Simo jumps out of burning platform

Got a job from Helsinki. Death cab for Qt now chugs on without me. I travel to work on rails (=by train) to work on Rails (=a web programming stack.) Now I have provable regular income to get a mortgage and actually move to Helsinki.

Finally, a picture of Ruby:

A true story of grit in education and life: The complex analysis class of 1999

Summary: Grit is the character trait of persisting in the face of hardship. My high school class faced an unintentional test of grit. Life outcomes differ starkly between the 4 who passed and the 12 who didn't.

The grit scale

Duckworth's grit scale is a short self-assessment quiz for persistence, with questions like "I finish whatever I begin" or "I often set a goal but later choose to pursue a different one." It has been tested to work immensely well in the military:

Duckworth and her collaborators gave their grit test to more than 1,200 freshman cadets as they entered West Point and embarked on the grueling summer training course known as Beast Barracks. The military has developed its own complex evaluation, called the Whole Candidate Score, to judge incoming cadets and predict which of them will survive the demands of West Point; it includes academic grades, a gauge of physical fitness and a Leadership Potential Score. But at the end of Beast Barracks, the more accurate predictor of which cadets persisted and which ones dropped out turned out to be Duckworth’s 12-item grit questionnaire.

(HT: Steven Hsu, Aretae)

The complex analysis class of 1999

Päivölä is a math-oriented high school. Before entry, candidates are screened for mathematical aptitude. The special sauce of the school were university-level math courses. Initially all 16 of us attended unimath. The school was still in formation: We were just the second boarding year-class there. Teaching was a bit shaky and there were few exercise sessions. Consequently students kept dropping out of unimath. The school was designed to teach the top as much as they could handle, so little was done to address those who dropped out. It was an unintentional test of grit: persisting despite woefully inadequate background and few exercise sessions.

In the last spring, there were 5 people in unimath: me, Vesa, Tuomas, Mikko and Jussi. The final course taught complex analysis. I was the last one who dropped out of unimath. At that point, 1/3 of the course had passed and I was completely dropping out of cart at lectures, not understanding much anything.

It was preceeded by 6-month limbo of linear algebra and calculus. During the limbo, lack of preliminary knowledge and mathematical maturity meant increasingly severe dropping-outs (not understanding anything about the taught topic). The first lecture where I completerly dropped from cart was about QR decomposition and numerically more stable way to solve linear equations, so complex analysis dropping-out was anything but surprise or whim.

This divided the class into 4 who passed the grit test, and 12 who didn't. It was not just about talent, because everyone had been screened at entrance.

The wall of abstraction

CS lore describes programming students "hitting the wall" during teaching. Some understand the subject swimmingly, while others struggle even after explanations. Some consider this "IQ in action": Either you have innate ability to get it, or you don't, in which case you need a lot more exercise to learn it.

Little research has been done about this. Dehnadi and Bornat assumed that setting a variable is one such wall. They measure one's grasp of variable assignment with questions like below.



The students had not yet been taught programming, so it was enough to use any consistent mental model. For example, the mental model "assignment moves the values from left to right" produces answer "a=10, b=10". The consistently wrong need to learn just one thing to get all correct.

44% answered the test consistently, and the test predicted well if the students would pass or fail their first programming course(*):



(*) Some attempts to replicate failed to find correlation, and a meta-analysis with improved test protocol found clear but weaker correlation.

Hitting the wall

The first time I hit it was at a physics lecture. A visiting Russian lectured about mechanics. Unlike in earlier lecutres, there were no numbers involved: the masses of the objects were m and M. I had all the required background (high school mechanics; math problems without numbers) but still couldn't answer a single exercise. Afterwards, I heard others commenting happily that at last someone was lecturing things properly. Before that, I had always been on the other side of The Wall, delighted to skip slack.

Life outcomes

Out of the 4 gritty and talented ones, 75% are now in managerial roles. Vesa is a vice president at Pohjola Insurance. Mikko has worked for 6 years in various managerial roles in Nokia. Tuomas is an assistant professor and has 30 publications. The only remaining professional is Jussi, but he is quite short (under 160cm). Jussi still has a PhD degree, so he is not a total loser even by the yardstick of this group, unlike me.

Only 25% of the remaining 12 ones have done well in career. Jani already had industrial-strength programming skill when he entered the high school at age 15, so he was right to ignore the class. Tarmo and Tommidefy the complex analysis cutoff limit.

Too lazy to work, too chicken to steal

Summary: This post tells a formula for deciding when to quit your day job.



