How Google Could (Slowly) Kill the IPad
If Google were to release a Chrom OS tablet they might be able to give Apple a run for their money.
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National Security Is Up To You And Me

“…the fact that it wasn’t worse comes down to terrorist incompetence, citizen bravery, and nothing else.”  In one brief sentence Bob Cringely summarizes whats wrong with the TSA and our general expectations of security.  We are expecting our government to protect us in a way that we ourselves should be responsible for.

Our Federal Government in general is good at protecting us from outside forces.  In 234 years we basically had only one military attack on our shores[1] (Pearl Harbor) and one non-military attack (9/11).  There are countless examples of their failure to protect us from ourselves. In fact, thats not even what they should be doing.  When they do it usually turns into a nightmare like Kent State or Waco.

At some point we have to take responsibility for ourselves and stop relying on the Federal Government for everything.  The guy who helped stop the Crotch Bomber (and who hopefully got in a few strategic punches to the moron’s face) did just that.

The Government screwed up, no question about it, but they’re comprised of human beings so its inevitable.  What we usually don’t hear about are the countless times they didn’t screw up and stopped what could well have been worse than the terrorism attempt on Christmas Day.

So instead of using the recent incident as an example of how much the Government sucks lets use it as an example of taking personal responsibility, even if only a little, for our own security.  Let the CIA and the military do what they do best but when one slips through lets make it known throughout the world that we’re more than willing to step up.

1. Since Hawaii wasn’t a state at the time one could argue it wasn’t even an attack on our shores but on the shores of a protectorate.

We’re Throwing Our Money Away!

Thats the almost universal response we get when we tell people we’re selling our house.  I guess I can’t blame them since for so many years we’ve been conditioned to think that owning a home is such a great investment.  That may not be so but I’ll talk more about that later in this post.

The general consensus from my research is that our house won’t be worth what we paid for it for at least another ten years.  In other words, it’ll take over fifteen years from the time we bought it in 2004 for us to be able to sell it and break even.

So lets assume that we don’t sell now but rather wait until 2020.  In that time we’ll have paid almost $100,000 in interest which includes the mortgage interest tax deduction.  Thats also assuming we don’t refinance which, given the foreseeable lending climate we stand a snowballs chance in hell of actually getting approved for.

Now lets add on the $300 per month HOA dues.  Yes, thats a crazy amount but its actually not quite as bad as it seems since that pays for snow removal and our water and in this part of the country both are very expensive.  That brings us to around $2000 per month in total payments to live in this place.

Our plan is to rent for a year or two after we sell this house.  This is where everybody says we’re throwing our money away.  During that time, since we’re going to be debt free, we’re going to be socking away money to use for a nice down payment.

Lets assume for now that we buy a $250,000 house and that we can save up 5% to use as a down payment.  Thats $12,500 though I’m sure we’ll be able to save more than that.  Its hard to say what the rates will be in two years but for the sake of argument lets assume that when we buy in 2012 we’ll get an interest rate of about 5.5%.

After living in that house for eight years, by 2020, when our current house will finally be worth what we paid for it, I estimate we’ll have paid about $90,000 in interest including the mortgage interest tax deduction.  Already we’ve saved $10,000 in interest.

During the two years we plan to rent we can expect to pay between $1100 and $1400 per month for the kind of place we want.  A potential savings of $900 per month over our current payment that we can put toward our down payment.  That puts us in the 10% down payment range.  The more we put down the lower our payments are and the higher the chance of paying off that house’s loan early.  On a $250,000 house with a 5.5% APR we would pay over twice the purchase price in interest over the life of a 30 year mortgage.  Talk about throwing your money away!

So after all that how is owning a home a great investment?  Well historically real estate has appreciated quite well.  The house I lived in until I was 13 was purchased new for, I think, around $30,000 in 1973.  It is currently on the market for $155,000.  Had my parents stayed in that house it would have been paid off approximately seven years ago not to mention by now that what may have been a high monthly payment in the early 70’s would be chump-change these days.

