Archive for the ‘Uncategorized’ Category

Vastly different contractor pricing again

Thursday, August 25th, 2016

I have to replace a 32 3/8 x 54 5/8 x 3/8 pane of tempered glass in my shower. The Glass Guru quoted me $467.08. The Glass Doctor quoted $800 even.

As I wrote about in http://www.rakkar.org/blog/?p=619 I’m really surprised at the range of prices when getting quotes. You’d think that since material and labor costs are similar, prices would be comparable between competing companies. With car shopping you don’t see one dealership sell a car for $46,700 and another dealership across the street sell that same car for $80,000 but that is essentially what is happening here.

Retiring early despite inflation

Thursday, July 21st, 2016

Suppose I want to retire early with an income of $100,000 a year after federal tax. Because I’m retiring early, I want to live on my returns only, without touching the principal. In order to do that, my investments need to make $128K a year, as approximately $28K will go to tax. Divide $128K by the rate of return of an investment, and that is how much you need invested.

That would be the whole story were it not for inflation. I once heard Ron Paul say inflation is an underhanded tax, and I agree because it is hidden double tax. For example, if inflation is at 4% and an investment gives me 4%, I would be losing money because I still have to pay tax on the 4%; I would end up with 2% to 3%. Stating that numerically, an investment of $100 would be $104 after a year, but I am taxed on the $4 gain regardless of inflation. I end up with $102. That $102 can only buy 96% of what it could the prior year, so it’s the same purchasing power as $97.92. I would have been better off just spending the money.

The market as a means of retirement:
Officially, inflation is currently at 1%, but according to Shadow Stats it is 5% or 9% depending on what metric you use. Even believing the government’s metric, inflation was as high as 5.6% in July of 2008, with an average of 3.22% . It depends on your tax bracket, but an investment that returns less than 5% is probably losing you money after taxes and inflation. Even if you get a tax-exempt investment such as municipal bonds, you still have to subtract 3.22% to get your adjusted rate of return. VWAHX has a 5.43 10 year rate of return, subtracting 3.22% gives a inflation adjusted yield of 2.21%. Using this investment, I need $4,524,887 to hit my $100,000 yearly income goal. While one can invest in higher-yield returns, they carry more risk that those retiring do not want to be exposed to.

Home ownership as a means of retirement:
My prior house, which I am now renting out, returns rental income of about 4% after expenses. Because the house appreciates with and the rent prices are fundamentally based on real inflation, that 4% is exclusive of inflation. Since I am taxed on this income, I need to make $128K a year at 4%, which works out to $3,200,000 were I to try to live solely off rental income.

Higher-yield stocks and diversification
Despite home ownership being a better investment, in cities with a heavy tech industry there are signs of a housing bubble. Housing prices are about double what they should be for the incomes in those areas, driven by shadow demand from investors. With the last housing bubble “the S&P 500 declined 57% from its high in October 2007 of 1576 to its low in March 2009 of 676” according to http://www.investopedia.com/features/crashes/crashes9.asp

If true, the best thing to do now is to hold investments that are not affected by a housing or stock market bubble. Wait for the bubble to pop, then when prices are normal invest in VFINX . Portfolio managers will not recommend this stock because they cannot make a profit from it: you have to buy it directly from Vanguard. However, it is the best investment due to its low expense ratio and 10.80% return.

Using a long-term 10.80% rate of return, then subtracting 3.22% for inflation, yields an average real return of 7.58%. I need to invest $1,688,654 to retire in this case (actually it’s even better than that because capital gains is lower than income tax).

While VFINX is clearly the most obtainable choice, the best strategy is to diversify with a combination of a high-yield fund and property ownership. The high-yield fund is sensitive to inflation and won’t return consistently, but over the long run is a higher-yield investment. Home ownership is resistant to inflation and will be more consistent.

Uber driver makes $12.91 an hour

Thursday, May 26th, 2016

I met a very friendly and open Uber driver recently who shared with me his financial situation working with the company.

