Reading Rich Dad, Poor Dad (2007-10-07)

If you want a lesson in confusion, simply look up the words "asset" and "liability" in the dictionary.... An asset is something that puts money in my pocket. A liability is something that takes money out of my pocket. This is really all you need to know. If you want to be rich, simply spend your life buying assets. If you want to be poor or middle class, spend your life buying liabilities.

Robert T. Kiyosaki, Rich Dad, Poor Dad: What the Rich Teach Their Kids about Money--That the Poor and Middle Class Do Not!

Being from a middle-class background, the subtitle of Rich Dad, Poor Dad caught my eye in the Barnes and Noble personal finance area Saturday. As several responses to Don't Let's Go to the Dogs Tonight show, I like anecdotes. I read with interest Kiyosaki's contrast between his rich capitalist businessman dad and his poor socialist employee dad during his childhood in Hawai`i.

The folksy capitalist philosophy in Rich Dad, Poor Dad begins with an income statement and balance sheet. Kiyosaki simplifies each into two boxes with a line in the middle: for the income statement the line is horizontal, and for the balance sheet the line is vertical.

In the top of the income statement are earned income ("work for owner"), passive income, and portfolio income. In the bottom of the income statement are taxes ("work for government"), ownership-related expenses, and other expenses. Subsequent diagrams expand on portfolio income (dividends, interest, rental income, royalties), ownership-related expenses (mortgage payments, real property taxes, insurance, maintenance, utilities), and other expenses (fixed expenses, food, clothing, fun).

In the left side of the balance sheet are assets which create income--your business, stocks, bonds, mutual funds, income-generating real estate, notes, and intellectual property. In the right side of the balance sheet are liabilities ("work for bank") which create expenses--consumer loans, credit cards, and mortgages.

Poor Dad says, "Go to school, get good grades, and find a safe secure job." In other words, concentrate on earned income in the top of the income sheet. Rich Dad says, "The rich don't work for money, they have their money work for them." In other words, concentrate on passive and portfolio income in the top of the income sheet--with passive income being faster. In the bottom of the income sheet, the government taxes earned income the most, and passive income the least.

Rich Dad, Poor Dad consequently characterizes classes using these boxes. The earned income of the poor pays expenses in the income statement and little affects the balance sheet. For the middle class, expenses and taxes rise with income in the income statement, as do liabilities incurred on the balance sheet. The income of the rich purchases income-producing assets, with less rise in expenses or liabilities. (For example, a corporation deducts expenses from income before taxation.) In this way they practice the "pay yourself first" advice of The Richest Man in Babylon.

The challenge is defining "your business." Kiyosaki writes, "If I have to work there, it's not a business. It becomes my job." Timothy Ferriss has similar suggestions for a "muse" in the "Income Autopilot" chapters in "Step III: A is Automation" of The 4-Hour Workweek.

The goal for both Ferriss and Kiyosaki is freedom. The latter explains his wants:

I want to be free to travel the world and live in the lifestyle I love. I want to be young when I do this. I want to simply be free. I want control over my time and my life. I want money to work for me.

Readers of this blog will recognize this desire to travel and live abroad.

[Added diagram and corrected word.]

Simplifying on Saturday (2007-10-06)

I set aside days to reduce, organize, and save time. I want less clutter, and less to move if we live abroad. Between the winter solstice and the following new moon is one of the quarterly periods of Discardia, so I picked the first Saturday of the month.

This was similar to the three Saturdays in 2007-04-28/05-12. In April and May Ryan and I did "spring cleaning": cleaned carpets, framed prints, organized books, replaced lights, washed cupboards, and recycled as usual. This also including giving away books, clothes, and household items. This October Saturday we recycled, and cleaned and organized bathroom drawers, discarding unneeded items. Then we started walking.

Our Northgate neighborhood has a walk score of 75-- not as high as Jim's neighborhood. Nevertheless we were able to walk instead of drive to our errands: getting coffee (in personal cups), giving away household items (baskets, mugs, sweaters) at Value Village, recycling a mobile phone at Best Buy, and getting Ryan to work.

At the end of An Inconvenient Truth is "So here's what you can do personally to solve the climate crisis." Under "Get around on less" is "Reduce the number of miles you drive by walking, biking, carpooling or taking mass transit wherever possible." Under "Consume less, conserve more" are "Recycle" and "Carry your own refillable bottle for water and other beverages." I'm pleased to think this Saturday was healthy for my body (by exercising), my mind (by reducing clutter), and the environment (by driving less and recycling).

