67 karma · joined August 9, 2021
If you’re unlevered and have a long time horizon, volatility essentially doesn’t matter. All that matters in the long term is the annual rate of return.
If you’re levered, however, a sufficiently volatile underlying will cause you to get liquidated which sets your return to zero.
However, remember that newer developers get onboarded by older developers. I lead the charge a few years ago to get my then team to adopt Java8 style streams and Vertx, otherwise the stack was the typical SpringBoot annotation affair with the downsides you mention.
In a similar vein, one of Java's touted strengths is the package ecosystem but those packages often are written in the same class-hierarchy-heavy style. When the code you see and use is written in that style, writing in that style becomes the default unless you actively choose to do something else.
Examples are companies like Amazon, Costco, or Walmart where the business model revolves around deepening the value proposition for customers through amortizing costs among greater customer numbers or aggregate buying power.
Insurance would be another example of this business model.
Regarding your first point, I disagree. I think the intention is clearly to provide a direct benefit, but that isn’t always the effect. One example which seems to be entering the zeitgeist now is student aid. The presence of additional student aid has a high correlation with the rise in tuition over time, but I think we’d all struggle to say it was commensurate with to the cost.
Addressing your second point re: social security and perhaps generalizing my first point slightly, I think the statistics you cite are reductions in poverty vs simply abolishing the benefit. I don’t think they measure the counterfactual scenario of there never having been social security to begin with, and those current seniors having had their take home pay increase by some portion of the 15% of their gross pay which otherwise went to SS. Additionally, it doesn’t take into account the future debt servicing cost of current SS recipients on future generations.
As a category I think it’s also generally correct to say they’d argue for not yielding such power to any sort of decision makers, corporate or government, at all. Instead attempting to coordinate empowered individuals through coercive but distinctly non human forces like markets.
Whether the libertarians are correct or not is one thing, but I don’t think they’ve been hypocritical or inconsistent in their motivations.
I got fed this narrative that the corporate environment was ruthless and cutthroat, but I found it highly resistant to even profitable, labor-saving new ideas or practices in favor of ego management, image management, and non disruption.
Maybe it's a false expectation on my part, but I would have at least expected ruthless people to be pragmatic and open minded toward things which may be of benefit. That's not to say they're without fault or downside, but that's certainly not generally characteristic of the corporate environment I've experienced.
OTOH, I've found smaller employers with a more direct connection to market forces much better in this regard. I don't think those two things are unrelated.
My project focuses on the actual deployment of the model artifact and transformation of that artifact into a callable API.
Do you find most offerings low value add because you don’t want to deal with created containers (docker, etc.) (that’s my experience of most offerings in this space)? Is it because you prefer to do that work yourself? Some other reason?
In other words, it _is_ the case that Renaissance works were financed with harder money than works today. That's a historical matter of fact. It _is_ the case that families are breaking down or that nutrient levels in produce (per unit size) have decreased. It's also the case that those events were coincident with a change of greater adoption of fiat currency vs hard currency (and I'd put it on a spectrum because of fractional reserve banking and other items which made the Gold standard dollars not _really_ redeemable in Gold and etc).
With all that said, the "sounds crazy" comes in because it's totally unsubstantiated in the quote (and probably otherwise) that just because these things occurred together the change in the status of money is the primary driver behind the other changes.
Edit: For example, if the change in money is the primary driver, then it is the case that the massive technology shifts we've seen aren't the primary driver. Nitrogen based fertilizers aren't the primary driver. Various civil rights movements aren't the primary driver. The presence of global travel, the formation of a global village, the new ability to communicate, none of these are the primary drivers.
And the more you lean on fiat money being the explainer, the less you allow all these other things to contribute to the explanation. That case becomes harder and harder to support, I think.
Tl;Dr: The body has two basic metabolic systems, glucose oxidation and fat oxidation. Fat oxidation can be trained to be more powerful (as in wattage of output) through high volume, low intensity exercise. Clinicians have observed higher insulin sensitivity in patients who undergo this training, as their bodies simply use their blood glucose system less and thus use insulin less day to day.
Here’s a link to the paper [pdf]: https://sci.bban.top/pdf/10.1007/s40279-017-0751-x.pdf
And here’s a link to a (several hour) podcast between the author and a clinician talking about the results. It also has time stamps to sections about diabetics. https://peterattiamd.com/inigosanmillan/
I’m not affiliated with the paper, author, or podcast in any way. I just came across this research and my dad’s diabetic so I was motivated to learn more.
This has a <1 correlation with wealth (richness) and poverty.
You can control a lot of assets with relatively low income via debt (the interest of which doesn’t isn’t taxed, frequently), and can have relatively few assets with high income (a sports player, for example, in part because their careers have intrinsically low shelf lives due to physical requirements).