He bought a Toyota Prius for $30K, specifically to work with Uber
In one year he put 48,000 miles on it
He makes about $1 a mile after Uber’s fee and works 10 hours a day
He spends $60 a week on gas
He has to change the oil every two months
It costs about $4000 to replace the hybrid battery, and this needs to be done about once a year at the rate he is driving
He expects the car to last 4 years.

Assuming he is right about the car lasting 4 years (which I doubt) it would work out as

— Over 4 years —
Income:
$192,000

Expenses:
$12,480 gas
$1,200 oil change at $50 each time
$12,000 for three batteries (first one comes with the car)
$30,000 the car itself
$2,000 in tires, $500 for 4 tires once a year
Total: $57,680 assuming no other major costs

Pre-tax income per year, after expenses: $33,580. At 50 hours a week, AT BEST this works out to be $12.91 an hour. More likely the car will break down sooner past where it is worthwhile to repair. It also assumes no vacations over 4 years, and does not include health care.

The driver was complaining about his old job only paying $35,000 a year. But actually he was making more before AND that included vacations and health care.

In Uber’s defense, the driver loves being his own boss, and that is certainly a great thing.

Why is the CA drought not taken more seriously?

Tuesday, March 1st, 2016

According to Reveal News “[groundwater] now accounts for about 60% of California’s water supply. But unlike its rivers, lakes and reservoirs, the state does not consider groundwater part of the public good. It does not regulate groundwater like it does surface water. Landowners can pump as much water as they want.”

PBS Newshour does a better job of explaining this including a link to an op-ed on LA Times by Jay Famiglietti, a Hydrologist and UC Irvine and a water scientist. Written March 12, 2015 “Right now the state has only about one year of water supply left in its reservoirs, and our strategic backup supply, groundwater, is rapidly disappearing.”

We use four times as much water for agriculture as urban use, 80% of the state’s water According to Water used to make various crops it takes 13.8 gallons to make ONE orange, 5.4 gallons to make one head of broccoli, 1.1 gallons of water to make one almond, and so on. Yet Why aren’t farmers being forced to cut back?

Undisputed facts:

  1. We use more water than we take in through rainfall and imports, and this comes from groundwater
  2. Groundwater is limited and California Has No Idea How Much Water It Has Left

It’s like if you spent $100,000 a year, of which $60,000 a year was from your savings account while you have no idea what your remaining balance is.

Groundwater running out would be a worldwide disaster as CA is the 8th largest world economy.  Home values would plummet as areas of the state become uninhabitable. Businesses would have to move or go out of business, causing unemployment and a further drop to home values. Agriculture would be devastated, leading to further job loss and rising food prices.

It’s worth practically any effort to avoid the groundwater running out. We should cut back on golf courses first, which “an average 18-hole course uses 90 million gallons of water each year.” We should migrate away from high water use agriculture, especially the most egregious usages such as oranges and almonds. Farms should not be located in regions that do not get enough rainfall to sustain them, especially deserts.

Online grocery shopping comparison

Sunday, January 31st, 2016

https://www.spud.com/
Price: Looks to be about 150% typical from a quick browse-through. Otherwise no delivery charge, no contracts.
Delivery speed: Only delivered on a set day
Selection: Very limited. They carry the most common items, but you’ll still need to go to the grocery store.
Delivery areas: Very limited, certain major cities

https://www.helloenvoy.com/howitworks
Price: Cheapest plan is $10 a month + a 10% surcharge on the groceries. According to the site tipping is not expected, but some clients do tip.
Delivery speed: Two hour service window selected on signup. I don’t believe this is delivery on demand.
Selection: Trader joes and whole foods only
Delivery areas: 7 states, limited cities

https://www.instacart.com/
Price: Depends on the store, 15% markup for some stores. $6-$12 delivery fee, or $149 a year unlimited. Tips are expected.
Delivery speed: 1 hour
Selection: Whole foods, costco, safeway, QFC, PCC, petco, Central co-op
Delivery areas: Certain major cities

