Saw the horrible Judd Apatow movie, "This is 40", the other night. The husband and wife have a massive underwater house, cars, i-everything, screaming kids, personal trainers, leeching parents, a surprise post-40 pregnancy of their own, and two businesses that are failing. The full American catastrophe.
https://www.youtube.com/watch?v=cHAqdZ2f5cM
The husband (Pete) owns a music label and produces an album for the fading rock artist Graham Parker in a last ditch attempt to pull out of the tailspin. When Pete explains to Parker that the album is a failure, Parker's ERE response is classic...., "I’m going to be fine. Secret is, make sure you have a small nut. That’s the key to life."
http://www.urbandictionary.com/define.p ... your%20nut
Seems there are two types of ERE. Big nut and small nut ERE.
What do you think?
Big Nut or Small Nut? The Key to Life.
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secretwealth
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There was an article on Bloomberg about a banker who was struggling to keep afloat on $350k a year. Key quote: “The New York that I wanted to have is still just beyond my reach.” The headline is hysterical and infuriating: http://www.bloomberg.com/news/2012-02-2 ... -chex.html
So many people are chasing a lifestyle that they want or think they want, and see anything less as failure. Jacob does a good job talking about this in the book when he points out that people who fantasize about being a millionaire think about how they'd spend the money, not how they'd save to get there.
So many people are chasing a lifestyle that they want or think they want, and see anything less as failure. Jacob does a good job talking about this in the book when he points out that people who fantasize about being a millionaire think about how they'd spend the money, not how they'd save to get there.
I thought that movie was funny. It reminds me of some couples I know sadly enough.
I guess I called the movie horrible because it is literally painful for me to watch people crash and burn. I remember back when Tom Wolfe's book, "A Man In Full" came out I was really looking forward to it and actually bought a hardback copy. I thought I was going to devour it but I found myself so disturbed by the characters financial and lifestyle disintegrations that I had to put it away for a while before coming back to it. Great ERE book by the way.
SW that article is proof that there are still real writers who report. It's a time capsule. Beautiful.
I guess I called the movie horrible because it is literally painful for me to watch people crash and burn. I remember back when Tom Wolfe's book, "A Man In Full" came out I was really looking forward to it and actually bought a hardback copy. I thought I was going to devour it but I found myself so disturbed by the characters financial and lifestyle disintegrations that I had to put it away for a while before coming back to it. Great ERE book by the way.
SW that article is proof that there are still real writers who report. It's a time capsule. Beautiful.
My father-in-law has lived this philosophy his entire life. He's 81, but the only debt he's ever had was $1,500 he owed for several head of cattle he mistakenly bought at an auction when he was 17 years old. His father bailed him out and the money was paid back when the cattle were sold in 18 months, but he said he was "sweating bullets" during that time. He only buys things if he can pay cash. He's strict.
My favorite quote from him: "You don't want to be paying the bank; you want the bank to be paying you."
He paid for 3 kids to got to college in cash and now he supports 3 households because he's the only of the 3 brothers in the farming partnership still able to work on a daily basis. But they were even more strict with their money, so they are all doing fine.
My favorite quote from him: "You don't want to be paying the bank; you want the bank to be paying you."
He paid for 3 kids to got to college in cash and now he supports 3 households because he's the only of the 3 brothers in the farming partnership still able to work on a daily basis. But they were even more strict with their money, so they are all doing fine.
"Seems there are two types of ERE. Big nut and small nut ERE."
I agree, but see it as a continuum. Basically, as long as you've got enough coming in in passive to not need work in active, you're set, whether you're spending $1,000,000 (or more) a year or $1000 (or less).
My FIL and I both buy cars every few years (although we've apparently both slowed down a bit). His are in the ballpark of 25k, while mine are in the ballpark of 1-2k. On the surface, we might not appear to have anything in common in our purchases. However, we both buy in cash, which, in my opinion, makes all the difference.
Something else I've always said is that you can afford something when you know you could buy another one exactly like it tomorrow if it broke today.
I agree, but see it as a continuum. Basically, as long as you've got enough coming in in passive to not need work in active, you're set, whether you're spending $1,000,000 (or more) a year or $1000 (or less).
My FIL and I both buy cars every few years (although we've apparently both slowed down a bit). His are in the ballpark of 25k, while mine are in the ballpark of 1-2k. On the surface, we might not appear to have anything in common in our purchases. However, we both buy in cash, which, in my opinion, makes all the difference.
Something else I've always said is that you can afford something when you know you could buy another one exactly like it tomorrow if it broke today.
