimes 120% by way of credit cards and other debt – then spending the rest of their life paying huge sums of Interest to lending companies, which does nothing more than weakens their own spending power!  If you make $2000/month, wouldn’t you like to have the spending power of $2000/month?  You don’t, because you’re paying $750 in interest every month, so you only have $1250 to spend. Some of the interest you’re paying right now is for the stupid stuff you don’t even remember buying many years ago.  Such a travesty.  Every month you’re paying credit card interest, car-loan interest, house-mortgage interest, student loan interest, and if you don’t make the interest payments you’ll get late-fees which are even worse than interest.  Have you ever sat down and calculated how much mortgage interest you’re paying over the 30-year-mortgage you got on your house?  You might actually be paying more than a complete other house worth of money.  You can easily pay for 2-3 houses, but you end up with just 1 house!  And its totally legal.  People who spend all their money every month – you’re going to get old, some day. Are you not saving and investing for the future?  Simply saving money in a bank account won’t do it, not that anybody even does that these days.  Simply investing in a 401K or other lobotomized investment “tool” won’t do it either, except for highly compensated individuals who work their entire life and always contribute to the 401K at least 6% continuously, and never tap into that money for any reason before retirement.  Those individuals need about $3,000,000 worth of investment-savings in their IRAs and 401Ks to retire at a lifestyle matching their working one – I calculated it once.  I see it instantly now, very clearly, in all the people around me, and it pains me greatly.

7. Knowing but not Sharing

Sometimes knowing the truth about something, understanding how to relieve painful happenings, isn’t enough, especially if you can’t implement the knowledge you have.  Or in my case, I can implement it in my own life, and I’m proud of what I’ve done when I see it all working – then it hurts me doubly that (a) nobody wants to hear about it, (b) nobody wants to take fucking notes because it’s great fucking knowledge that could change their lives, and (c) nobody wants to implement it in their own lives to reduce their own pain and agony.

Maybe they don’t really feel pain as painfully as I do.  If they felt it half as much as I do, they’d reach out to anyone and everyone immediately, looking for better ways of living their lives; they’d listen with open ears to every word anyone had to say on the topic, they’d look to learn things they didn’t already know, they’d take notes in the day-planner or to-do app on the phone they carry around with them, and they’d implement what they learned for themselves – to see if it works or not.  They would never dismiss something as stupid or “not for me”, without testing it out, seeing it first-hand, before deciding to discard it.

8. Learn Other People’s Great Lessons

There are great lessons that the richest people in our world have mastered – which have been written about in books, and taught as lectures, which you can search out and learn for yourself, for free, or for a very low price. Mostly free, now, thanks to the Internet and local meetup groups.  I mean this for many variations of the word “richest” – financially, spiritually, physically, emotionally, mentally, creatively, cooperatively, etc.  You can learn real investing, and do far better than any stupid lobotomized 401K or IRA after a bit of practice.  You can have the worst memory of anybody you’ve ever met due to the horrible childhood illness of Asthma wherein you spent dozens of sleepless hours at a time sitting upright in bed, struggling to breathe every breath, your brain oxygen-starved for permanent brain damage, year after year after year, and survive.  And hide, keep to yourself, the knowledge that you will never be able to get good grades in school because of your disability. And nobody notices. And you discover that in the real working world, you’re going to fail at job after job, because you can’t remember anybody’s name, you can’t remember all the masses of technical details you need to remember to get your job done. And still, nobody notices. Until you figure out a few coping mechanisms on your own, one by one, to barely scrape by. And then you’re shown the Getting Things Done techniques of David Allen, life organization and balancing skills of Tony Robbins, how to think like a rich person to understand how our economy, business, and investing really works by reading Rich Dad Poor Dad and Cashflow Quadrant books by Robert Kiyosaki, the organization systems of Franklin/Covey, the emotional-healing techniques of TAT and EFT that can literally cure you of certain hangups (and even some physical ailments) quickly and save you decades of expensive therapy, and finding spiritual leaders who really talk to your heart despite what anyone else in your family/life has trained you for. And you read the books not once but many times over, watch the videos many times over, listen to the audio books and podcasts over and over, and implement the techniques for yourself, your own way, over time.  And then you re-read, re-listen, and add more and more elements as new things make more and more sense to you over time.

Oh … did I say “you”, in that diatribe?  I meant me, of course.  Sorry about that.