Reading Quarantine (2007-09-29)

Given my enjoyment of speculative fiction, it makes sense to follow a science book with a science fiction book. While I make occasional references to fantasy, most of my speculative fiction reading is science fiction; the books I've read this year include /, The Moon is a Harsh Mistress, and The Diamond Age. (I recommended in their reviews the following science fiction books: Xenocide, Children of the Mind, A Deepness in the Sky, Stranger in a Strange Land, The Number of the Beast, Animal Farm, Brave New World, Fahrenheit 451, The Left Hand of Darkness, Nineteen Eight-Four, and Cryptonomicon).

I didn't follow An Inconvenient Truth with a rereading of Dune, Dune Messiah, and Children of Dune. However, The Universe in a Nutshell discusses such science fiction topics as time travel (albeit concluding with Hawking's Chronology Protection Conjecture). Consequently I followed it with the Greg Egan's novel Quarantine.

The Universe in a Nutshell discusses the uncertainty principle often, including Feynman's multiple histories idea. Stephen Hawking explains the wave function as "a number at each point of space that gives the probability that the particle is to be found at that position." He discusses particle motion as a sum over multiple histories. In addition, he notes that "[t]he anthropic principle says that the universe has to be more or less as we see it, because if it were different, there wouldn't be anyone here to observe it."

These ideas appear in Quarantine. In Quarantine, Earth after the year 2034 is surrounded by a bubble preventing observation outside the solar system. Afterward researchers develop a mental device to inhibit wave function collapse. While the device operates, the first-person protagonist plays with probable histories, all the while wondering which history will happen, and which version of himself will observe the results.

The setting of Quarantine relies to some degree on the Copenhagen interpretation of quantum mechanics, with reference to other interpretations. The many worlds interpretation appears when the book's story line is several times inconsistent between periods in the protagonist prevents wave function collapse and subsequent events (e.g., a combination that is 1450045409 in one part of the narrative and ten nines in another). Even the Ensemble interpretation appears in name.

Greg Egan's plot is like a thought experiment, similar to Wigner's friend. As such it imagines how the quantum scales of books like The Universe in a Nutshell could affect observable life. In this way it is both entertaining and instructive.

Reading The Universe in a Nutshell (2007-09-14/18)

I have several scientific friends so I like to stay informed of recent theories. My physics familiarity extends from Newtonian mechanics to special and general relativity, but not beyond--and there have been more theories since I was in school. Consequently I selected one of Stephen Hawking's latest books, The Universe in a Nutshell.

I find I prefer science I can observe. Quantum scales are too small and relativistic scales are too large for me to see. (Though Arthur Eddington has observed the effects of general relativity.) In most of my life--except perhaps the night sky--classical theory is fine.

Nevertheless The Universe in a Nutshell was entertaining. I'm caught up, and relieved that superstring theory--which I missed entirely--may be superseded by M-theory anyway. I now know a generalist's overview of theoretical physics.

Reading Blink (2007-09-04/13)

Decisions are difficult. A good decision requires work; a bad decision brings consequences. More information sometimes helps, and--with the Internet--much information is available. However, consultant work gives me this perspective: more research delays a decision and increases its fee. Even if the decision is better as a result, the difference may be marginal and of less value than the lost time. During the delay no action is taken, which may have an opportunity cost. So I "sleep on it", stare out the window, or take a walk. I sometimes use these approaches--and my judgment--instead of additional information.

Malcolm Gladwell filled Blink: The Power of Thinking Without Thinking with anecdotes and studies about the effect of additional information on decisions. Some people assume that additional information always improves thinking; Gladwell cites situations in which that is not the case. An example is classical music auditions, which were biased against women until held behind a screen. The additional visual information actually distracted from evaluating the performance.

In the Afterward, Blink asks "When to Blink--And When to Think." The initial answer comes from Ap Dijksterhuis' studies on "unconscious thought" (which BBC News and New Scientist have summarized): think about simple decisions, sleep on complex ones. However, further reflection leads Gladwell to two qualifications: unconscious thought requires training, and statistical summaries suggest significant factors.

Gladwell gives examples of effect on judgment, both good and bad. Training improves judgment in the battle of Chancellorsville and the Millennium Challenge 2002. Biases have a bad effect on decisions we make in the "blink of an eye"; examples are the shooting of Amadou Diallo and the results of an Implicit Association Test.