Jill’s grandparents bought a house in 1953 and her grandmother still lives there.  Ostensibly its been paid for since 1983 so they’ve had almost 30 years of no payments and a house that has had almost 60 years of appreciation.  I don’t know what they paid for it back then but lets assume it was around $15,000 which is about $120,000 in todays dollars [1]. Sold right now it would easily get over $200,000.

Assuming her grandmother sold today she would realize an adjusted return of $80,000. At first glance thats not a bad return on investment but over 57 years it becomes less appealing.  Appalling really.  That $15,000 put into the stock market back then would be worth almost $500,000 today [2].

Now lets be clear. That $80,000 is an adjusted return.  In reality she would walk away with a great deal more cash.  More than enough to live the rest of her life comfortably and leave a nice chunk to her children.  And thats why people say owning a home is such a great investment.  But here’s the catch, if you haven’t already figured it out;  In order to walk away with that much cash she would have to have lived in the same house for nearly 60 years.  Sure some people have doubled their investment in less than five years but that was during the bubble and its HIGHLY doubtful that’ll be possible again soon if ever.

Besides, who do you know who lives in the same place more than five years anymore?  Much less 60.  In today’s society we basically trade up houses like we used to trade up cars.

There’s another thing that nobody seems to consider and that is, when you’re renting there are several things you don’t have to take care of.  You don’t paint the exterior.  You don’t repair water leaks. You don’t replace roofs.  Almost all of these are the things you have to do if you own a house.  If you’re like me you can find a middle ground by buying a townhouse or condo but you make up for it with ridiculous HOA dues like ours.

There is an advantage to renting if there are certain conveniences you’re willing to pay for.

Coming back to our decision to sell.  Our original plan was to stay in this place between 5 and 7 years.  We just hit the 5 year mark.  We have kids now so we would like our next house to have a yard that they can play in.  A house we will most likely stay in for far longer than 5 years.  We put a decent amount down when we bought this house so despite the down-turn we actually won’t be losing very much at all when we sell but we’ll definitely make up for that in the amount we’ll save in interest paid after ten years.

As I proved before, we will be saving between $600 and $900 a month when we rent purely in the difference in monthly payments.  But thats not taking into consideration the interest we’re also currently paying that we wouldn’t be paying when we rent.  Sure we get a tax deduction on that interest but the deduction isn’t 100%.  Not even close!

Also consider that the next house we buy will be done in a comparatively reduced market which means if and when we do sell, assuming we keep it long enough, we will realize an even greater profit than we would were we to stay in our current house.

So will we be throwing our money away for those two years?  In fact, I think its the opposite.  We would be throwing away our money to stay here for ten!

Having said all that I don’t want you to walk away from this post thinking that everyone should sell immediately and rent for a few years.  We’re not underwater with our house, primarily because we put money down when we bought it.  In 2004 the “no money down!” loans were all the rage so the country is littered with people who owe more than what their house is worth.  Hence our current economy being in the toilet.

Would I recommend everyone do what we’re doing?  Not necessarily.  Everyone is in a different situation and absolutely MUST do the research before making any decision.  I do think that if you have the money to put down and can convince a bank to give you a mortgage loan there are endless steals to be had right now.  If you can get a place that you’re willing to stay in long enough you may well just be making a great investment.

1: http://www.westegg.com/inflation/

2: http://www.moneychimp.com/features/market_cagr.htm

If You’re Not Reading, You’re Not Growing

I’m no fan of New Years resolutions. To me its just goal setting and I think one should be able to set a goal anytime between January 1 and December 31.

Many people make a resolution to go to the gym every day because they want to lose 30 lbs in a month (or some other ridiculous amount). Now setting a goal is great but be realistic.