The Pattern

There is a pattern to all of these stories, which is this: you don’t live in a vacuum.  You should absolutely do everything you can to improve yourself, make yourself the best “you” you can be!  But understand, also, that much of your fate belongs in the hands of everyone else around you.  Just because you learned to brake on ice, doesn’t mean that you can never get into accidents now on ice – actually, you may have just signed up for an entirely new type of car accident, in some ways caused by your new learnings! I cannot express how infinitely frustrating this is for me. But it’s part of how our world works. I don’t know any way around it, because you can’t force everybody else to be “like you” – the world doesn’t work that way (and it shouldn’t). I guess you just place each newly learned thing into your “bag of tricks”, and then try to use the best tool for the job each time you encounter each new situation, and hope for the best.  That’s about the most you can do, I think, the rest is out of your control. I need to learn to relax when thinking about that.

October 2, 2014 / paulio10

Door Stops Done Right

Here are some needs that we all have, but nobody has solved it in the right way yet.

Need #1

You open the door of your house. Because of the way it was oriented when it was attached to the house, it’s a tiiiiiny bit off-axis, so the door always swings open to the maximum amount; you can never leave the door open half-way.  Or, it angles the other way, so it swings closed always – you can’t leave it open half-way, or all the way – it always closes on you.  If only there was some kind of hinge-goop you could add that would increase the friction within the hinge a tiny bit, like, the opposite of oil, whatever that could be. You want to avoid making the door hard to open and close, and you don’t want it to start squeaking; just something to counteract ghostly-swinging-door syndrome. You know, like how a laptop lid can be tilted at any angle and it stays there – successfully fighting gravity’s pull on the screen – how do they do that? The laptop lid doesn’t slam shut, it stays at any angle. And over time it never loosens too much, the hinge never squeaks, even after you’ve used it every day for the past 4-5 years. And it’s such a small device, it fits in a laptop hinge!

Need #2

You probably have a door-stop on your door so when you swing it open too strongly, the door hits the stop instead of smashing and denting the wall or crushing the baseboard. There are 5 types of door stops in popular use today, which I like to call:

* the small door twanger:


* the large door twanger:


* the solid metal door stopper:


* the hinge-pusher:

door-hinge-stop        hinge2-stop

* the doorknob wallplate:


At least where I live in the western United States, these are the only types of door stops I’ve seen, and I’ve looked inside probably a thousand houses or more in the past 10 years.

All of these have the same problem: they forcibly bounce the door back in the direction it came from!  That’s never what you want. If you flung the door open, you want the fucking door to be open, at least for now. Why would you want it to spring back in your face with near-equal force to the one you expended to propel it open in the first place?  That’s just ridiculous, and is a huge source of additional irritation when you’re already irritated after coming home from a long day of pointless meetings at a corporate job.  (OK, that’s me; maybe not you).

Look. You want the wall to absorb all the momentum of the door and throw it away, so the door doesn’t have any impetus to bounce back with – no matter how weakly or strongly the door is cast open. It turns out we’ve already invented this kind of device, in fact you have four of them on your car. Every car has them. They’re called shock-absorbers. There are two parts to a shock absorber: a spring, and a strut or dampener. The idea is that the spring counteracts the energy coming at it exponentially – the harder/faster the object is going that compresses the spring, the more the spring pushes back. And, if you put a LOT more energy into the spring, it only compresses a little more, not a lot. So the movement can be completely neutralized within a small distance.

Everybody knows what a spring is, a coiled bendable metal wire, that can be compressed (in this case); it retaliates by pushing back in an attempt to return to its former uncompressed shape and size.

The kind of strut or dampener I’m talking about is sometimes called a Dashpot (wikipedia article).  You don’t have to use a fluid for the medium in the dashpot, a lot of successful “gas springs” just use air for the medium, rushing around/between metal cylinders to provide the dampening action. Air-based struts are probably better than oil- or water-based ones, so that there’s nothing to leak out or evaporate away over time.


Now if all you use is a spring, you have the problem that all the energy stored into the spring will be pushed back onto the thing which compressed the spring to begin with! That’s the problem we have today, the problem we’re trying to solve.  The secret to solving this problem is to add a strut/dampener to the system. This thing slows down the momentum both when the spring is being compressed and when it’s extending back out again. If you choose the right spring & strut for the mass & speed of the moving object you want to dampen, like a front door swinging open, then it will be able to completely cancel out the energy of that swinging door no matter what speed is used to thrust it open.

You need both the spring and the strut, just like each of the 4 corners in your car, to solve this problem properly.