https://shop.safeway.com/ecom/home
Price: $49 minimum order. $10 delivery fee on order of $150 or more. $13 delivery fee on order under $150. No tipping. Safeway prices which are higher than Trader Joes, Costco, but cheaper than Whole Foods.
Delivery speed: 1-4 hour window for same-day most days
Selection: Safeway only. No hot foods.
Delivery areas: Certain major cities, covers my city though so better than most

https://fresh.amazon.com/Gateway
Price: $299 a year plus $79 a year for Amazon Prime membership. Delivery free on orders over $35. Items prices are comparable to Safeway. Tip expected.
Delivery speed: Same day
Selection: Good, however the CNET review said the tomatoes that were delivered were mushy.
Delivery areas: Certain major cities, covers my city though so better than most

Seattle contractor prices are all across the board

Wednesday, October 7th, 2015

I just bought a 1.12 million dollar house in Seattle and was looking for work to be done. Its crazy how much prices can differ from one contractor to the next. And how expensive some companies are. I think some people take a look at the house I got and get the idea I will pay any amount they can dream up.

Install L6-30R plug for car charger, 5 feet from the electrical panel.
Estimate 1: $750
Estimate 2: $4000
Estimate 3: $350

Install 3 electrical outlets, one in each upstairs bathroom
Estimate 1: $1500
Estimate 2: $500

Sand and refinish 10×10 section of floor
Estimate 1: $1000
This should be like $3 a square foot.

Refinish cabinets, stain sun faded cabinets:
Estimate 1: $8000

Painting, 3 rooms
Estimate 1: $650, I bought my own paint

LASIK

Monday, May 11th, 2015

I got LASIK this Saturday. It was $3000 per eye but I paid half of that because of insurance and a discount. They gave me an equivalent to Xanax which took the edge off but the process was still moderately scary. First they put a ring on my eye. They used Intralase to cut a flap. The doctor lifted up the flap with a metal tool, moved me to another machine, and the other machine removed about 10% of my retinal tissue over 20 seconds. The doctor then put the flap back down and smoothed it. I did not feel pain exactly, but I had discomfort until the painkiller took effect the same as if you touched your own eye.

The actual operation took maybe 10 minutes. But the whole procedure was 2 hours with the waiting and paperwork.

The doctor told me I had a scratch on my right eye, so the first day my right eye had a moderate amount of pain. I could see right away but things were blurry, for example I couldn’t completely read my phone to text my ride. A lot of the blur was from my eyes watering. I went to sleep right away and after waking up 50% of the pain was gone.

The next day I had no pain. I had and still have a halo effect. It’s pretty much like what you would see in a game if they wanted light to halo around a bright window. The brighter the light and the darker the surrounding area the more noticeable the halo is.

I’m going to an eye doctor tonight for a followup. But just from looking around my vision is good enough I don’t need glasses, but still not as good as when I wore glasses. My near vision is also not as good as it used to be. Where I could easily see fine details of fingerprints now I have to struggle to do so. Over the next week my vision is supposed to improve so I’ll know the final result then.

Titan X price comparison from 4 PC builders

Sunday, May 3rd, 2015

I am buying gaming PC with an Intel Core i7 5930, a Titan X video card, 32 GB of RAM, Windows 7, noise reduction, and a 512 GB SSD harddrive. I priced out this system from 4 different builders to find the best deal that matched the configuration I wanted.

I ended up buying from iBUYPOWER for $3783. Not only were they the cheapest, they offered the fastest build time. The runner-up was AVA Direct, and while I bought from them before I didn’t feel confident with their system builder because there was not enough information on each part. I felt like I could easily make a system that did not work, or did not work well. Alienware and Velocity Micro were both about $1000 more expensive, neither offered noise reduction, and both had long build times.