Related to that last point, progressive income taxes also charge people differential tax burdens based on the “density” of their earnings, even if they have the same lifetime earnings. (Compare a football player who makes all his money from 20-25 to a surgeon who makes the same amount of money from 30-65. Because the football player makes more money per year, he’ll pay higher taxes than the surgeon even if they make the same overall income. This is despite the fact there is 0 ability of the football player to maintain his income at 65.)
The above poster would probably view capital gains tax increases as also doing the same thing. Additionally, these policies are often paired with other social spending (like Cal’s phase-out of asset tests for Medicaid, that privilege the older, asset owning strata at the cost of younger, income rich but asset poor strata).
LVT, wealth taxes, or even sales taxes do not have these features and, perhaps coincidentally perhaps not, have been beyond the pale politically for a century.
> Market is a fine fit for every healthcare need that doesn't start with a trip to the ER which is the overwhelming majority of healthcare dispensed in the US.
I think most people are interpreting this as “market is a fine fit for every healthcare need [except for those that start in the ER] which is the overwhelming majority...”
I.e. that you’re advocating the market for the majority of healthcare rather than the majority.
I think your actual recommendation is the opposite. Maybe this would be clearer if you just laid it out like, “Most healthcare is non emergency, cost is a primary concern which insurance makes worse, markets are good at solving cost issues.”
Responding to your actual argument, however, I see many people claim that insurance companies are taking a “fat cut”, but I see very little evidence of higher than expected ROI/ROE in Aetna / United / etc. (ref: United’s net margin is ~5%, ~15B in net income on 300B of revenue). ROE is ~20% which doesn’t seem ridiculous for an insurance business.
The bigger problem seems to be personnel spending in healthcare (admin, support staff, billing), and generally a systemic culture that’s not even knowledgeable about what prices they charge, let alone price conscious in the services they deliver.
Haven’t most such places seen increases in wealth inequality and, perhaps more importantly, increasingly unaffordable rent / housing? Not to mention inflation which was probably not at a sustainable pace?
This isn’t even a bait question, perhaps you attribute those results to some other cause or don’t view them as problems. I haven’t heard this POV in my own circles.
The premium for short-dated puts gives you some bounds about which the options market thinks the underlying will move, and I’ve been able to improve my entries in effected issues by 5-8% in terms of price (before fees for options).
It’s effectively a limit order that you can’t cancel, with potential upside if the puts expire worthless.
Sources:
http://edr.state.fl.us/content/population-demographics/data/... https://www.health.ny.gov/statistics/vital_statistics/2016/t...
Methodology: Took the Florida 2010 and estimated 2020 numbers and averaged them together to get a "2015" estimate, then compared it to the 2016 NY data.
If you save 35k per year and have living expenses of 25k per year (60k - 35k = 25k), then you have a 58.3% savings rate (net of taxes). My math has you FI in 14 years assuming a 5% return net of inflation, or 13 years with a 7% return net of inflation.
If you can augment that 35k per year savings by working part time it can be even faster. Assuming the same implied hourly rate at 120k per year ($60/hr), and an extra 20 hr/wk of work, AND a 50% tax rate, that yields an extra 30k per year of savings.
That would bump the savings rate to 72.2%, which would drop the estimated time to retire to 9 at a 5% return net of inflation or 8 years at a 7% return net of inflation instead of 14 or 13 years. Thus saving 5 years.
At a 20% rate of return net of inflation, just for example, the 8 or 9 year time would drop to 6 years, so the yield on your investments probably isn't going to be a primary driver of the time until retirement. Savings rate is a much bigger driver.
One reply to that is to use different methodologies
The canonical reply is probably something on the order of “people can’t sustainably engage in practices where they exchange $1 of value for $0.50 of value, as they still need to exchange labor for food and other real goods.”
You normally see the latter play out through credit crises, where the benefits of some activity fail to materialize and therefore loans can’t be repaid, and a lot of pain follows.
Under that view instantaneous measures of GDP don’t mean much, but measurements averaged over longer periods, credit crises, etc. take on some meaning.
You do need a common measurement to be able to aggregate items together (a tractor and a sandwich, for example), and we generally use dollars for that, but I wouldn’t call that recursive.
You could also measure it in labor time, percentage of life people need to spend working, sea shells, or a variety of other measures depending on your aim.
So I can't precisely say I'm part of this group, but I'm definitely associated with it. My parents divorced early, and living with one, for several years, involved food insecurity while living with the other involved being at the 90th percentile of HH income (though not wealth).
