Toronto Kelly and I took a short vacation to Toronto, Ontario. I really enjoyed this vacation because we only did the "sort of" touristy stuff. We sort of made an attempt at seeing the CN Tower (tallest building in the world), but it was hazy so we skipped out. Besides that all we did was visit some neighborhoods, shop, eat all kinds of delectable foods, watch a Blue Jays game (7 rows back!!), try to figure out how to get to places (cab, public transportation, walking, driving, etc), and have some yummy IceWine (restaurants sell it for $25-$30 a glass!).






(A street performer from "Buskerfest")
  ¶ 5:12 PM 20 Comments

  Is My House A Bad Investment? Strictly speaking, houses always are. However, despite not making as much money as other investments can make you, you shouldn't convince yourself not to buy a house. Houses certainly provide lots of non-monetary perks. Owning a house can provide feelings of self-worth, accomplishment, or even prestige. Working on projects around your house can provide anything from a time consuming hobby to great stress relief. I could probably go on and on with the pros of home ownership that do not directly translate into $$$, but I'll avoid that for now. The point is, owning a home is considered to be a type of investment that does not return as much as certain other investment types, however, it should return more than you put in to it.

I bought my new Ryan Home in Brunswick Hills to meet a few needs. For one, I felt it was time to stop setting my money aflame by renting. Secondly, I did not want a place that would require many hours of "fix up time". Lastly, a definite consideration was "Will this be a good investment"? I actually specifically avoided certain neighborhoods because the neighborhoods were "well established" or "aging". That usually means that home prices are not increasing as fast as some other area. It was for that reason that we settled in Brunswick Hills...one of the fastest growing cities in northern Ohio. We also bought with the future in mind to some degree. We knew that 4 bedroom houses sell for much more than 3 bedroom houses (so we got the 4th bedroom).

I read this news report and it is making me question the timing of my investment: Existing Home Sales Low. According to the Realtors data, the national median existing home price for all housing types was $230,000 in July, up 0.9 percent from July 2005, the smallest year-on-year price gain since May 1995. The number of homes for sale is increasing by quite a lot. The price of homes is barely increasing, which is not good for existing home owners, but great for those that are looking to buy soon.

The historic home-price gains are 1.5 percentage points above the rate of inflation. Most people ballpark the average rate of inflation to be about 3%, but over the past 20 years it's been a lot closer to 2.6%. Based on those "loose numbers" that puts the average home-price gains at 4.1% per year. The thing to go for would be to get a house that can earn greater than 4.1% per year (obviously). Well established areas (I'll pick Cleveland and Berea as examples) will probably find less than 4.1% on average, while certain other areas will probably see something at or above 4.1%.

Now, if you put two and two together you will notice that the historical average of a 4.1% home-value increase did not match from July 2005 to July 2006 (it only had a 0.9% increase).

So, maybe I won't end up with the "profitable increase" I was planning on...  ¶ 1:49 PM 23 Comments

  My Blogging Is Important? Okay, first of all, I did some checking and various muscle mags and muscle blogs linked to my Guide To Getting Huge (Pt II) articles. Some site called BirdFluBreakingNews.com linked to my Doomsday Predictions article. I can only guess that I'm moving up in the world and I will be getting my most recent article about economic trends (Yuppy Life) or my pointers on eliminating debt in some economics magazine.

The yuppie post definitely struck a nerve in lots of people, as it was my first post to get so many on-topic comments pretty much ever. In fact, the comments themselves nearly deserve their own post.

Here are some key comments:

...tremendous spike in the price of an inelastic good (gasoline) takes place. Individuals are forced to choose luxeries [sic].

I think people buy semi-luxury items because their friends buy semi-luxury items. It has become uncool to be thrifty, or just downright cheap.

What was the person's service worth in real world dollars?

if I were to order $500 worth of food...I wouldn't tip $100 and I wouldn't tip $20

Don't worry Dave I still think you're cheap

if it was true that waitressing was a more lucrative profession in the long-run, you would see more people stick with it rather than going to community/technical college's

I don't even know a Jew who'd have the balls to say that. So let's get this straight. You never ever tip?

If you're stuck in a minimum wage job, you need to suck it up, get some training

The T.I.P.S. (To Insure Proper Service) idea. If you paid money into that and you did NOT get proper service, then the insurance would pay out (most likely paying for your meal).

Minimum wage should at least follow the pattern of inflation

Let the markets set the wages.

I feel the value of college will dwindle vs its cost at some point unless things change

the social norm of a strict percentage of tipping: The more I ponder it the more I think it's a pretty stupid social norm

Look at any country where the "market" sets the wages and you will see that those employees make nothing as employers will use "desperation" to always find someone willing to accept a lower wage.

Obviously many of those points don't follow in a narrative order, but at minimum they presented lots of interesting concepts. The minimum wage arguments and the tipping arguments were my two favorite.  ¶ 10:59 AM 35 Comments

  Yuppie Life During college I minored in Economics because I knew I did not want to major in it, yet somehow I was interested. After taking various courses I find my interest piqued when anomolies or trends pop up in the economic landscape around us. For that reason, and thanks to far more eloquent writers who have penned discerning articles (trading up and rising luxury costs), I have found some trends which seem to directly mirror my own experience and habits. These economic trends actually explain WHY I'm spending like I'm spending.

First off, isn't Godiva Chocolates considered a high-end luxury store? You see, many stores cater their products to the affluent. They look for their niche among the rich because they charge greatly inflated prices for their products. Even Starbucks coffee is supposed to be a high-end commodity. For generations now the poor have shopped at discount retailers and the rich have perused the limited/rare/niche stores that by price simply exclude the non-rich. The "non-rich" in question even includes the masses: the middle class.