Failed Design of the Common Door Stop

If you carefully examine the two twanger-style door stops you’ll notice something interesting: the rings are already compressed as far as they can be without overlapping each other! This “spring” has no spring in it! It can’t compress, it has no where to go! That’s just a faulty design right there. As long as the door is not thrown open too hard it kind of absorbs some of the energy, and kind of throws the energy back into the door; at no time is the springiness of the metal wire being used properly.  If the door is thrown open harder, the entire thing bends at a 90 degree angle because there’s no guide controlling the direction of compression. Congratulations, it’s permanently damaged; it doesn’t spring back anymore. Time to blame yourself, as if it was your fault for opening your door too hard, and go buy a new one at the store.  That is so, so Lame!

We need a springy-spring, that’s able to absorb the right amount of momentum in a short distance (let’s say 1-2 inches). And, we need it wrapped around a dampener that can completely dampen all the energy of a solid wood door thrown open at the highest speed the human arm can swing it at.

How much fun would it be to come home from work, and SWING open that door as hard as you can, knowing you won’t be damaging your house?  Seeing/hearing the spring and dampener kicking in, protecting the house from your over-energetic arrival to your home?  It might feel good to do that.  Maybe we should also build in a sound-effect that’s louder/stronger the more momentum is applied to it – so you get a feeling of satisfaction from throwing open the door as hard as you can. Why not? It’s not hurting anything.

This kind of device should be fairly simply built with low-cost materials, so that it doesn’t cost too much when you buy one for every door in your house – inside doors and outside doors. I want Home Depot and Lowes to sell them for a nice low cost in a 4-pack perhaps.

I can tell you I’d buy at least two dozen of them, put them in my house, my rental houses, and give them away to my friends as holiday presents. Because, nice! Something actually improved in our world.

Today’s Shock Absorbers for Doors

The current shock absorber design for doors is pretty lame. It was designed in the 1960’s or earlier. You see it sometimes in industrial locations, offices and schools, when big-heavy doors are involved. It’s mounted usually in the center of the top of the door, and has a double-arm-hinge thing, the other end of which is attached to the door frame. Some of them work decently, pulling the door closed strongly but not letting the door slam shut – the dampening occurs in the last few inches of the door being closed. But a lot of the time they don’t work right. But they fight you if you want to prop the door open. Plus, they cost between $150-300 retail from what I’ve seen on the Internet. Too expensive.

I don’t want something big and obtrusive like that. It needs to be small and contained, and located down low, like where the twanger style door stops normally are mounted these days.

Building A Better Door Stop

With a little more design and consideration of low-cost parts, a really good Door Shock Absorber should be doable without too much effort. The parts should be simple enough and small enough, and the cost should be low enough that people can afford to put them on every door in their house. I wish I had time to design and build a prototype. Whoever actually runs with this idea could make a lot of money.

Future View of Houses

Everything in our house should be able to be used for many purposes. Every towel-bar should be able to support the weight of the heaviest human being on the planet. Because every little kid wants to do pull-ups when they see them! The first time you try it you break it, and mommy or daddy yells at you. This is no way to live, decade after decade from when the problem is discovered! Understand the problem and fix the fucking issue once and for all. Because, why not! A house should be indestructible. You should be able to do anything you want with nearly everything in the house. Why not!  What else should be stronger than it is today? Why are we still using breakable windows? There are many materials just as clear as glass, that don’t shatter and endanger your family and pets with sharp shards that can bleed you and send you to the hospital. Another totally ridiculous way to live.  Decades and decades later, we still haven’t yet done the first steop to fixing the problem. Let’s fix that shit.

October 1, 2014 / paulio10

Car Oil Changes – Not As Often As You’d Think

When you get your car’s oil changed, usually the technician places a sticker in the upper-left corner of your car’s window showing the next mileage when you should get your oil changed.

It’s usually 3000 miles past the current mileage.
And it’s a lie.

You don’t have to get your oil changed that often! If you use regular oil, every 5000 miles is just fine. If you use full synthetic, every 10,000 miles is just fine.

I have been sticking to this principle on our two cars since the day they were “born”, and it hasn’t failed me yet. Neither car has had any major repair during the entire time we’ve had them – and we use them a whole bunch.

We have a Toyota Sienna minivan – bought new by us in 2005, now has 140,000 miles on it and going strong. Oil change every 5000-6000 miles without fail, no major issues.