First we define Enough money. It is the monthly sum, which allows you to buy most things you want, so that not working increases your standard of living more than extra income from your day job.

Mortgage is such a huge factor that we exclude it from Enough and account it separately as Debt Costs. It covers both interest and repayments.

Secondly, we assume that investments are the basis of your new income. Investing is the only way to pay once and get money back for the rest of your life with minimal effort, either as dividends, interest or rent. Historically 4% withdrawal rate has proven robust. Even after you spend 4% each year, your pot still grows enough to resist inflation. We also assume 25% tax rate, which is the average of dividend and capital gains tax rates.

You can quit your day job when:
Debt Costs + Savings / 12 * 0.75 * 0.04 + Side Income >= Enough
Debt Costs + Savings / 400 + Side Income >= Enough

Notes about the formula:

• You need to own 400 euros to get 1 euro of monthy income. 400 comes from multiplying the constant factors. Only with compound interest and lots of waiting is it realistic to get these kinds of multipliers.
• To get there quickly, you need side income schemes. For example €100 of monthly ad income from a blog corresponds to €40000 of savings. While writing interesting content is hard, it is probably easier than to save €10000/year for 4 years.
• Side income schemes also provide cover, if you have to explain, what you did for the past few years.
• Cheaper apartment speeds up the plan by years. There can be €100000 difference in apartment prices between Helsinki and Oulu city centers. If you value big city life, you probably prefer working to idle life in Oulu. Debt Costs depends very much on your lifestyle.
• If you are near retiring, you can withdraw more. Multiply your monthly pension by 400 to see how much less you need to own at retirement.
• If side income raises the sum past Enough, you should save the difference to gradually phase out the necessity of side income schemes. Otherwise, you either are not lazy enough for this plan, or have set Enough sum too low.
• Enough sum raises with inflation.

Work and idleness 4/4: Individualist take

If it's not personal what you do for 40 hours a week, then what is? Individualism has two sets of attitudes towards work.

The ideal condition is to do what you love. This is based on the idea that you should express yourself and reach your potetial. Your unique life is an identity project, where you work towards reaching your highest potential.

For the rest of us, work is just a way to earn money. Self-actualization is pushed to leisure, for example holiday trips. Work is a little despicaple sign of slave mentality and lack of wealth, visible in phrases like "office drone" or "grease monkey". It is the opposite of life. How tough guy you are is measured by how much money you get, how much ass you kick and how little you give to others.

For both earners and self-actualizers, the impact of work on others is irrelevant.

Individualists admire people who have found "cheat codes of reality" and don't need to work, for example poker professionals, and also people who game the system to distribute income to them.

Problem: Free riders

Societies embracing individualist attitudes run into problems, when having a work ethic becomes contemptible. Not everyone can be idle.

Most people seem to follow individualist work ethic. Citizens vote governments, which allow them to free ride on social benefits, which are never high enough. Governments take debt to fund social spending. Sovereign debt crisis follows.

Work and idleness 3/4: Transhumanist take

During the last 200 years, technology has lifted the Western masses from rags to affluence. The logical end of this trend is Iain Banks' Culture, where robots do all the work, but we are not there yet. Work should maintain and improve the standards of living and guard against risks like nuclear war, which may stop us from reaching singularity. Workers can be classified based on whether they advance this goal.

Maintainers keep the system running at current level. For example postal workers maintain capability to send packets, and soldiers guard against foreign army burning down the nation. We would notice very soon if these people stopped working.

Improvers make technological and political progress happen. For example researchers may develop a cure for cancer, or a politician may remove a wasteful regulation. We would notice big difference in 20 years if these people stopped working.

Leeches neither maintain or improve other people's standards of living. This includes not just people who live on income transfers (it doesn't matter if it comes from state or from dividends of inherited wealth) but also workers who have little impact. We wouldn't notice any difference if these people stopped working.

In the long run, more and more people can neither maintain nor improve standads of living better than robots. In that case it's ok to relax and take it easy, but anyone reading this blog can't use stupidity as an excuse.

Virtues: Efficiency and enlightenment

Technology enables "hard" efficiency, for example food production no longer requires 50% of the workforce to labor at farms. This frees resources also to "soft" wants and needs, like better human rights, social safety net, education, healthcare etc. No matter if your values are hard or soft, efficiency powered by technology delivers it. (But it doesn't deliver relative wants, like being wealthier than the Joneses.)

Politics must ensure that greater efficiency does not translate into more efficient slaughter in gas chambers, etc.

Enlightenment and knowledge help spot opportunities to organize things differently.