http://www.ibuypower.com/: Gamer Intel X99 Special – $3783

  • Case 1 x NZXT Phantom 240 Gaming Case – White
  • iBUYPOWER Labs – Noise Reduction 1 x Advanced – iBUYPOWER Harmony SRS Sound Reduction System – Improved Airflow Silent Fans
  • Processor 1 x Intel® Core™ i7 5930K Processor (6x 3.50GHz/15MB L3 Cache) – Intel Core™ i7 5930K
  • Processor Cooling 1 x AVC K7127N Liquid CPU Cooling System (Copper plate for best cooling performance) – ARC Dual Silent High Performance Fan Upgrade (Push-Pull Airflow)
  • Memory 1 x 32 GB [8 GB x4] DDR4-2400 Memory Module – Corsair or Major Brand
  • Video Card 1 x NVIDIA GeForce GTX Titan X – 12GB – FREE Upgrade to GTX Titan X EVGA Superclocked – Single Card
  • Free Stuff 1 x [FREE Game Bundle] – CSGO, Final Fantasy XIV, GRID, World of Tanks, and LEGO Minifigures Online
  • Free Stuff 1 x [FREE] – iBUYPOWER High Performance Gaming Mouse Pad – FREE with any System ($29 Value)
  • Free Stuff 1 x [FREE] – Tt eSPORTS Cronos Gaming Headset
  • Free Stuff 1 x [FREE] – 802.11AC Wireless Dual Band Module
  • Free Stuff 1 x [FREE Game Download] – Witcher 3 – free w/ NVIDIA GeForce GTX 960, 970, 980 or 970M and above notebook
  • Motherboard 1 x MSI X99S MPOWER — 4x PCIe x16, 8x USB 3.0, 2x USB 2.0
  • Power Supply 1 x 1200 Watt – Corsair AX1200i – 80 PLUS Platinum Full Modular
  • Primary Hard Drive 1 x 500 GB Samsung 850 EVO SSD — Read: 540MB/s, Write: 520MB/s – Single Drive
  • Optical Drive 1 x LG 16x Blu-ray Re-Writer, DVD±R/±RW Burner Combo Drive – Black
  • Sound Card 1 x 3D Premium Surround Sound Onboard
  • Network Card 1 x Onboard LAN Network (Gb or 10/100)
  • Operating System 1 x Microsoft Windows 7 Professional + Office Starter 2010 (Includes basic versions of Word and Excel) – 64-bit
  • Additional Software 1 x NZXT CAM – Hardware Monitor Software – Preinstalled on your PC
  • Keyboard 1 x iBUYPOWER Standard Gaming Keyboard
  • Advanced Build Options 1 x Tuniq TX-2 High Performance Thermal Compound – The best interface between your CPU and the heatsinks
  • Warranty 1 x 3 Year Standard Warranty Service

Build time: 12 days, however for $109 I can pay for next-business day rush shipping, which would reduce it to 3 days.
(Update) Their next-business day rush shipping is misleading. It only applies after they gather the parts, which itself takes one or more days. In my case they were out of the CPU, so after a week I changed the CPU to get the order started.

http://www.velocitymicro.com/: Raptor™ Signature Edition – $4754

  • OPC Black – Velocity Micro Ultra Performance Aluminum Chassis
  • 1000 Watt EVGA SuperNOVA Power Supply
  • Gigabyte X99-Gaming 5 Intel X99 Chipset, ATX Motherboard
  • Intel Core i7 5930 Processor
  • Velocity Micro LiquiCool 6 Fluid Cooling System
  • IC Diamond Thermal Interface Material
  • 32 GB Crucial Ballistix DDR4-2400
  • 12GB EVGA NVIDIA GeForce GTX Titan X
  • 500GB Crucial MX200 SSD 555 MBps Read/500MBps Write

Noise reduction not available.
Build time: 20 days from when I specced the system.

http://www.alienware.com/: Alienware Area-51 – $4820

  • Intel® Core™ i7-5930K Processor (6-cores, 15MB Cache, Overclocked up to 3.9 GHz w/ Turbo Boost)
  • Windows® 7 Professional, 64Bit, English
  • NVIDIA® GeForce® GTX™ TITAN X with 12GB GDDR5
  • 32GB Quad Channel DDR4 at 2133MHz (No option for 2400MHz)
  • 512GB SSD 6Gb/s Main + 4TB 5400RPM SATA 6Gb/s Storage (No option for SSD only)
  • Slot-Loading Dual Layer Blu-ray Disc™ Reader (BD-ROM, DVD±RW, CD-RW)
  • Alienware™ 1500 Watt Multi-GPU Approved Power Supply (Lower power not available)