I agree, but see it as a continuum. Basically, as long as you've got enough coming in in passive to not need work in active, you're set, whether you're spending $1,000,000 (or more) a year or $1000 (or less).
Reminds me of Talebs nonlinearity of probability of harmful events. Bigger is more fragile.
Reminds me of Talebs nonlinearity of probability of harmful events. Bigger is more fragile.
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jacob
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In systems design, there are four aspects that increases failure rate:
1) Size
2) Speed
3) Complexity
4) Coupling
These same four things are, unfortunately, also an indicator of what's possible to get done, a faster machine does more. A bigger one does more, etc.
The middle class has mainly prioritized size, speed, and coupling. ERE prioritizes complexity.
1) Size
2) Speed
3) Complexity
4) Coupling
These same four things are, unfortunately, also an indicator of what's possible to get done, a faster machine does more. A bigger one does more, etc.
The middle class has mainly prioritized size, speed, and coupling. ERE prioritizes complexity.
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jacob
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@Ego - Yes, but don't confuse complexity with coupling (relatedness).
Given equal coupling, if a solution depends on more parts to be valid, then the chances of failure go up with the number of parts.
It's harder to keep a car going than it is to keep a bike going which is harder still than keeping the feet going.
Given equal coupling, if a solution depends on more parts to be valid, then the chances of failure go up with the number of parts.
It's harder to keep a car going than it is to keep a bike going which is harder still than keeping the feet going.
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jennypenny
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Ugh, I'm lost again.
So, which is better (assuming 3 sources of income)?
A
1. I write for a newspapaer
2. I write for a magazine
3. I do editing on the side
B
1. I write for a newspaper
2. I rent out a second home I own
3. I do some stock trading
I would think B, but now I'm confused. B means varied sources but A means fewer skills and resources needed.
So, which is better (assuming 3 sources of income)?
A
1. I write for a newspapaer
2. I write for a magazine
3. I do editing on the side
B
1. I write for a newspaper
2. I rent out a second home I own
3. I do some stock trading
I would think B, but now I'm confused. B means varied sources but A means fewer skills and resources needed.
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secretwealth
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I think the answer is it really depends. How many extra resources does it take to learn the varied skills for subset B, and will that offset the lower risk profile relative to subset A? And how much risk are you willing to tolerate?
I don't think any one answer will work for everyone. Grand theories have limits.
I don't think any one answer will work for everyone. Grand theories have limits.
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jacob
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@jennypenny - You're also mixing up complexity with coupling.
Find an example that has the same level of coupling but different degrees of complexity, e.g. it's better to be paid $40k slacking off as a technical assistant than being paid $40k as a publish or perish researcher.
What's less fragile: a brace or a power drill?
Find an example that has the same level of coupling but different degrees of complexity, e.g. it's better to be paid $40k slacking off as a technical assistant than being paid $40k as a publish or perish researcher.
What's less fragile: a brace or a power drill?
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jennypenny
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I think I understand the difference between coupling and complexity, and why complexity would increase the chance of failure.
But...why doesn't coupling do the same thing? If all of a person's income sources are related, isn't there more of a chance of all of them drying up at once if an industry is hit hard?
I guess I don't understand why the chance of failure with complexity is greater than the chance of failure with coupling. Or is that not what you're saying? Are the risks equal?
But...why doesn't coupling do the same thing? If all of a person's income sources are related, isn't there more of a chance of all of them drying up at once if an industry is hit hard?
I guess I don't understand why the chance of failure with complexity is greater than the chance of failure with coupling. Or is that not what you're saying? Are the risks equal?
It's harder to keep a car going than it is to keep a bike going which is harder still than keeping the feet going.
This is part of why we just bought a reel mower. It cost more than our used gas mower, but with the reel, it won't cost a gallon of gas to run it, occasional spark plugs, oil changes, oil filters, and air filters, a new blade and sharpener that we were about to buy...etc. That doesn't even go into the environmental, auditory, and safety benefits.
It's also why I'm much more willing to work on my car (a 90s subcompact) than my wife's (a 00s midsize). My car has a smaller engine, fewer parts, and is less intimidating to get under and inside. My wife's car's engine bay just looks like a maze in comparison.
This is part of why we just bought a reel mower. It cost more than our used gas mower, but with the reel, it won't cost a gallon of gas to run it, occasional spark plugs, oil changes, oil filters, and air filters, a new blade and sharpener that we were about to buy...etc. That doesn't even go into the environmental, auditory, and safety benefits.
It's also why I'm much more willing to work on my car (a 90s subcompact) than my wife's (a 00s midsize). My car has a smaller engine, fewer parts, and is less intimidating to get under and inside. My wife's car's engine bay just looks like a maze in comparison.