Problem: It's not possible to be the only transhumanist around

It is practically impossible to talk with most people about transhumanist impact of work. It is too abstract topic for someone who usually talks about cars and apartments. Also most people only care about how much they and their ingroup get, making it heresy to talk about outgroup's interests. People with a mortgage and a family to provide for couldn't care less if a project produces nothing and it is clear from day 1.

Nowadays transhumanism is to me mainly quiantly naive idealism of the youth.

Still haven't bought any stock

Summary: This post tells a formula for deciding if you should postpone purchases in times of a looming crisis.

Update: Added a paragraph on probabilities.

After I finished reading Saarion sijoituskirja, the Arvopaperi OMXH index showed that Finnish stock prices had moved -10% since 1.1.2011. I postponed purchasing stocks because of the following calculation. It had two scenarios:

(1) Greece crisis becomes acute with probability P(crisis).
(2) Orderly recovery happens with probability P(recovery) = 1 - P(crisis).

Let the change in stock prices be C(crisis) or C(recovery). We should postpone purchases if

P(crisis) * C(crisis) + P(recovery) * C(recovery) < 0

When Lehman Brothers collapsed, the prices decreased by 40%. Let C(crisis) = -40%. By contrast C(recovery) = 10% - 20% since recovery is usually slower.

Avoiding probability estimates

We can pick stock price changes from historical data. Regarding probabilities, let's look at the equation at 0 when it doesn't matter whether we postpone investment or not.

P(crisis) * C(crisis) + (1 - P(crisis)) * C(recovery) = 0
P(crisis) * C(crisis) + C(recovery) - P(crisis) * C(recovery) = 0
P(crisis) ( C(crisis) - C(recovery) ) = - C(recovery)
P(crisis) = C(recovery) / (C(recovery) - C(crisis))

With C(recovery) = 15% and C(crisis) = -40%, the equation gives P(crisis)= 15% / 55% = 27%. This means that we should postpone investment, if we estimate that P(crisis) > 27%. We should invest now if we estimate that P(crisis) < 27%. It doesn't matter if we invest or not if we estimate that P(crisis) = 27%.

How it turned out

What in fact happened was that Greek crisis materialized but it was an orderly restructuring and prices collapsed only by 20%. The debt and the budget deficit are still simmering.

The situation now is almost the same, but the 'risk scenario' is 2008-style banking crisis. Only this time, goverments are part of the problem and no longer part of the solution. I'm still postponing investment.

If stock prices recover from current -30% to -10% in the next 3 months, then I suck at predicting and am better off investing to index funds. Stock traders divide profit to 'alpha' and 'beta'. 'beta' is the profit from market. You get beta profit from index funds, because stock prices on average rise with economic growth. 'Alpha' is the profit from skill. It is negative if you suck at predicting. Finding your own alpha by making successful and failed predictions is called alpha discovery.

S&P lowers US credit rating

Now Kaalimato has higher credit rating than US.

Prize for screening out mass killers

Legal weapons were used at Jokela and Kauhajoki school shootings and Oslo attack. The shooters had to get gun license first. The permitting process provides a checkpoint for screening out potential mass killers. Currently no effective screening exists to separate mass killers from the responsible and sane; therefore a prize is neeeded to give psychologists, criminologists and medical professionals incentives to create a test to screen out mass killers.

The prize would be based on pessimistic assumptions:

• There are going to be more mass killings. Ways to prevent mass killings are not known.
• Special brain function is needed for the monstrous lack of empathy which enables mass killings without war trauma, or delusionality where the murderer thinks he is an action hero tasked with saving the world by killing masses of nameless goons.
• This brain damage may show up in hormone levels, genes regulating brain function, etc.
• Shooting back is an effective way to stop an ongoing mass killing, for example Hyvinkää shooting stopped after the police returned fire. Effective screening paves the way for responsible and sane armed population. Should mass killers move to illegal guns (most regular gun kills are already done with illegal guns in Finland) then damage control through concealed carry permits is the only effective measure.

Genetic information already improves estimates about propensity to violence. The Finnish permitting process already screens out 2/3 of the criminals who would kill.

Update: The author of the linked article got his statistics wrong. He compares people with gun license killing with guns they own against kills by people without gun license using all methods. Gun kills are just a fraction of all kills, so it is an apples-to-oranges comparison.

Rules for the screening tests:

• The tests can be based on any set of physiological measures like blood sample, genetic profile, saliva, urine, body height, etc.
• The tests consist of a scoring algorithm for calculating pass/fail and a list of physiological measurements.
• The tests can announce false positive for at most 10% of the population.