We also have a 2007 Lexus GS350 which I love driving – bought originally with only 30,000 miles on it, it now has over 130,000 miles and no major issues. I have consistently changed the oil NO LESS than every 10,000 miles on this car, to maintain this high level of functionality. I also had to change the spark plugs around the 105,000 mark on the odometer if I remember correctly.

Cars don’t need “tune ups” anymore. That’s a thing of the past. Remember your dad changing his own spark plugs, using a gap-tool, every other oil change? Yeah, no, you don’t do that anymore. I recommend having the garage change the plugs when your car’s instruction book recommends it, and get good quality spark plugs too – there’s a good change they will end up working well for a long, long time.

Remember when you used to be able to get a complete Lube/Oil/Filter change for $15? Those days are long gone. It seems like a basic oil change goes for $25-35 these days. And if you use full synthetic, expect to pay $70-80 minimum at this point in time. At least that’s what I’ve experienced so far this year (2014).

Take care of your car. There’s not a lot you need to do anymore, after 80+ years of the Internal Combustion Engine, they’ve pretty much perfected it at this point. If your car is the type that needs constant repairs and is always costing you unexpected money, I recommend buying a different brand of car. There are different manufacturers with different viewpoints on how to deal with production issues – and sadly, I hate to say it, but American car manufacturers sort of suck at this. You want your car manufacturer to follow a basic tenet that we use in software development — the feedback loop — to detect and remedy any issues that ANY employees detect with the car manufacturing process.

Rather than punishing/squelching comments from employees, you want the employees to be empowered to bring up issues at any time during development, have them taken seriously, and see the changes made to the manufacturing process integrated dynamically so that all future cars benefit from those discoveries and changes. From what I have heard, Toyota, Lexus, and Honda are REALLY good at doing this. I don’t know about the other manufacturers. Let’s hope everyone adopts basic 2000’s knowledge and adopts this feedback-loop principal.

I don’t care how cool the marketing is. Buy a decent quality car. Put your money where your mouth is. Don’t encourage the losers who don’t follow 20-year-old knowledge of how to make the best quality products. Why would you do that? Do what’s right. Encourage the ones who do the best job.

We all benefit that way in the future.

September 13, 2014 / paulio10

Personal Finance Tracking For Financial Happiness

The idea is simple: watch your personal income and add up your expenses to see how much money you’re gaining/losing each month. Are you actually spending more than you’re making? That would be bad. Are you making more than spending, saving the rest for a rainy day? That’s probably good….

…just not so simple. You can easily add up the bills you paid and the things you bought in the past month, and look at your pay stubs to see your income. But if that’s all you do, you’re not seeing everything.


1. Annual / Quarterly / Half-yearly Expenses

Examples: car insurance, property insurance, property taxes (paid on houses that have no mortgage), home warranty, annual fees to services like AAA, Costco/Sam’s Club, your 401K manager, tax preparation costs each year, backup services like Carbonite, magazines you pay for once a year, online software services with annual fees like Nozbe, etc.

For annual costs, divide by 12 – add that to your monthly expenses. Because you effectively need to save up that much money each month, to easily pay for that item when it swings back around again.

Example: the home warranty on your house costs $500 per year. $500 / 12 = $41.67 per month of effective cost. If you’re able to set aside $42 each month, that will completely pay for the $500 bill when it suddenly hits you next year.

In fact, you can create an “escrow” account for yourself, maybe in your savings or money market account, so that you can set aside 1 month’s worth of money from each of these yearly / quarterly / half-yearly bills.  Create a small spreadsheet with all of those type of bills on it, add up the annual amount (with a column-summation), and divide that by 12.  That’s the monthly amount you should set aside every month.

You can even figure out how much to set aside per-paycheck, if that works better for you – most direct-deposit systems let you set aside an automatic dollar amount into a savings account, so you can automate this completely.

Then, when you get one of those special bills, transfer the money from savings to checking – and pay the bill!  Zero stress.

2. Credit cards expenses might get counted twice!

For example, let’s say you buy a toaster with your credit card. You enter the receipt into your expenses spreadsheet at home.  But then, when you pay your credit card payment, you add all of that to your expenses, too!  You’ve counted that toaster twice – just not in the same month.

What’s better to do is to record just the interest that the credit card company charged as an expense. Because that interest is completely new to you, it’s the cost of having a balance on your credit card; it’s an extra amount you’re having to pay the credit card company for the right to use their credit card.  Even if you didn’t pay it this month, you accrued that expense this month, so I’d record it for this month. At least that’s what I do.