I think one of the best things you can do to improve yourself is to read.  Its hard for me to imagine not reading.  I still remember being in elementary school and reading the back of the cereal box for the fifth time because I had to be reading something while I was eating breakfast.  Sadly there are people out there that simply can’t associate the words reading and pleasure.

Nothing Hollywood can show you can come close to matching what your own mind can create.

However if you want to grow you have to read.  Its as simple as that.  Why else would English (grammar or literature) be one of the few classes we are required to take every year from first to twelfth grades?  I’m assuming thats still so anyway.

When you get to college they drop a list of required reading on your lap.  When you start a job theres a good chance they give you a handbook of some sort and, at least half-heartedly, expect you to read it.

And thats just the boring crap.  There’s so much more interesting things to read out there!  If you’re a NASCAR fanatic then pick up a biography on Dale Earnhardt.  Sure there are documentaries you can watch on DVD about him but reading puts you right there in the moment.

Don’t believe me? I still vaguely remember when John Lennon died but it didn’t really mean anything to the seven year old me. By the time I was in High School I was a major Beatles fan and had even read several books on them as well as seen documentaries.  But what stands out is a biography on John Lennon and after reading the chapter on when he was murdered I wept. Sobbed. It was so real in my mind it was as if I were there when it happened.

Theres something about reading that drags us out of this life and into whatever it is we’re reading about.  Especially if its a well written book.  Many would argue that the Harry Potter series is the furthest thing from quality literature yet its such a compelling story that millions of children and adults adore it.  I’ve read the series myself and I can say that while the movies are great the books are 100 times better.  Nothing Hollywood can show you can come close to matching what your own mind can create.

So if you must make a New Years resolution make this one; read one book per month.  It doesn’t matter what the book is.  If you’re not in the habit of reading then find something that interests you the most.  Even if its some trashy romance novel.  The goal isn’t so much to read a lot of books but rather to build the habit.  After about six books you may even want to attempt reading two books the next month.  One them can be the same romance novel but the other should be something a little more difficult.  Nothing major like War & Peace.  Just something to expand your mind a little bit.

You will notice an improvement in your life.  That I promise you.

And, by the way, if you’re at all interested in Fantasy then you HAVE to read the Song of Ice and Fire series by George R. R. Martin.

HTML: The Worlds Most Feared Language

I’m amazed at the lengths some programmers will go to in order to avoid having to write HTML.  There are entire libraries in PHP, Perl, Java, you name it, that do nothing but define methods and functions that will create a particular HTML element.

For example;

<?php
function break()
{
    echo "<br />\n";
}
?>

Now how is writing <?=break()?> possibly easier or faster than writing <br />?

I’ve even see libraries in JavaScript that do this which boggles my mind even more.  I can almost understand a seasoned C programmer wanting such a library since they’re basically used to doing things with functions anyway. (yes, I know thats oversimplified. Work with me)  Given JavaScript’s history of tight integration with the DOM and HTML in general it makes no sense.

You could have:

function div(content, id_name, class_name)
{
    var el = document.createElement('div');
    var el_id = document.createAttribute('id');
    var el_class = document.createAttribute('class');

    el_id.nodeValue = id_name;
    el_class.nodeValue = class_name;

    el.appendChild(el_id);
    el.appendChild(el_class);

    el.nodeValue(content);

    document.appendChild(el);
}

div("Hello, World!", "foo", "bar");

but that will never be better than just typing:

<div id="foo" class="bar">Hello, World!</div>

Not only does the former require more characters but the browser has to work significantly harder since it has to parse the JavaScript and then reflow the page when the DOM is changed.

I’ve seen programmers write code that sends everything as XML to the browser which has JavaScript code that transforms the XML into HTML. A play on the technique mentioned above but no less stupid.

All this has convinced me that far too many programmers are afraid of HTML.  Being a markup language, its lack of parentheses and braces confuses them.  ”How do you assign a variable?”, they ask.

In reality its not fear but lack of respect that drives these programmers.  And these are the same people who, at the start of this post said to themselves, “HTML isn’t a language”.  To which I reply, HyperText Markup LANGUAGE.  Suck it.

