Wonderful Wiki Writer

I'm toying with the idea of putting the work described here up on Wikibooks. It would go here (so if I actually do it, that last link will take you to the Table of Contents of the script).

The idea is to just "put it out there" and see if anything happens. Since everything on Wiki* gets the GNU Free Documentation License I think it would accomplish my original goals of getting the story out there. Also, this potentially fulfills an idea that I've been toying with for online collaboratively developed fiction. In essence, as long as it's work that I don't care to profit from, it's fine to be freely published. Additionally, the potential community benefit of dedicated man-hours to a project which I've decided that I have no time for anyway is a boon.

On the other hand, who the hell is going to care? And what if I *do* want to profit from it someday? Ho hum...

Numerical Progressions

What's the significance of the following set?

n = {NULL, NULL, 0.5, 2.6, 4.4, 6.0, 7.5, 8.9, 10.3, 11.6, 12.9, 14.2}

Well, these are APR values that can be fed into the following equation for calculating the monthly payments of a fixed 30-year mortgage.

p = ( c / 100,000 ) * ( x * 100 )

where:
p = monthly payment
c = cost of the mortgage
x = the position within array n[] that matches
the available APR when x = 3 for n[x] = 0.5

For example, the difference between the monthly payment for a $300,000 mortgage at 4.4% versus 6.0% is:

p(4.4) = 3 * (5 * 100) = $1500
p(6.0) = 3 * (6 * 100) = $2000

Or, more precisely:

It costs $500 for every $100k of mortgage when the APR is 4.4% and $600 for every $100k of mortgage when the APR is 6.0%.

Why does this matter? Simple. It means that as APR's decrease, buying power increases. A mortgage of $500k where x=3 (APR of 0.5%) costs the same as a mortgage of $250k where x=6 (APR of 6.0%) which cost the same as a mortgage of $125k where x=12 (APR of 14.2%). And that cost is $1500 per month.

The math lesson is that every time x is cut in half, the market determines that the cost (c) doubles because inflation dictates that payment (p) will approximately stay the same.

The economic lesson is that if you get a mortgage for x=5 (APR of 4.4% (which is realistic in today's economy - because (a) the Federal Reserve is contemplating lowering their lending rate to 0.25% and (b) banks are happy to lend at that rate plus inflation (which is ~4% per year))), you can expect to sell into a market with a higher APR. Thus, when you go to sell, you can expect the value of your house to be worth whatever appreciation can be attributed to inflation times 5/x(future).

Similarly, if you have a mortgage for x=9 (APR of 10.3%) then you can currently sell for the appreciation that can be attributed to inflation since the time of your purchase multiplied by 9/5 (or 1.8). Thus, if you bought 18 years ago for $100k, appreciation dictates that the value would have doubled to $200k and the APR dictates a NPV of $360k. Meanwhile, if you got an ARM loan a few years ago and the prime rate increases to x=9, you just got royally messed up because you won't be able to sell into the market without losing money (because your buyers won't be able to afford a purchase price higher than what you paid).

So what does all this mean? It means respect the 30% rule and don't overextend yourself while purchasing real estate because it's no longer an investment like it was when I was born in 1982. It's just a shelter and a tax shelter. And unless cost (c) actually drops by another 20% renting is probably a better value. This is because the magical "8-12% average rate of return" for real estate since 1983 has been largely attributed to the decreases in APRs. Feel free to check out the historical data and run a few calculations of your own. And considering that the "rate of doubling" for inflation at 4% is 18 years, it's easy to see that the $100k => 360k example is real. Similarly it's easy to see that $400k => 444k after 18 years if the APR jumps from x=5 to x=9. Yikes! 11% over 18 years (not including inflation, the expected inflationary value would be $800k) is a really bad way to spend $2000 a month when you can rent a similar place for $1200 and invest the rest of the money (minus the $600 tax shelter) in something more valuable. Of course, maybe x won't decrease below 5 in 20 years. Maybe it'll stay the same. Bottom line -- it's complicated.

Three-Pronged Attack

In wartime, a popular strategy is the use of a "Three Pronged Attack". What this essentially means is that the attackers will use three different forces to attempt to achieve some goal.