3. Using cash can make you count some expenses twice!

Withdrawing cash (and entering that in your expenses), then buying something with that cash (and entering that receipt in your expenses) – you just counted it twice!  Instead, you should pick one of those only, and stick with it. Enter only the moment you withdraw the cash OR the moment you bought something. Not both.

The good thing about entering the cash-withdrawal, and not the thing you buy with the cash, is: you can hide the surprise of a birthday gift better that way. The other family member(s) won’t discover what the present is, because it’s not being listed on a credit card statement or in your expenses spreadsheet. But the bad thing is, you probably had to categorize the money withdrawal as something like “miscellaneous” or “other”, so later when you look at your expenses by category, you won’t know what that money counted as.

If you intentionally don’t enter the cash-withdrawal, instead entering the receipts that you got from spending the cash, that makes better categories – maybe 1 cash withdrawal was partly Groceries, partly Entertainment. It’s easier to tell how the money was used at the end of the month.  But it remove s the element of surprise a little bit if the birthday-person uses the same expense-worksheet that you are. Besides, it’s too easy to not get a receipt when spending cash; then you have no reminder to enter that in your expenses – so you spent money that you didn’t track, which is bad.

My suggestion: avoid using cash as much as possible. That’s what I do.

4. Unexpected Expenses

There are many things that can come up in a person’s life that are unexpected, and cost money.

Car repairs, towing, medical expenses, books for work, fines, fees, lab costs, visiting sick relatives, replacing a broken chair/TV/, etc.

These things are often completely unexpected; but if you live a busy life like most people, you can roughly predict the basic amount of those things that are likely to hit you each and every month. Seems like there’s always something.

It’s tricky though – “my car got a flat tire while driving across the desert between Arizona and California and the spare tire is flat too! It had to be towed 85 miles to the nearest gas station for repair! Heh heh, that surely won’t happen again for a long time!” And you’re right, that won’t happen again next month, next year, or any other year for the rest of your life. But something else will. Next month maybe your pet will have a mysterious illness that the vet can’t seem to diagnose (at great cost to you); then mysteriously heal itself 3 weeks later for unknown reason. The month after, your daughter/son/mother/father/brother/sister calls because they’re in a terrible jam, can they borrow $800 for a couple months?  They promise to pay you back (but you know they probably won’t). The month after that, you might fall and sprain your ankle; that incurs multiple doctor visits, pain killers, and maybe some rehab costs; thank goodness for health insurance; and then you’re fully recuperated 6 months later. And life goes on.

Keep an Emergency Fund

To be ready for the unexpected, I recommend building an emergency fund in your savings or money-market account. Choose a level of cash that you’re going to hold in that account as much as possible. Let’s say you choose $5000.

So long as the account doesn’t have $5000 in it, you will contribute a big chunk from every paycheck to it; say $250 a month, or more if you can. A lot more, hopefully.  This is money you will NOT spend under any conditions – unless you have an emergency.

When the account reaches $5000, happy day!  You don’t have to put anymore in there this month – maybe that’s extra play-money for you this month.  Once an emergency hits you though, and the balance goes down, time to start socking away some of that money every month or every paycheck again.

Saving Psychology

This is an interesting psychological exercise, not just a financial one.  Can you get yourself to do it?  Can you maintain that balance?  You have to think differently about your paycheck from now on.  You can’t immediately spend as much money as you do now. It feels different. You can do it. What you’re actually doing is buying yourself peace of mind. It’s a nice cushion if you’re ever let go from your job, too – that’s an emergency (hopefully that never happens).

Is $5000 enough?  Maybe you need $8000.  Maybe less.  Some wise people say you should maintain 3 to 6 months of your normal expenses – but that could be a LOT of money!  I haven’t been able to save that much myself, I set a target for myself of $8000, and I want to increase it to $10,000 next year.  Right now the balance is down around $5000 for reasons I don’t want to go into.  :)

More Savings Accounts?

By the way you don’t need multiple savings accounts to save for multiple things. You only need one account.

Create a spreadsheet where each column represents one category that you want to save money under. Example categories:

Emergency, Escrow, Vacation, Christmas Presents, Thanksgiving Dinner, Joe’s Birthday, New Laptop

Now, anytime you deposit money into your savings account, put the money amounts in the appropriate columns. Maybe it goes across multiple categories – you just deposited $300 from your paycheck, and you want $100 to go to emergency, $80 vacation, $70 Christmas presents, and $50 to your New Laptop fund (because sometime next year you’d like to buy a new laptop).