How prize money would be distributed:

• After a mass killer is caught alive or dead, available physiological measures are taken. This enourages tests, which can be performed on the dead like blood samples, genetic profiles etc.
• After each killing incident, 20% of the prize money is given for the tests which were positive for the killer. 80% remains in the fund for future killings.
• The number of false positives is inversely proportional to the prize money. For example, a test flagging 0.01% of the population earns 100 times more than a test flagging 1% of the population.
• Because of moral hazard, any research team with any links to the killer can't get prize money.

Here is an example of prize money division. Suppose that after a mass killing incident, two tests flag the killer. One of them flags 1% of the whole population, while another flags 0.01%. The price pot is 100000€, so 20000€ is awarded. The test flagging 0.01% of population earns 19802€, while the test flagging 1% of population earns 198€.

The institute administering the test would have to be international to get adequate sample size. It would also publish all physiological measures about the mass killers, and preferably also from other violent criminals and some voluntary controls without criminal record.

Without trying arrangements like this prize, we'll never know if modern psychology can screen out potential mass killers. What can be lost by trying?

About The Book

Summary: Breivik's book contains several fabricated statistics. This casts doubt on the truthfulness of his autobiographical claims.

ABB did not just reach wrong conclusion - namely, that political terror works. It doesn't. Even the Soviet communists who fought a civil war to gain power found terror strikes counterproductive.

His book is also worthless as a reference on the state of Islam and moral decay in Europe, as it is full of fabrications and factual errors. This is a pity as I'd very much like to see a well-researched "big picture" overview without liberal "don't worry, everything is ok" head-patting. I cross-checked some statistical claims about Finland.

The first claim which caught my doubt was the claim in p. 1173 that 35% of Finns get a sexually transmitted disease in their lifetime. Turns out that 15% of Finns had contracted an STD in their lifetime in 1992. Chlamydia was just as high in 1987 as in 2003, gonorrhea almost vanished and others are too small to meter, casting doubt on that 35% figure.

At p. 564, a table lists the Muslim share of the population for various European states. It claims that in 2009, 2% - 3% of people in Finland were Muslims. Wikipedia puts the estimate at 0.8% in 2006. This is a horrible mistake, as the whole book is about the Islamization of Europe

At p. 719, there is a discussion of social capital and trust, and claim that Norway, Sweden, Denmark and Finland top the list. This claim is true.

At p. 735, there is a table quantifying the levels of multicultural indoctrination in each country. The chapter doesn't tell how the numbers were calculated nor cite references. Conclusion: fabricated.

In p. 923, they put the level of Muslims in Finland at 2% - 4% of the population rather than 0.8%.

In p. 972, there is oil production amounts in different countries. The figure
is in line with an online source. Also other figures in this chapter seem factual.

At p. 1190, he claims that the "historic concentration of the Nordic genotype" in Finland was 85% at 1900, 75% at 1950, and 55% at 2010. Again there are no references or description of what is "nordic genotype". I seriously doubt if the genetic makeup of Finns has changed by 30% in 100 years. We haven't had that much immigration.

At p. 1223, there is a table listing countries in order of GNP. While the list seems genuine, it is interpreted wrong. He says "The International Monetary Fund ranking of the countries with highest GNP shows that the top 10 list is dominated by countries with an exceptional degree of social cohesion." The real conclusion from the table is that there are many ways to get high GNP per capita. 3 couuntries have oil. 3 countries have high social cohesion. Good capitalist economy has brough US and Singapore to the list. US is the antithesis of social cohesion and still on the list.

Conclusion: 2 figures don't match with official ones, 2 figures seem outright fabricated as there is no methodology mentioned, 1 is true but sloppily interpreted.

Social proof

What about his autobiographical claims? In his communication tips, he emphasizes the need for social proof and looking good: "...it should be a priority to appeal to a broadest selection of European males. Resistance leaders/cell commanders or individual cell operatives must prioritise to arrange and book a professional photo session prior to operation for one or all involved. Resistance leaders of larger networks should also arrange photo sessions with female patriotic models to use in online marketing/recruitment campaigns."

And he sure looks good himself! It reads like straight from Mystery Method. He was a leader of men, running a software company in early 2000s and a distinguished WoW raiding guild in 2005. But the guild he named was actually established only in 2007.

His tribe was also preselected by women: "Although I have had a change of mentality a majority of my friends have not. My stepfather Tore, one of my best friends Marius and my more distant friends Kristoffer, Sturla and Ronny are all living manifestations of the complete breakdown of sexual moral. All five have had more than 300 sexual partners (two of them more than 700)."