For my personal life, I've mentally adapted this concept to apply to the goal of raising enough finances for retirement. The different prongs are (1) traditional methods, (2) entrepreneurial methods, and (3) investment methods. Basically, I figure that "diversifying myself" is the best plan towards financial security.

The three methods elementarily break down thusly: (1) work for somebody else, (2) work for yourself, and (3) have somebody else work for you. There's nothing novel about these three individually, but I think combining them as a semi-formalized diversification strategy is somewhat novel. So it goes, three-prongs for me.

A Review!

I found a review of my work over on one of the wordpress blogs. I think it's a good and honest tribute of my work, though the author points out, "There are a few more obvious errors". I assume this refers to type-o's and other grammar errors, and this isn't something that I would argue with... as I've been following up on my own private revision of the story for some time.

I also found that I'm cataloged over at The Assayer (which provides book reviews and discussion for the free-information renaissance).

And I'm going to announce April 15, 2009 for the release date of the revised version of 2076. As of this writing, it's noted on the book's website that it's an "Unpublished Novel" which was my way of saying "I know it needs work prior to publication". Officially, I had uploaded that version to the Internet on July 4, 2007 and then let it stew (both on the site and in my head). By now, the April 15, 2009 version is expected to be the "Published Novel" version of the story. Maybe I'll schedule a Publication Party (won't that be fun!). There'll definitely be a cake.

There will additionally be an Audiobook, which is already a work in progress (although I'll probably redo what I've done so far). As it stands, when I listened to the recording of myself reading my book, I physically yelled at the speakers during parts where words need to be removed, added, rearranged, or modified (this was during a car ride from NJ to Boston earlier this month). My current plan is to listen to it while I've got my laptop in front of me and work out those kinks and re-record... and then call it "Publishable". I should apply for a patent for that... "a method to accomplish Copy Editing through the process of revising the work as the recording plays back". But yeah... that's the basic plan. Mark your calendars for the Party.

New Homepage

This post is to announce the introduction of the site www.robertvandyk.com. During a trip to NJ two weekends ago, it occurred to me to check for the availability of this domain and I was pleasantly surprised to be able to pick it up. Unfortunately, godaddy.com's "Free Hosting" means that they corrupt all my pages with an advertisement banner... so I'm eventually going to have to upgrade to a paid hosting provider.

The future goal of this domain is to showcase various artistic accomplishments that I produce over the years, including but not limited to (a) writing, (b) videography, (c) photography, (d) painting, (e) music, and (f) culinary arts.

In the meantime, I also secured a couple of domains for possible business ventures. Did you know it costs $500 in "administrative fees" to process the forms to establish a Limited Liability Corporation in the state of Massachusetts? This is the page that has all the information on that. The only prerequisite that I saw was (a) you need a Massachusetts address where company papers are stored, and (b) you need a Federal EIN (which is free). Also, you're required to produce an "Annual Report" that they charge you an addition $500 for every year. All else being equal, though, if you're running a business and not generating at least $500 in revenues each year you probably shouldn't be running that business.

The first possible venture is the discussion item number four from Evolutionary Thought. The goal of that would be to become a city sanctioned (or not) advisory institution who offers guidance towards individuals who don't know much about large and complicated purchases that they're not sure they can afford. Things like college, homeownership, and automobiles all fall under the category of "expensive" and there are a wide range of possibilities that can quickly fall into the "over-budget" category of financing. It's my theory that this sort of agency could have prevented the economic crash because it doesn't take a finance student to realize that you can't afford a $600k mortgage on $50k per year. Thus, this venture will protect people and banks from themselves.

The second possibility, although the one I feel more strongly about, is incorporating my own publishing company. One target would be to produce and sell my own novel, but I would quickly branch out to publishing work from others, as capital began to flow in.

Hopefully there will be updates on one or both of these ventures periodically in the future. Though, rest assured that as time passes you'll begin to see robertvandyk.com built-up.

Competition and Productivity

There's a belief that competition drives innovation. Monopolies stagnate when they're allowed total control over entire industries. Invisible forces maintain control over competitors to ensure the right balance of efficiency and production.

Ergo, Microsoft needs Apple, Google needs Yahoo, Walmart needs Target, and Verizon needs AT&T. But having said all that... these companies are in competition with one another for dominance and control of their respective marketplace. They each individually want to control the market and set prices at whatever they want. As a result, you see them use every opportunity to get advantages over each other. From advertising to prices to cross-promotions with other favored industries... there's always some way to gain an advantage. And that's to the benefit of everybody.