Noise reduction not available
Build time: 1 month.

http://www.avadirect.com/: Core™ i7 Extreme X99-chipset 2-way SLI® / CrossFireX™ Custom Gaming Desktop – $3830.65

  • Phantom 630 White Full Tower Case w/ Window, EATX/XL-ATX, 9 slots, No PSU, Steel/Plastic
  • X99S SLI Krait Edition LGA 2011-v3 Intel X99 10 x SATA 6Gb/s ports (2x ports reserved for SATA Express port)* – SATA1~6 support RAID 0, RAID 1, RAID 5 and RAID 10 – SATA7~10 ports only support IDE
  • Core™ i7-5930K Six-Core, 3.5 – 4.0 GHz TB, LGA2011-3, 15MB L3 Cache, DDR4-2133, EM64T EIST HT VT-x XD, 22nm, 140W, Retail
  • AX1200i Digital ATX 1200W Power Supply w/ Modular Cables, 80 PLUS® Platinum, 24-pin ATX12V v2.31 2x EPS12V 2.92, Multi-GPU Ready
  • 32GB (4 x 8GB) HyperX Fury Black PC4-19200 DDR4 2400MHz CL15 1.2V SDRAM DIMM, Non-ECC
  • Nepton 240M Liquid Cooling System, Socket 2011-3 / 2011 / 1150 / 1155 / 1156 / 1366 / 775 / FM2+ / FM2 / AM3+ / AM3 / AM2, Retail
  • PH-TC12DX Red CPU Cooler, 2x 120mm Fans, Socket 2011 / 1150 / 1155 / 1156 / 1366 / 775 / FM2 / FM1 / FM1 / AM3+ / AM3 / AM3+ / AM2, 157mm Height, Copper/Aluminum/Nickel Plated
  • Formula 7 Nano Diamond Thermal Compound
  • 500GB 850 EVO SSD, Samsung MGX, 3D V-NAND, 540/520 MB/s, SATA 6 Gb/s, 2.5-Inch 7mm, Retail
  • 2TB Barracuda®, SATA 6 Gb/s, 7200 RPM, 64MB cache
  • WH14NS40 Black 14x/16x/48x BD/DVD/CD Blu-ray Disc™ Burner, M-Disc, SATA, OEM
  • GeForce® GTX TITAN X 1000-1075MHz, 12GB GDDR5 7010MHz Graphics Card
  • Universal Acoustic Foam
  • Standard Wiring with Precision Cable Routing and Tie-Down
  • Windows 7 Professional 64-bit Edition w/ SP1, OEM w/ Media
  • Silver Warranty Package (3 Year Limited Parts, 3 Year Labor Warranty & LIFETIME Technical Support)

Note: This is less accurate because AVA Direct only provides terse text descriptions for each part as opposed to full-detail specifications.
Build time: “Orders that require assembly: 7 to 14 business days for regular systems, 2-4 weeks for systems with special customization options.”

Elite dangerous: Great mechanics but little content

Wednesday, February 4th, 2015

I quit a lot of games early with plenty of unplayed content because the core mechanics suck. The game may be unbalanced, or the UI has flaw(s) I can’t get over, or the player may be punished for things that were not their fault. Elite Dangerous is unusual in that it has the opposite problem: great mechanics, but very shallow content?

In terms of mechanics, Elite Dangerous has the best controls I’ve ever seen in a space fighter game. The level of remapping is overwhelming at first but somehow all works together to support any way you want to play. The user interface is crazy complex for a game, yet provides almost all the information you need when you need it. The galaxy interface, at first sight, blew me away with how much information there was.