Now, when you buy that new laptop next year, you won’t have to charge it to a credit card – you magically have the money waiting for you in your savings account.  You’ll be saving yourself all the interest from not having to pay the Credit Card Company lots of extra money every month for the next few years or so. You’re basically paying monthly payments NOW, before you buy it, instead of after; and you’re paying yourself — nobody can charge you extra to do that. You will have extra cash in the future because you’re not buying into the bullshit of credit cards that our society loves so much. You’re your own credit-card-company this way. Money will feel a little tighter for you now, instead of a LOT tighter later when you have a higher credit card payment. You’re also lowering your personal danger of bankruptcy – by not increasing your debt and monthly payments, from the viewpoint of the credit bureaus.

I’m not saying that credit cards are evil – they serve a purpose. They can be your emergency backup if you ever run out of cash. But most people use them way too often, and pay exorbitant “interest” costs without realizing it. Why should you pay someone else “interest” when you could keep it, and spend that money on ANYTHING ELSE you want to?

What Software Should I Use To Run My Finances?

You don’t have to buy anything – you just need a spreadsheet, and there’s a variety of free spreadsheets today, including Google Drive’s spreadsheet system. You can do this all from your home computer, or possibly even from your cell phone, at this point. You can pay almost all of your bills online these days, including transferring money between bank accounts without having to visit the bank, and even sending money directly to friends & family online.

Congratulations, you’re more financially stable now.

Making Adjustments

With practice, you’ll see if something’s not working. If you constantly run out of money on the 25th of every month when trying to pay your bills, something needs to be adjusted. You have the tools now to find it and fix it. Another annual bill hit you that you forgot about? OK, paying that was painful just now. Dang it. Let’s set this up so it’s never painful again. Add it to your Escrow calculations; how much more do you need to set aside now? Do it. Next year this bill won’t hurt, because the money will be there, unlike this year.

Keep making adjustments as you need to, and the stress points will eventually all be gone.

Not Making Enough Money

If you discover that you’re spending more than you’re making, this is a very dangerous situation to be in – I fear for you. You should be shocked and on high-alert. It’s time to make a change.

The first step is to immediately reduce your expenses. Find what you can trim and shrink, that you’re spending money on every month. Look thru your credit card statements, is there anything that shouldn’t be there? Particularly payments that happen on every statement, like game companies that are charging you for some old game you don’t play anymore. Put a stop to it.

Trim down your expenses, stop the leaks, and then next month, do the same thing again. But you should also consider: can I make more money? Is there another company that will pay me more for doing the same job? Can I get a better job? Don’t get stuck in the rut of thinking your time is only worth so much. It’s a lie. When I was in college I did some computer typesetting for someone at $5/hour, because I thought that was the only thing they’d pay me (minimum wage was around $3.50/hour back then). My friends said I was stupid, I could easily get $15/hour for that work. So the next time someone wanted a book typeset, I was scared, but I said my rate was $15/hour. Without batting an eye, the customer was happy to pay me this higher rate!

Decades later, when running my own computer consulting and web development business, my standard rate was $75-90 per hour; for emergencies, which many customers seemed to have, I charged $125 per hour.

People paid this to me again and again.

For each hour of my work.

There is no limit to how much one hour of your time is worth. You could make $2,000 per hour, if your service is in high enough demand. It’s the same hour, for you, either way.  Especially if you live in the “free world” – there are many ways to increase your income! Find them.

Peace of Mind – Paying Bills Can Be Fun

When you truly understand your expenses, and budget properly for the way your life works, paying bills can actually become fun. I enjoy paying my bills very much. I often pay them as soon as they come in. It feels powerful, because I’m directing energy (money) towards the things that are important in my life. And I’ve set up a system for myself so that when I need the money, it’s there. Either my paycheck pays for it, or my escrow account pays it, or my emergency account pays it. One way or another, the money’s there – I only have to remember to make adjustments in the future (add more or less to my emergency fund as it goes up and down; annual bill changes affect how much I put into my escrow account each month; etc.)


If you want peace of mind with your home finances:

* figure out what you’re truly spending money on every month – don’t forget about annual/quarterly payments; beware of counting certain things twice.

* compare your expenses to your income, make sure you’re not spending more than you’re making! It happens.

* keep some money from every paycheck in your own “emergency fund”, for emergencies only.

* keep some money from every paycheck in your own”escrow account”, to pay those irritating bills that hit you only once a year / quarter / half-year.

Can you control your expenses, and track your income & expenses? I dare you! You can do it.