However, another way to gain a competitive advantage is to "trim the fat". Oftentimes, this resolves to identifying the least productive areas of the business and figuring out how to integrate their functionality into other areas (this is called "synergy") or creating better methods of accomplishing the same things (called "innovation"). With synergy and innovation, companies are able to produce the same quality of goods and services for less cost and with less manpower. This is generally good, until you consider the last bit about "less manpower".

Industries keep around their labor force to maintain expert knowledge during the transition from the old systems to the more efficient new systems. As the expert knowledge is utilized to iron-out bugs with the new synergies and innovations, the expert knowledge becomes common knowledge. After that, less emphasis is put on maintaining the personnel who had the expert knowledge. In addition, other pressures are applied for the business to build profits. The natural response to that is... job cuts! So the people who aren't needed anymore because their roles have been replaced are let go.

Then you have unemployment... which is where the country is currently at. 6.5% of the current workforce is unemployed. That's how new industries are created. Either the emerging energy industry will find a place for those people or something new will come along. If not... something cataclysmic will happen. And that is... the government will step in and find work for the unemployed. At the end of the day, the final competitive balance that Google, Microsoft, Walmart, and AT&T have to face is Washington. If those companies lay off too many of their employees... Uncle Sam will pick up the slack. That's the PRIMARY FUNCTION of government... security for its population.

Ergo, if companies don't want to answer to a stronger central government, they need to stop laying off their workforce or else the government will step in and start "hiring" all these people in some capacity or another.

This is why it is particularly unnerving that The Federal Reserve has not stepped in to bailout General Motors. It's as if the government has a different plan for Detroit (maybe they want to implement the GTC!). Either way, there's a waiting game to see if GM can pull themselves out of the muck or if the government enact some radically new legislation that'll make large scale automotive manufacturing obsolete.

What is also particularly unnerving is the Exxon has sat on their hands through the entire Gas/Energy crisis. It's as if they don't care. How dare they have record profits while other industries suffer. Fuck them. With their billions in profits, they ought to rebuild Detroit and New Orleans! At the very least, they *ought* to make headlines with whatever their efforts have been to replace the fossil fuels that have been the lifeblood of their company for so long. Investment in solar technology? Investment in wind power? No, as far as we know the executives at Exxon are swimming in their profits like Scrooge McDuck used to swim in his vault. And as a result... by sitting on their profits I predict a rude awakening for Exxon during the upcoming administration.

And that's the invisible hand of the market. Corporations versus governments. And in the end... everybody wins.

The Director

My friend, Chris, does photography workshops for aspiring artists. I would link his webpage, but off the top of my head I don't know it. Anyway, during his workshops one of the topics which is apparently discussed is how to use an Adobe software product called Lightroom. Supposedly, this is "the best thing out there" for managing catalogs that include thousands of images. Having spent an afternoon clicking "Next, next, next" through a list of 1500 vacation photos from August, I easily believe that Lightroom provides a lot of added value for its users.

That said, according to Chris, there aren't many options for photographers who want to get the most out of Lightroom. Sure, they can sign-up for Chris' workshop and get the day long immersion, but that isn't economically sound for everybody. Another option is a series of videos that are available here. I watched about half an hour of these with Chris last week and they are *boring*. Plus, the full collection is like 8 hours long. Often, the presenters is these videos are rambling. Seldom, they are engaging. In sum, if you have 8 hours to spend learning Adobe Lightroom, you may as well just spend that time digging into the product and figuring it out on your own. There is simply no value in highlighting every button, menu, or toolbar in the product.

Thus, I met with Chris last week to brainstorm ideas on how to make a quick, engaging video that educates users on the different uses of Adobe Lightroom. I'm going to be the director and the cameraman. He's going to write, edit, and star in it. His photography workshop partner Aaron is going to co-star in it. We'll all be producers, I suppose. The plan is to start filming in Boston in the beginning of November and finish by the end December. I recall editing of my movie took months, but this should be a lot easier because their will be a much easier flow to piece together.

And I leave you with semi-meaningful statistics:

Current RBCDD Score: 27
Commissioned Artwork in October: 3
Ideas: GTC, LE, 2076, CPFP, CBLRP