I'm now on my own, and while I wouldn't say I've 'figured it out', I'm in a position where if I never saved another dollar I'd at least be able to retire by 40.
I've seen three broad categories of children who end up successful with money. In order of pain of childhood:
1. Children of parents who are successful, who then replicate the model their parents used. This is a buddy of mine who is a doctor because his dad is a doctor and he liked what he saw growing up.
2. Children of parents who are successful to a limited point, and instill in their child the need to adopt a better model to live a better life. This is the child-of-immigrants experience that you allude to. I had a friend in college, for example, who's dad paid for her tuition but hadn't seen a dentist in 20 years. His basic message to her was: "You can work 60 hours a week like I do, and this is the best you can get. If you want to do better then do well in school."
3. Children whose parent or parents are destructively unsuccessful: addicts, criminals, etc. In this case the operative thinking is "I'll do anything to avoid this outcome". I'd predominately put myself in this category.
I'd guess that if you polled most successful people, they'd predominately come from 2 or 3 rather than 1. And I think this effect occurs because a life spent following the path of least resistance (at least in an American context) seems to end poorly for most people. Divorce is common, and financially most people don't end up with enough money to support themselves in old age (and Social Security is of dubious ability to continue to do so).
As a result, when you're looking for successful people you're looking for people who have been catalyzed out of the "normal path" or path of least resistance. Sometimes it's the presence of an obviously better alternative as in (1), but most of the time it's a really painful association with the normal path as in (2) or (3), which then motivates them to seek out something different.
But if you’re implying from it that benefits programs don’t matter because the payroll taxes pay for them, that’s not correct.
In 2020, the cost of the programs I mentioned above was approximately 2.3 trillion dollars. Payroll tax revenue was 1.3 trillion, income tax revenue was about 1.6, everything else is half a trillion.
So if you waved a magic wand and poofed these programs out of the budget, you could get rid of the payroll taxes and 2/3 of the receipts of the income tax without changing the deficit. Or, you could get rid of payroll taxes, all the other taxes, and still reduce the income tax receipts by about 1/3.
> People paid into social security and medicare to get it. If they get more than they paid in for (sans interest earned on what they put in), then you have a case for a "wealth transfer". Otherwise, it is just like a 401K, which is also save now and use later.
The problem with this line of argumentation is that people have gotten (and are promised to get) more out of these programs than they pay in.
The CBO provides projections for the solvency of the assets of these programs, which it calls trust funds [1]. The projections show the bulk insolvent by 2026. So clearly people are receiving more than their contributions are capable of sustaining.
The federal government publishes its spending data[1], and that is simply not what the money is spent on.
Transportation in totality was 7% of discretionary spending, itself 24% of total spending in 2019 [1].
2020 was an unusual year with enhanced unemployment and the paycheck protection program, but depending on whether you want to count the interest on debt, 35% to 40% of federal spending was on Medicaid, Social Security, and Medicare, the latter net of premiums (so gross spending was higher).
In 2018, a more normal year, these categories represented 55% of spending, interest being 8%.
In short, most federal tax dollars represent a redistribution of income from the young and working to the old, nonworking population. That’s what the plurality of the dollars do. Whether or not that’s a “good” thing is outside the scope of this comment, but we should at least be able to be honest about it.
[1]: https://en.wikipedia.org/wiki/Government_spending_in_the_Uni...
On the emotional management / discipline front, I’d suggest also exploiting the similarities between personal finances and healthy living. If money is particularly painful for you, try forming simple habits like going on a 10 minute walk each morning, or eating healthy 1 day a week.
Small actions like that will help you prove to yourself that you can make changes, and you can ride that proof emotionally to make bigger changes incrementally over time.
An example would be 1 day a week of not eating out, which becomes a $10 per week saving habit, then moving to 2 days and $20.
In some sense this is a form of self-insurance rather than paying a “premium” in opportunity cost to the bank each month / year.
Also: I know recommending options to novice investors is considered heresy, but in my experience 1 year puts insuring 50 or even 70% of market value via strike price are often considerably less costly than a 6-8% assumed annual opportunity cost between SPX and some 0/1% saving’s account.
Something that’s automated like this could easily just buy puts with a 1 year window on deposit and paired sell them with equities on withdrawal.
I don’t know why nay-sayers are freaking out about this aside from calling it a checking account. Most HSAs (like Health Equity which I use) have a threshold cash balance (say $500), and then allow you to invest the rest, even in equities. No one seems to yell at them for being irresponsible because a medical emergency may coincide with a market downturn.
Maybe this is inappropriate for a Launch HN, but do you see a path to profitability for this that isn’t based on selling advertising / marketing data? Is there sufficient income or a sufficiently large addressable market here to make this work on just cash management / tax planning?