You will have a more stable & happier life from this.

August 25, 2014 / paulio10

Setting Any Price Partitions Humanity

When you set a price on a product or service, you are immediately partitioning your potential customers into two groups:

A. Those who can afford your product or service

B. Those who cannot afford it

Notice that these two groupings are completely separate from the two groups that are actually important to you:

1. Those who are interested in your product/service and want  it

2. Those who do not want it

You should be selling to those who want what you’re offering. And you shouldn’t waste your time trying to sell to those who do not want it. But the problem is, some of the people who want your service cannot afford it.  At any price.

How Companies Think Today

If you set a higher price, fewer people can afford it.  If you set a lower price, more people can afford it, but you get less money for each one you sell. You can make the most money by finding the “sweet spot” – setting the right price somewhere in the middle.  This divides those who can barely afford it, and those who can totally afford it.

For example, suppose you are manufacturing beautiful purses for women. Maybe it costs $250 to make one purse, and you want to sell the purses for about $500.  You run some statistics and the report comes back – if you sold them for $400, you’d get 1000 buyers. If you sold it for $500, you’d get 850 buyers; and if you sold it for $600 you’d get 300 buyers.  A good business will do the math —

$400 purse X 1000 buyers = $400,000, minus cost ($250 X 1000 = $250,000) or $150,000 profit.

$500 purse X 850 buyers = $425,000, minus cost ($250 X 850 = $212,500) or $212,500 profit     – better!

$600 purse X 300 buyers = $180,000, minus cost ($250 X 300 = $75,000) or $105,000 profit     – not as good.

So the business decision is made to sell them for $500 each – because that maximizes profit for the company.

The Problem This Causes

This doesn’t take into consideration the people who want the purses, but cannot afford them – they are left out now. That is just not acceptable. There are even people who might really need your item, more than other people – to look nice to get a good job, so they can feed their family, so they can take care of their elderly parents, their ailing grand parents; their special-needs child; their family pet that has come down with a serious illness.

Setting a price that maximizes profits has the bad side-effect of blocking many people from having the item, with total disregard to rightness in the world.

There is no right price that doesn’t exclude someone. You can calculate the number of people who would be customers, but cannot be, due to the price that is set. You can figure out the percentage of population you’ve failed to reach. Everybody in our world deserves to experience the product or service that you are producing, not just a few. Not just those that can afford it. Everyone.

How Companies Will Think In The Future

Businesses don’t know how to calculate factors like “individual need”, or “right distribution. So they don’t even bother trying. But these factors really exist, and they must not be ignored – the righteous thing, the compassionate thing, the human thing is to consider who you are leaving behind, and what the consequence of that is. I know that purses may not be vital. But food is vital. Housing is vital. Clothing is vital. Food has a price, and there are some people who cannot afford even enough basic foods to feed their families after paying outrageous medical bills. There are kludgy workarounds for the really poor like food stamps, but that kind of thing should never have to exist; it was not created soon enough when the need first arose; it doesn’t affect exactly the right people; it doesn’t help the slightly less-poor people that are still struggling; it encourages poor people to stay below a certain poverty level so they can keep getting their food stamps; there are many down-sides to a static one-tier solution like food stamps, when you have a rainbow array of people in society. It’s old fashioned and doesn’t solve the problem appropriately. It’s just wrong.

It could be that if you price your purses at $400 each, you’re leaving out 27% of the population from being able to afford one.  That’s a huge failed opportunity to help the under-privileged in our society.  At $500 each, maybe 35% cannot afford one; at $600 each, 55% of the population cannot afford one! All of these are a failure to meet the needs of Humanity, when you’re in the perfect position to do so.

You Are Missing Customers

Partitioning humanity by setting a price (any price at all) goes against nature. And Humanity is part of nature. You’re fighting a force far greater than yourself. My suggestion is, don’t do that.  Don’t fight nature. Cooperate with nature.  This whole system of finite-pricing has to go away some day, to be replaced by a system that more accurately reflects the need of the people whom the company calls customers.

Far more people may be able to use the products and services – and, the company may actually make far more money because of it.  The company won’t be accumulating such horrible karma for causing suffering by many human beings.  If you want something, you can have it.

By cooperating with how things work in nature, companies will be able to heal humanity of may mistaken illnesses we have emotionally and mentally. Feelings of inferiority, racism, separatism, us vs them, “haves” and “have-nots”. All this is ridiculous and needs to go away as soon as possible. But it can’t, it won’t, if companies don’t change how they interact with their customers – how they sell their wares – how they price their items.