Finally, he's protecting us, his loved ones, from the threat of Islam.

Work and idleness 2/4: Conservative take

Someone needs to keep the wheels of modern society running. In conservative ideology, work is a burden and everyone has a duty to carry their fair share. This is achieved by (1) stigmatizing free riders and social bums, (2) exalting work and and by (3) making work tolerable and pleasant with institutions (for example work regulations enforcable in court) and social norms (for example 40-hour work week).

Warning Against Idleness in Saint Paul's 2nd letter to Thessalonians illustrates (1) and (2) perfectly:

... keep away from believers who are living in idleness and not according to the tradition that they received from us. ... we were not idle when we were with you, and we did not eat anyone's bread without paying for it; but with toil and labor we worked night and day, so that we might not burden any of you. This was not because we do not have that right, but in order to give you an example to imitate. For even when we were with you, we gave you this command: Anyone unwilling to work should not eat. For we hear that some of you are living in idleness, mere busybodies, not doing any work. ... Take note of those who do not obey what we say in this letter; have nothing to do with them, so that they may be ashamed. Do not regard them as enemies, but warn them as believers.

The problem with the conservative position is that it no longer matches reality. The Finnish employment rate - the percentage of people aged 16 - 64 who work - was 69% in 2010. Let's assume that nobody under 16 or over 64 works, and that all age brackets contain just as many people, and that the average lifespan is 80 years.

We get that [ 16 * 0% + (64 - 16) * 69% + (80 - 64) * 0% ] / 80 = 41% of Finns work.

It is bullshit to claim that 59% of Finns can't work. My sister was getting paid for watching children as a young teen. I got my first IT summer which included some programming at age 18. But if you ask the credentialists, both work tasks absolutely require a college degree. Also in the countries where pensions are low, old people sure find stamina to work for some supplementary income.

People have made a collective decision to work less as most people get a nice standard of living anyway.

Work and idleness 1/4: The story of AZ

In Soininvaara's blog, alias "AZ" poked a beehive by admitting that he bums on last resort income out of his own choice, without any sickness or attempt to become employed. When reading this, my first reaction was "why in the hell am I slaving away at the company for 40 hours a week, when he gets for free 960e a month, which is less than I sometimes spent in the most busy months!? What's in it for me in being employed?"

In June, the housing benefit + last resort income was 959,11 euros. The rent 540. For spending 419,11 euros remain. The electricity bill is fully paid by social service agency. Water is included in rent. There are no medical costs, but they would naturally be fully compensated.

With 119 euros you can eat well foodstuffs like porridge, rye bread, carrots, pea soup, soy sauce, pasta etc. If I want to save for something, only those are necessary. It only costs a few euros to buy soap or bags for the vacuum cleaner. What could possibly be necessary expense for those extra hundreds of euros? What's so superhuman in saving them? In my opinion it would be alarming, if a healthy person couldn't live like that for a few months. I'm not addicted to cigarettes. In two months I saved 600 euros. That's a royal sum for example for wandering in Lapland, as I already have equipment from the previous trips.

I have so much experience on what it means to live on the above mentioned benefits and even with reduced benefits down to 250 euros a month that without some specific health issue which the state refuses to refund I simply cannot sign the claim about extreme material poverty of those who live on benefits. It simply isn't true.

The last resort income requires that you don't have significant property, for example a house; however, you can own a house. This is a possible lifestyle choice for someone who has paid his house already, and wants to drop out and commit hikikomori, expecting that life won't offer many opportunities anymore, for example for me if I fail to up my seduction skills by age 40.

Az says he has Asberger's syndrome and his explanations about philosophical research task reek mild crazines; this tunnel vision phenomena is familiar to me from the days of Finnish Annotator. Watch carefuly for it's cunning, devious bite if you ever become idle for extended periods.

Simo the unemployed

The writing was on the wall since Elop's announcement. Back then, the number of projects had already decreased. I had plenty of time to sketch scenarios. The only surprise was timing: the customer was still paying my salary when I got laid off last week.

Plan A: Get a Java programming job from Helsinki

Why Helsinki? My brother and sister moved there within a year. There are 10 times more open programming positions in Helsinki than in Tampere.