But as I said earlier, where’s the content? A computer cannot generate new or meaningful content; it can only randomly do the same thing different ways. So once I’ve killed X pirate ships I’ve killed all of them. Once I’ve seen a few galaxies, I’ve seen them all. Once I’ve visited the 4 or 5 different types of space stations, they are no longer interesting to look at. Like someone on Reddit said, the content is a mile wide but an inch deep.

While you can see other players fly around in a system they might as well be AI controlled. Besides rare text chat and trying to attack someone for no reward you have no interaction with other players. You cannot fly together, you cannot fight together, and even if you could you wouldn’t want to because there are no challenges that require this or systems in place to support doing so.

Just off the top of my head things that are missing:
Unique content, besides giving a few planets (such as Earth) a special texture
Quest progression. All missions are one-shot, at most giving you the choice between supporting one of two identical factions.
Meaningful interaction with other players
In-depth reward system. There’s no unique or special loot.
Crafting
Meaningful differentiation between factions
Meaningful impact of rank and reputation
Capital ships
Planets and stars are just obstacles
Large scale combat

The launch trailer is actually a lie, as you can’t do the important things it shows, including large scale combat, working with other ships, multiplayer, or capital ships. Maybe they should have spent that money on level designers instead.

The nanny from hell

Saturday, February 8th, 2014

At the start of 2014 I was looking for a nanny. One nanny replied to my job ad
“My required salary is $15 an hour”
then replied immediately after
“My required salary is $20 an hour”

My gut told me “Do not reply to this person” but I ignored it. On the phone, she said that she now wanted $16 an hour. In person, $18 an hour. Two weeks later, after she had already been hired, she told me she made a mistake in her math and for the hours I was giving she required $20 an hour. At the time my wife was dying, the alternate person I was going to hire was also $20 an hour, and she was very nice to my son. So I just gave her the raise.

Two weeks later, she lost my son. I get a call from the neighbor that my son was at his house, and “Did you send him here?” I had not – the nanny was upstairs getting his jacket and my son ran out of the house. I do not blame her for that. What I do blame her for is after I retrieve my son, we are all in the front yard and I walk into the house. Instead of watching him automatically as I expected, the nanny followed me into the house. After a few moments inside the house I asked her “Why are you following me? Where is my son?” I go outside and he is nowhere to be seen. Rather than helping look or call out to him, the nanny is standing there on my porch like a deer in the headlights. A lady at the end of the street waved me down and told me “There’s a kid running around in the street over here. Is he yours?”

That night I call the nanny to fire her. She knows where my son goes to school, where I live, etc. so rather than tell her the truth I tell her I just have decided to watch my son by myself from now on, and I will pay her two weeks severance even though I do not have to. She calls me back with a 20 minute sob story about how she has 3 kids to raise, and turned down another job to take mine, and how she is being punished for doing the right thing. So for perhaps the first time in my life I relent after making a decision.

We have a big fight the next day, partly because she was mad I sent her home early that day. She didn’t want to leave because she wanted her hours. I basically kicked her out of the house. I explain to her I was mad that she lost my son. Rather than accepting responsibility, she blames me. She said my son does not listen to her when I am home, which means that I am watching him instead of her, meaning that if I walk into the house and leave him outside with her it’s still my fault if he runs away. She claims the fact that he ran away in front of her was not a fact, but my opinion.

A few days later I have to take my son to urgent care and tell her to come in a couple of hours later. Again the nanny raises a scene, demanding pay for the missing hours. I refuse, but offer to let her clean the floor if she would like work those hours. She refuses to do that, and does not come in that day.

I was already so angry with her that I could not look her in the eye when she was home. Another few days later the nanny asks for her second raise.
1. Change from hourly to salary so that she basically starts getting paid for the time she does not work
2. Plus 5 Paid vacation days each year
3. Plus 3 Paid holidays each year

We discuss it a few days. From the first day she considered it a done-deal and in fact started leaving early assuming she would get paid for that time. But when she asks me to start pay part of her gas to get to the job site, I reach the limit of my patience. I reply with an angry email. I give her notice. For the sake of her 3 kids, and also to try to forestall revenge on me through my son, I offer to pay her out through March if she doesn’t get another job before then.