There are higher forces in our world that affect all of us whether we believe in them or not. Like Karma. Making something more widely available to people increases your company’s good karma; making it available to fewer people (because you make more money that way) can actually cause bad karma. Because it’s not righteous to partition people into have’s and have-not’s.

People are highly creative. You don’t necessarily know what some inventive people are going to do with your product or service. Watch, and it will amaze you. In fact, some of the most creative people are those who HAVE TO BE, to survive: the poorest people in our society. What will the poorest, most inventive people do with your product? More than you could ever have imagined. Some of the greatest things have been invented and accomplished with creative re-use of things that aren’t normally used for a particular purpose.

Good Examples Today

There are some companies that are experimenting with variations in pricing that more accurately reflect the customer base, and they’re succeeding more than the founders ever expected they would.

1. e-books

2. independent game sites – via Steam, etc.

In the future, nobody will be left out of anything they want, anything they need. In any quantity. Think to yourself how that can come about. Because it can, and it will. You can figure it out now, and be on the cutting edge; or you can wait, and someone else will run with the ball and leave you behind. It’s your choice. The motto of the next generation of our society is: Everything To Everyone.

Stop setting finite prices. Stop partitioning humanity. I know that’s the current model that works today. Come up with a new model, like Amazon and other companies have. Don’t chop off your fingers because you’re keeping your arm.

Start making your products and services available to everyone who wants them, everyone who needs them. Find a way to price your product in a way that works for everyone.

It takes more work, more thought. I know you can do it.

August 14, 2014 / paulio10

Secret Inflation

When a company lowers quality to lower the cost of manufacturing a product, sometimes they release that product as the “new model” at the lowest price of their line of products – and raise the price of the other products.  They can let inflation raise the prices of all their products, and at the same time introduce the new product at the lowest price-point that they’ve had all along. This causes their unsuspecting customers to think nothing much has changed – there’s still a product at the same bottom-line price, and there’s still higher priced models; things are the same, right?

No they’re not the same. The quality has changed.  The lowest item is now lower quality than it used to be; and each item at each tier is lower quality than it used to be. Yes you can pay the same amount of money, and get a similar-looking product, but it’s not as good. Cheaper parts; things don’t fit as well as with the old product; lower quality control; fewer features; shorter life-span; one or more of these things are wrong with it, that didn’t used to be wrong with the low-end product in the past.

If quality is important to you, or at least, if you want to buy a product at the same quality level that you bought your old one 10-20 years ago, you have to PAY MORE by buying a higher-end product, maybe a middle-of-the-line product now, so that the quality matches that of the low-end model from the olden days.  If you used to buy the middle-of-the-line model, now you have to buy the upper-level model and pay a lot more, just to get the same quality level.

This is a non-obvious form of inflation – it tricks the population into slowly becoming lower-and-lower class, poorer-and-poorer, without realizing it. Has anybody else discovered this happening besides me?

An Example

If a fast food outlet has a low-cost hamburger for $3, and they figure out a way to manufacture cheaper hamburgers, they make the new cheaper one $3, and raise their old $3 hamburger to $4, and their old $4 hamburger to $5.

You visit the restaurant. You see there is still a $3 hamburger, so you order it.  And it tastes awful. “This isn’t like the old days! Hamburgers used to taste better in the old days!” you shout, not entirely sure what is wrong with our society. People look at you weird, you’re that old guy complaining that the olden days were so much better… they don’t understand.

You think you are at the same level in society today, but you’re not. You’re poorer. Your income didn’t go up that much in the past few years, did it; and when you buy a $3 hamburger, you’re paying the same price you used to, but you got a lower-quality product. Congratulations, you are living a poorer life. You’ve been duped.

Inflation comes in many forms. One of them is lowering product quality in the low-end products.  To keep your same level of quality of life, you have to pay more money – sometimes a lot more – for the higher-end products, just to “tread water” – to keep the same quality-level of products you are used to. And there’s no clear way to know how to do that. Companies make sure of it.

So NOW how much inflation is there in our society? We already know that inflation is hitting us hard and will for the next few years; and some of us suspect the government is fudging the numbers that they publish a bit. But this, this adds to that even more.  How do we adjust inflation numbers to take this into consideration?  How do we numerify (if I may invent a new word) the concept of “inflation caused by companies lowering the quality and adjusting all prices upwards” ?

I’m sure that our inflation is higher than what’s being reported.



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