Why Java? It was already going strong in 2007 when I was searching the previos job. It is likely to stay relevant also to 2015. Even if Java becomes obsolete, the whole web stack from SQL servers to browsers won't change in one punch. Java is my second strongest language after POSIX C / Symbian C++. The wanted skills in the job ads are suprisingly similar as in 2007 - SQL, Hibernate, Spring, JSP, JSF and various application servers are still going strong - and only Liferay and jQuery are completely new.

Actions taken: Sent job applications, got some books on jQuery and J2EE.

Plan B: Play time by starting a company

The basic idea is to warm up some leftovers from the website I developed in 2005-2006, but with much clearer goals and much better focus on what I am going to sell and to whom. The software would be distributed as an applet which runs in browsers.

The first phase is to develop a free prototype with limited content, to put it online and advertise it a bit. This way, I would find out the number of users a month. With reasonable assumptions about the conversion rate (how many visitors would buy the full version) this gives an estimate of market size and income potential. Is there enough demand for me to make a living out of it?

If there is no demand, then I would get a real job. If there is mediocre demand or the data is ambigous (most probable scenario) then I could spend 6 - 12 months developing the full version. The upfront initial investment would be paid back over many years as a trickle of side income. This way, I could play time until the Finnish IT job market clears out after 1500 laid-off Symbian engineers from Nokia and comparable amount from subcontractors.

Because of Plan B, I have almost no incentive to get a new job quickly. The only thing I want but can't do on income-based unemployment benefit is to buy a house in Helsinki.

Actions taken: I've been unemployed for 4 days and have been developing the prototype in 3 of them.

Important announcement

I have nothing to say, and I'm drunk saying it.

I am also self-centered as I write mainly about things concerning my own life and myself, probably a mild narcissist or a mild psychopath.

True satanic black metal

Although this video proves the worst nightmares of Ironmistress, these guys are our last, best hope against the imminent coming of Islamic theocracy!

Trip to Norway

A fountain in a park near National Theater.

A street in Oslo.

A haunted soul was trapped to the wall of National Theater subway station.

Flytoget between Oslo and Airport was new and shiny.

When I arrived at 01.00 AM to Oslo railway station, the demographic I saw around me was 50% non-white, mainly young middle eastern and black faces. Why would any country opt to let in such amounts of immigrants from Africa and Middle East, when they are known to increase crime, welfare payments, white flight and in the worst case neighbourhoods where the police can't enter? Especially as demographic changes can never be rolled back once they have happened.

In the daylight it was a beautiful Nordic city, with lots of scenic spots I had no time to tour because the schedule was very busy.

The oil money was visible everywhere. The prices were expensive: The train from Oslo Airport cost 22e, and a tram ticket cost 5e, which is quite much. The train had screens displaying news and stock prices. The train seats had misleading investment ads, where a silver vendor told that silver has produced the highest return on investment during the last few years. There are many investment banks in Oslo.

Compound interest

Early retirement is not my goal, since I don't have these kinds of sums to spare. However, it is a common goal in many investment blogs and a fun scenario to speculate.

This calculation is from Coder's investment blog. You save 10000€ each year and get the historical stock market average return of 8%. It doesn't take inflation into account.

1. year: 10 000,00€
2. year: 21 600,00€
3. year: 34 128,00€
4. year: 47 658,24€
5. year: 62 270,90€
6. year: 78 052,57€
7. year: 95 096,78€
8. year: 113 504,52€
9. year: 133 384,88€
10. year: 154 855,67€
11. year: 178 044,12€
12. year: 203 087,65€
13. year: 230 134,67€
14. year: 259 345,44€
15. year: 290 893,08€
16. year: 324 964,52€
17. year: 361 761,68€
18. year: 401 502,62€
19. year: 444 422,83€
20. year: 490 776,65€

Notes about the series:

• In the end, the yearly gain is 40000€. The tax percentage is about 27% (assuming 1/3 dividend income with tax percentage 20% and 2/3 capital gains income with tax percentage 30%.) This is quite well-off.


• In the beginning, savings dominate. The faster you can save the first 100000€, the better. Speed up the process by living with austerity for some years.


• In the end, interest dominates. Around year 10, interest and savings provide equal boost to capital. At year 15, you might just as well stop saving and concentrate on researching means to increase interest.


• If you take inflation into account, you have to wait a few more years. A comment in the original blog suggests 2% inflation, which would require waiting 4 more years to get the same real income.


• After 10 years, you can already live on 1000€ a month. Then again, social benefits allow that much faster at the next round of layoffs if that is what you want to do with your life.


• At around year 15, getting laid off is a lottery jackpot. With income-based unemployment benefit and stock-market gains together, you earn the desired yearly sum much earlier while waiting the compound interest to work its magic a little slower.