However, over the past 10 years a trend disparate to the norm has become evident: the middle class and upper middle class are "trading up". They are picking areas of their lives to live like the upper class. These types of thoughts go into their minds: "I'm a chocolate connoisseur, so it's okay to have Godiva" or "This is my hobby/passion, so I'll just spend a little more on this". The interesting thing is that it sounds perfectly normal to think that way, but it is NOT the way things used to operate.

That type of spending has translated into lower profit margins for Walmart, fast food, etc and huge earnings for the higher end "yuppie" stores. It has become so profitable that many of these "yuppie" stores have built plenty of new stores in very accessible (read: available to the middle class) areas. Now just about anybody can have at least a little bit of luxury in their lives. Some fancy shoes here, a yummy truffle there, a few Frappuccinos here, a nice spa treatment there...

A new trend seems to be starting. Over the past few months the trend is the exact opposite. Starbucks profits are down. Nearly across the board every so-called high-end retailer has come in under their projected earnings...especially during July. Now, we all know that the rich will stay rich and they really won't be hurt badly if the market takes a dip. However, the middle class and upper middle class will be hurt because they are the ones that have already gotten used to trading up and living above their means in a few areas of their lives. The new trend makes it look like the upper middle class is reeling in it's expenditure on luxury items. It's sort of a "You know what, honey? Let's not go out to eat at the Cheesecake Factory and instead just have a little Burger King." Do you know why this is happening? It's because Thorstein Veblen's conspicuous consumption is becoming more and more expensive to partake of (If you are lost that is the guy who came up with the theory that says you buy luxury items to make yourself stand out in a crowd and appear to be wealthy). If you follow the wall street stock index for Starbucks and it's kinsman that target the upper middle class you will see that they have all taken a dip recently. Beyond that, the cost of their items has exceeded inflation. In other words, for every dollar you earn over time you can afford less and less of these luxury items. They are becoming TOO EXPENSIVE for the average person.  ¶ 8:17 AM 55 Comments

  Doomsday Predictions The NY Times (Required registration...) said that "Doomsday can be understated". It brought up the bird flu, the Blackout from 2003, and the virus in the 1930s that killed 30 million people. Thanks to SlashDot user Phat_Tony for his arguments that follow, can "doomsday be understated"?

No it can't.

None of those things listed are even close to Doomsday. They're barely even little blips on the radar screen of history. Out of 6 billion people, the computer virus and the blackout killed how many? These things were moderate inconveniences for thousands, not inescapable death for billions.

Even the flu killed 30 million out of almost 2,000 million, or 1.5%. Yeah, sucks to be them, but killing 1.5% of the population didn't exactly move homo sapiens to the endangered species list.

A modern super-bug could be terrible. No one knows if the worst case scenario is the death of millions or into the billions, but I bet you'll have a hard time finding biologists who think a bug could show up that kills ALL humans. It not only would have to spread like mad, have a long incubation period, be untreatable, and not have any people with any natural immunity, it would also have to be able to get through gas-masks and biohazard suits, infiltrate our best air filters, cross oceans to desert islands people had isolated themselves on (and shoot anyone who tries to get near). And with all that going on, I wouldn't call in understated anymore.

The real Doomsday fears list is pretty short- Nuclear War, Meteor, other improbable astronomical events like supernova. Global warming is NOT a doomsday scenario. It might be a "things are really going to suck" scenario, and I'm not saying we shouldn't be trying to stop it, but it's not going to KILL everybody, it just might make it unbearably hot, ruin crops, cause flooding, worsen natural disasters, etc. But Earth's spent many millions of years being hotter than our global warming forecasts, and life goes on. The real doomsday scenarios ARE NOT understated things that creep up on us- pretty much by definition, little gradual changes are things we adapt too, anticipate, measure, study, and, if they're really getting serous, do something about before we all die. We aren't going to suddenly switch from a negative feedback cycle to an unstoppable positive feedback cycle that destroys everything. If that were in the cards, it would have happened in the past 5 billion years. Our systems (biological and social) are much more robust and stable than that. Realistic doomsday scenarios are big, colossal, horrific events that are anything but understated.

Can you think of very many scenarios that are actual extinction-level events?  ¶ 2:15 PM 13 Comments

  Bigger Than You Can Imagine I bet you I can think of something bigger than whatever you can think of (and your thing can't be God or the Universe). It's probably not THE biggest thing out there, but it's the biggest thing humans have found thus far: Giant Amoeba-Like Blob From Outer Space. It's 200 million light years wide. It actually contains a bunch of galaxies and lots and lots of gas. A light year is the distance light would travel in one year (light is the fastest moving thing we really know about). You could also use "Parsecs", which is 3.3 light years.

Anyway, that blob is mind bogglingly enormous. It reminds me of the not-all-that-uncommon concept that heaven/hell might actually be somewhere out in space. Ridiculous? Maybe. The scary movie Event Horizon basically found an alternate dimension in outer space which turned out to be Hell. It's a remnant of times long ago, but people commonly look up at the skys when they are referring to heaven. It's just like the search for the Garden of Eden or the search for Atlantis. In that same way scientists are searching for the "center of the universe", or the starting point. Since the universe appears to be ever expanding, perhaps it all started expanding from a single point (goes along with the whole Big Bang Theory).

Anyway, there's some side thought that twists that idea around to be that the so-called center of the universe is the physical location of heaven. Do I believe this? Nope. But it's a pretty fun concept to entertain. What if we could find some sort of special location where physics/time behaved differently or some long lost alien civilization. I know it's not out there, but I guess I just like to imagine it could.  ¶ 11:28 AM 8 Comments