In addition to training, statistical summaries also improve decisions by suggesting significant factors. The Wages of Wins suggests it is difficult to estimate summaries from incomplete observations of small differences. A report from Cook County Hospital exemplifies how statistics can isolate the factors relevant to a decision.

Statistical summaries also have their role in my consulting. I just completed a project requiring analysis of millions of records I imported from daily data and queried for mapping and evaluation. I use statistics, training, and unconscious thinking to improve the speed of my decision-making.

Walking to Work (2006-10-26)

Walking to the bus reminds me of my morning commute in Paris and renews my commitment to venture and work abroad again. In Paris Tuesdays through Thursdays we would awaken in Pigalle. Ryan went to school in Saint-Germain-des-Prés and Jean Claude went to work in Montmartre. I followed Jean Claude out onto Rue André Antoine, smelling the wet cobblestones as the street cleaners washed away the previous day. I heard the sounds of other pedestrian's shoes on the wet cobblestones and an occasional car vibrating along the street. The October air cooled me as I leaned into the steep hill and climbed. One morning in late October I took a photograph of the sunrise in Montmartre. Later on those weekdays I walked back down to Le Chao-Ba-Café for the afternoon sunlight.

On weekends--sometimes long weekends including Friday and Monday--Ryan and I would travel. We visited Montpellier, Nantes and Tours, Chamonix, Berlin, and London. We didn't visit Barcelona or Venice like we had hoped.

Memories and daydreams make me think of "Disappearing Act: How to Escape the Office", chapter 12 of The 4-Hour Workweek. A colleague who also develops software for Geographic information systems is currently in Turkey while his wife teaches. Perhaps I can do the same somewhere while Ryan teaches ESL.

Reading The Diamond Age (2007-08-26/09-03)

Neal Stephenson's The Diamond Age: Or, a Young Lady's Illustrated Primer has a future earth setting in which nanotechnology has significantly reduced scarcity but artificial intelligence has not been achieved. I enjoyed Cryptonomicon by Neal Stephenson (especially its encryption themes, which are present as well in The Diamond Age) and decided to read another of his books.

The "Diamond Age" is due to molecular control of matter making diamond--with multiple productive properties--a common material. (Wikipedia attributes this idea to "It's a Small, Small, Small, Small World" by Ralph C. Merkle.) It is interesting that the social organization in the story still contains classes, even though matter compilers make clothing, food, and covering available to all. I like to imagine how a just society would work.

The lack of artificial intelligence appears reasonable. The actual achievements of AI have always fallen short of predictions. Alan Turing estimated that by the year 2000 machines would be able to fool 30 percent of human judges during a 5-minute Turing Test. In 1965 H. A. Simon wrote that "machines will be capable, within twenty years, of doing any work a man can do." In 1967 Marvin Minsky wrote, "Within a generation ... the problem of creating 'artificial intelligence' will substantially be solved." Clearly none of these predictions have appeared.

I look forward to seeing how these areas--nanotechnology, scarcity, justice, and artificial intelligence--develop during my lifetime. Perhaps I will see some possibilities fulfilled.

Walking (2007-09-07/14)

Walking has long been and probably will continue to be important. For me it is part of a happy and healthy mobile lifestyle.

Walking was part of my life in various ways in the past. Summer visits to the houses of each set of grandparents involved a daily walk. During a few years of grade school I lived a block from public land in which I hiked and daydreamed short stories I would write. During high school I walked several miles to and from each Medford school I attended, each day choosing a different route than the previous. Later I again lived on the edge of public land. During undergraduate education I walked around Corvallis--especially the Oregon State University campus--alone or with friends, thinking or talking about life. During and after graduate school I similarly liked to walk the University of Washington campus.

My business partner recently revived his own childhood love of walking. A few years ago when my company moved to from the University District to Westlake, I encouraged walking to lunch in South Lake Union the way we had walked to lunch on The Ave. At most we would walk half a mile. Then he purchased a pedometer to compete with friends. Now he tracks his walks, totaling 10,000 steps per day, around the office and his neighborhood. He even ordered an Omron HJ-720ITC pedometer for me.

Consequently I have begun tracking my walking as well. I suspected I already met the guideline of 30 minutes of moderate activity 5 to 7 days per week, in walking to the bus, to coffee, to lunch (e.g., to Paddy Coynes in South Lake Union), and on the elliptical trainers (at the IMA). Now I am carrying a pedometer to verify that.