• If you plan to retire to a low-paid meaning-of-life work, the right time to switch is around year 12. At that point, the main thing left to do is to wait. Saving has little effect. You might just as well start the lifestyle adjustment, as long as you don't touch the capital.


• If you are near retirement, you need less. After retiring, you only need to make (desired income - pension). Before retirement, you can eat on capital as long as you still have enough at the point of retirement.

Why this is not my way

Social deprivation and lack of externally imposed structure would drive me crazy. I experienced some of it during the two summers spent writing my own website. I talked to other people once a week and went to sleep at 6am. I am the kind of dog who needs a little whip sometimes.

This calculation horrifies me and falls to the category "be careful what you wish for, since you might get it."

Riches and bitches

Summary: This post investigates myths and anecdotes, which link male wealth to sexual market value.

Suppose I found a way to get wealthy, but it required huge amounts of work.
Would it be worth it? Would it be progress towards my long-term goals in life?

Mere correlation is not enough

Ice cream doesn't cause drowning despite both being common during hot weather. Similarly tallness and good social skills help both popularity among women and promotion prospects to better paid jobs. Instead of correlation, we need to find out the mechanism through which wealth affects marrigeability. That are better described in anecdotes rather than statistics.

You can buy status symbols with wealth

The traditional claim is that wealth enables you to buy status symbols and status signals attract women. This does not stand much closer scrutiny.

On the small scale, signaling wealth by buying women drinks in a bar labels you as an exploitable dupe. I have noticed it myself that I am instantly dubious towards people who insist on giving things away, asking myself "What does he want in exchange? Am I now in an unwritten agreement, where he expects something unreasonable from me, starting drama when he doesn't get it?" Ritualized, reciprocal giving like a house party host making food to guests is an exception.

There is some evidence that big houses are beneficial. Years ago there was an article in NY Times where women rejected potential boyfriends after seeing their apartments. In a later chapter there is a personal anecdote about deriving benefit from a summer cottage.

Regarding cars and watches which lose half of their worth the moment you walk out of the shop we have another type of signaling problem.

Do you signal wealth or future time orientation?

People have different financial future time orientations (FTO). On the one end are the spendthrifts who live from hand to mouth. The other contains millionaire-next-door types who save most of their income and never spend it in their lifetime. Jantunen described the shades of grey last year.

According to research, couples with similar financial FTO have least arguments about money. Although short-FTO and long-FTO persons are attracted to each others as they remedy each others' weaknesses, their marriages are unhappy. If you become wealthy by being a tightwad, it is stupid to signal wealth by flashy cars and expensive clocks, since it attracts attention from wrong kinds of people.

	Short FTO	Long FTO
What to signal?	Wealth	Future time orientation, since wealth comes to the working thrifty in the long run.
What new cars, iPhones, etc. signal	The person is wealthy as he can afford it.	The person will not become very wealthy, if he wastes mediocre income on expensive consumption.
Used car, using coupon codes	The person is too poor to afford a better car.	The person is not wasting money when just as good cheap alternative is available.
Company having headquarters in run-down area	The company is not doing very well.	The company uses its money productively rather than on shiny surfaces.

This chapter concluded that signaling wealth by buying expensive items and services is a sucker's bet, so striving for wealth for this purpose is useless to begin with.

Personal experiences about the wealthy

Once I was in a meeting of relatives, where about 30 persons from three generations gathered for a weekend in a summer cottage. There were two millionaires present. Self-made man was an entrepreneur who had found a company and grown it organically to over 100 employees. His wealth was measured in tens of millions. Nokia millionaire had had a hard life when young. During post-war poverty he had learned the motto "Don't buy what you need, buy what you can't do without." Millionaire-next-door lifestyle enabled him to get into Hymy (a Finnish scandal sheet) list of Nokia millionaires in 2000. He wasn't a fool who puts all his eggs into one basket, so he probably owns a million euros now.

The self-made man also had alpha personality; he hosted the meeting in his cottage, and showed various expensive items in there (which he could well afford, as they took so small % of his income) and was also one of 2 skilled musicians in gathering. Before getting introduced to his wife, I first though she was one generation younger, so much effort she had seen to stay slim and good-looking.

The Nokia millionaire didn't seem to use his wealth to buy anything you couldn't get on average industrial worker's salary. His wife is fat and their relationship is not that good.

It seems that wealth increases sexual market value if you use it to play yourself into higher status positions, for example by hosting a party. Having wealth to put into apartments and summer cottages is an advantage, but we still have no evidence that non-real-estate spending increases male attractiveness. Without social skills, wealth is useless.