The End Of The Beginning Of Hand Crafted Content

Michael Arrington has an interesting post on companies like Demand Media and Associated Content suggesting they are doing nothing more than encouraging bottom of the barrel content rather than quality journalism of the old print media.

First, many would suggest, and I would agree, that “quality journalism” hasn’t existed in the print media (or TV media for that matter) in a very long time.  So bottom of the barrel is subjective.

Second, I have to disagree with Arrington’s premise that the only content on such sites is of poor quality.  Sure there’s a lot of bad stuff there but I would argue that with Associated Content’s model especially that there is financial incentive to produce quality content.

Before moving on I should add the disclaimer that as of tomorrow I will be an employee at Associated Content and this or any other posts and opinions I make here do not necessarily reflect that of my employer.

My employment with them should not diminish the fact that with Associated Content, if you write quality content on a topic that is of interest to a broad swath of the population then you the author will be paid for it.  The more demand there is for that content the more you will be paid.

I think Demand Media’s model is different in that, if I recall, they pay up-front* and try to monetize the long tail more so than AC.  I think that model might tend to encourage lesser quality content so some of Arrington’s arguments may be valid in that case.

To my mind it would behove the journalists who are leaving the failing print media companies and putting their own stake down to post their articles and blog posts at Associated Content in addition to wherever else they might place it.  As Arrington said, more outlets means better reputation and, in the case of AC, more potential for revenue.

* Correction: Demand Media does offer a revenue sharing option in addition to paying up-front for content.

The Government Should Be Protecting Us!!

Just read an interesting post at TechCrunch about an apparent scam by Video Professor.  I’m not saying it is or isn’t a scam necessarily though I do think Michael Arrington makes some good points.

What bothers me is this quote, “Our governments should be protecting us from this nonsense…”.

To which I reply, why?  Why should our governments be protecting us from this when we have outlets like TechCrunch to warn us about scams?  And I would argue that TechCrunch alone is probably far more effective at making people aware of such scams than a government ever could.

I would also submit that given the number of individuals and other governments around the world who are actively trying to destroy us I think our government has plenty on its hands doing what its actually relatively good at.

Should the government be taking legal action against Video Professor?  If they are in fact doing something illegal then I say wholeheartedly yes.  Should the government be proactively trying to protect us from scammers?  Well, just ask yourself how well the SEC protected us from Bernie Madoff.

My Fallacy With Donating To Lobbyists

For the longest time I had a personal policy against donating to Special Interest Groups, aka, Lobbyists.  It wasn’t that I disagreed with some of their views.  I’m a die-hard gun rights advocate but I never donated a dime to the NRA purely on the principle that I disagreed with the entire idea of lobbyists. My problem is the fact that the SIGs can afford to pay millions of dollars to sway the vote of elected officials and I can’t.  In fact, who are my lobbyists?  Oh, right, its supposed to be those same elected officials.

Sure, organizations like the NRA do a lot more than lobby congress but thats a key function for them so I chose to support them vocally rather than monetarily.

The fallacy in my thinking is that I’ve actually already been supporting SIGs all along and so have you.  Every time you buy something from Microsoft, Apple, Dell, and many other software companies you’re supporting the Business Software Alliance.  You probably don’t care much about that unless you’re an opponent of software copyrights.

Ever taken an Ambien?  You’ve supported the Pharmaceutical lobby.

This is one of the reasons I support the Change Congress initiative.  The idea isn’t necessarily to make lobbying illegal (fat chance of that) but rather to put pressure on the elected officials to work for the people more than the SIGs.

The other problem with my choosing not to donate to SIGs is that it also prevented me from donating to organizations I definitely support like the Electronic Frontier Foundation.  It can be argued that their lobbying is significantly less than that of the Pharmaceutical lobby.  Regardless, they do very important work at the EFF and standing on principle prevented me from helping them.  Sure I can donate my time and I plan on doing that when I can but money talks. Especially in Washington.