It is helpful to distinguish moderate activity like brisk walking from other steps. The U.S. Department of Health and Human Services cites publications suggesting that 30 to 60 minutes of activity broken into smaller segments of 10 or 15 minutes throughout the day has significant health benefits. The Omron HJ-720ITC has an aerobic step function that displays the minutes walked and number of steps walked at more than 60 steps per minute for more than 10 minutes continuously.

This past week provides me preliminary step estimates for moderate activity. Evidence suggests 30 minutes of moderate activity is equivalent to 3000 to 4000 (aerobic) steps, and that even sedentary adults accumulate 5000 (other) steps. I'm pleased that my average aerobic walking time was 35 minutes per day (3860 steps), but this week only three days had more than 30 minutes (3240 steps). Other (not aerobic) steps ranged from 3310 to 8740 with an average of 6480. An average day for me with 30 minutes of moderate activity therefore would have 9720 steps (though carrying a pedometer may have an effect like the Hawthorne effect). Perhaps I'll join 10,000 steps.

In addition to the health and happiness benefits of moderate activity, there are lifestyle benefits. Walking to and from the bus stop is part of a lifestyle in which I drive cars less and read more books on the bus. It is also part of a lifestyle in which I am fit enough for adventure.

Reading A Year of Adventures (2007-06-13/07-04)

I feel wanderlust and want adventure. Needing some plan, I purchased 25: Wildlife Adventures and A Year of Adventures: Lonely Planet's Guide to Where, What And When to Do It. The second book has sections for four weeks per month; each quarter also has a section of sevens--seven continents, seven summits, seven natural wonders, seven heavenly objects--for the "missing week."

If, for example, you have time off in December or January, you can turn to those months in the book. In each weekly section are several activities appropriate to that time of the year. Under each activity title is country, type of activity, fitness or expertise level, an explanation as to why that week is the best time, and a description. The following are examples (in late December and early January) of warm activities not requiring expertise:

• go to Micronesia,
• elephant trek in Mondulkiri Province,
• climb the Sydney Harbour Bridge,
• do canopy tours at Santa Elena,
• watch Jigokudani's snow monkeys,
• travel on an African truck,
• go to Robinson Crusoe Island,
• go to Queenstown, New Zealand,
• do gorilla tracking at Bwindi, or
  
• climb Sri Pada.

I found the entire book entertaining reading and read it straight through despite the arrangement. Many activities have seasons that span more than one month.

There's also a Web site with a search of G.A.P. adventures. For example, I searched for the following 15- to 20-day adventures between December 14 and January 8:

• wildlife/nature,
• trekking/hiking, and
  
• yacht/sailing.

The question that accompanies "Where should William go?" is consequently, "What should William do?"

[Corrected punctuation.]

At Café on the Ave Reviewing Workouts (2007-09-06)

Usually I come to Café on the Ave after cardiovascular exercise, so today I'm reviewing my workout performance, principles, goals, and strategy. I attempted 3 times per week (of 20 to 30 minutes with heart rate in target zone--for me, 125 to 145 beats per minute) and succeeded for the first four months of 2006. In May I went twice a week, and in recent months even less frequently, making the year-to-date average 2 times per week.

The "sharpen the saw" principle (that Ferriss borrows from Covey) for the physical dimension reminds me that I need to be healthy. I want the energy, relaxation, and satisfaction with being fit that working out gives me.

The American Heart Association has goals for moderate intensity activity, vigorous activity, and resistance training. The ranges for the first two categories are similar to corresponding exercise zones based on maximum heart rate.

1. Do 30 minutes of moderate activity 5 to 7 days per week. Moderate intensity is 40 or 50 to 60 percent of capacity, equivalent to a brisk walk.
   
2. Do 20 to 40 minutes of vigorous activity 3 to 5 days per week. Vigorous intensity is greater than 60 percent of capacity; 60 to 70 percent is "fat burn" while 70 to 80 percent is "cardio".
   
3. Do resistance training 2 or more days per week. This means 8 to 10 different exercises with 1 to 2 sets and 10 to 15 repetitions per exercise.
   

I suspect I already meet the first guideline, but a pedometer could verify that. The minimum for the second guideline was the attempt this year that I described above. I usually followed cardiovascular exercise with resistance training, but only 4 different exercises (and 3 sets of 10 to 15 repetitions). These can be additional goals for the remainder of the year.

How do I accomplish this? Ordinarily goals lead to tasks which I schedule, but I feel unmotivated now. Workout buddies help me because usually at least one person is motivated. However, my current workout buddy (Ryan) appears unmotivated as well. I want renewed motivation.

[Added graph and edited hyperlink.]