Premature Chrome OS?

So now that Chrome OS has been out for a few days the consensus seems to be a little bit of “meh”. Did Google release it too early?

When Gmail came out the world was abuzz. Even Wave has people begging for invites despite not knowing what to do with it once they get one.

But the hype doesn’t seem to be there for Chrome OS. So why did Google release it so early?

The reason they give is that they wanted to get the code into the wild early so developers could start hacking on it. And while I think that’s a good and perfectly valid reason I’m not convinced that’s the only reason. I think the marketing machine part of Google is kicking in. It was inevitable. Taking on a marketing giant like Microsoft can’t be done by geeks alone.

So the Google marketing team is being loosed upon the world and they’re doing what marketing people do. They’re drumming up buzz. But at least they’re doing it the typical geeky Google way. In the recent past we’ve seen them announce Android and it’s various versions, Chrome, Wave, Go, Closure Javascript tools, and now Chrome OS.

The problem is that the marketing group is getting a little ahead of everyone else and now we have Chrome OS about six months too early. Imagine what we would be playing around with had Google waited until Q2/Q3 2010 to drop their Windows killer.

We might have O3D built in so we could develop and play more modern games. They could have packaged it up for the various virtual machine products instead of relying on some altruistic but potentially nefarious hacker to do it for them. There would certainly be better offline support.

That’s not to say we won’t be getting all these things and more with a world of developers tinkering with the code instead of just Google engineers. But did Google set themselves back a bit by releasing too early? Its highly doubtful the Netbook makers will shun the OS. In fact, I don’t think Google will have any problems at all getting people to use it. But their releasing Chrome OS this early is indicative of Google adopting classic Microsoft-style tactics. That being by releasing a premature product you get market share and mindshare by stunting the growth of more mature comptitors products. OS/2 Warp anyone?

Getting Out Of Debt: An Update

In our quest to get completely out of debt within 3 years we’ve been actively evaluating options. On option we hadn’t really considered was selling our house. Given the current state of the housing market (especially in the Denver metro area) we didn’t think we could do anything but lose money which we didn’t want to do.

The other day I happened to check the latest Zestimate at Zillow. Curiously it said some comps in our area had sold fairly well. Enough so that it might be possible to sell without losing money. Wouldn’t make any either but thats not necessarily bad.

Some might say that it is necessarily bad. We’ve been in this place for five years and selling without a profit would be for naught. I disagree. First, we’ve had a nice tax deduction for the past five years. Also, had we been renting all this time we wouldn’t have anything to show for it. Not even a tax deduction.

After talking it over we decided to contact our Realtor and have her do a market study. After doing so and talking to another agent who also happens to represent the builder of our place she informed us gloomily that we probably could only ask for about $1000 less than what we originally paid. Except to us that wasn’t gloomy news, it was actually better than we had expected. FAR better. Helped by the fact that we had put a nice chunk down as the down payment when we bought as well as having give years worth of principal paid down.

So it turns out we will be able to walk away with enough cash to pay off most of our non-mortgage debt. Yay!

Yeah, yay but the best part is going to be when we can give Wells Fargo the big fat international symbol for “GFY” and no, I don’t mean “Good For You!” Over the past year they have been actively screwing us over. I’ll get into more detail in another post but believe me when I say that I would rather slide down a fifty-foot razor blade into a vat of alcohol and dry myself off with a towel made of salt than ever, ever do business with Wells Fargo again.

But that will leave us at zero right? Well, yeah, kind-of but zero is a lot better than negative. Plus, with no debt we’ll be able to sock away cash for a year or so and then use that as another nice down payment on another house. A house which all indicators suggest will be at a relatively low asking price.

So the moral of this story is to never rule out options for getting out of debt. Run the numbers! And wish us luck that this place doesn’t sit on the market too long.