Wealth as an abstract measure of human worth

OkCupid Trends is a blog which posts data mining articles about the dating site OkCupid. They showed a correlation between male income and unsolicited contacts. Also in this Feissarimokat article high income in itself is an argument for male fitness. ("Mika tekee yli 100 000e vuodessa plus Nokian bonukset. Kummatkaan eivät olleet mitään tyhjäntoimittajia toisin kuin pari lusmua joita en nyt nimeltä mainitse...")

This is a genuine riddle: Women seem to value high income in itself, while not valuing "beta providers" who use that high income to buy them things.

Maybe what women really value is "millionaire personality" which is characterized by learning alpha behaviour from young age and working at management jobs which both pay well and signal high social skills. This would mean that wealth has to be accumulated at young age in order to have any effect on personality. This is in line with my personal experiences about the wealthy.

You can buy sex with wealth

This post is about attracting a spouse into a long-term relationship, so buying sex for an hour doesn't count.

According to Roissy, paying for sex because you can't get enough for free signals low attractiveness. Done regularly it definitely is a huge waste of money.

However, women's preference for preselection complicates the picture. Married men are twice as likely to visit prostitutes than singles. (Sources: A Finnish prostitute wrote that 75% - 80% of her customers are married while only 56% of men aged 30 - 65 in 2006 were married) It is possible that some character trait both makes men visit prostitutes and also makes them better at attracting spouses.

It definitely isn't wealth, as married men always say that family takes all their money. The character trait may be a well-developed dark triad. Or maybe not being fully dependent on wife for sex makes the husband less needy, making the marriage last longer.

Millionaire couples

Thomas J Stanley gathered statistics and interviews from American millionaries for his book. He found out that 90% of them are married. Marriages have lasted on average for 28 years.

This research is the polar opposite of Roissy. The couples co-operate to accumulate wealth and the men say that they couldn't have amassed the fortune without help from their viwes. It also confirms that the truly wealthy have long-FTO lifestyle rather than need to signal wealth. Instead of dumping the loser, the women tough it out with their men in times of hardship, leading to success in the long run. This is so different from what I hear from other sources that I doubt the honesty of this source.

Conclusions

The link between male wealth and marrigeability is highly muddled. Character traits which enable high earnings seem more important than the money itself. Different signaling systems for short and long FTO compilicate the picture further. Becoming a millionaire seems to get you married with 90% probability, but the anecdotes sound too good to be true, casting doubt on the reliability of the source.

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Before entering corporate world I thought that programmers build the systems of the information society. That the software I develop would have users. This way, my skill and work would have a positive impact on society. It wouldn't be glamorous but it would be meaningful.

Looking back at the last 4 years, only for 4 months did I worked on systems, which were delivered and had reasonable usability. Other projects were discontinued, kept going on and on without shipping date or were prototypes to begin with. One 8-month project was delivered, but with so lousy usability that people probably used other means to access those features.

This means that on average 1 month each year was spent on productive work. The only trace from the remaining 11 months are the numbers on my bank account.

Work with no external impact produces a nasty ethical implication: The duty ethic where you get paid for doing your job becomes meaningless.

Since I am a leech on society's resources anyway, I might just as well leech for maximal personal advantage: raising the generous Finnish unemployment benefit, learning how to transfer logical talent (talent in the biblical sense: advantages which God gave to you at birth for implementing His will on earth) from value-creating positive sum skills into zero sum stock market gambling while listening to satanic black metal and blowing the dividends on frivolous and inappropriate pole dancing hobby. This way, I would become one of those sinister "market forces" which make your life miserable with demands for efficiency, privatize gains and socialize losses, destroy the environment, spike your food with E-codes, make the police shoot demonstrators in Spain and worsen your salary and working conditions in the race to the bottom.

Summary: This post compares stock investing to mortgage.

This week I've been reading Saarion Sijoituskirja and considering investing into stock market.

First some background. I can't buy a house now for two reasons. Firstly, I expect to be laid off during the next year into a tight job market filled with 1500 Symbian programmers from Nokia and a comparable amount from subcontractors. This may mean a move to another city or country, creating a "push factor" away from Tampere. Secondly, there is a "pull factor" as my two siblings have recently moved to Helsinki.

My first lesson in investing

In September 2008, HEX index had collapsed 35%. I was going to an offshore assignment. I decided to buy stocks when they are cheap and moved a small apartment nest egg to a stock fund. The next week Lehman Brothers crashed, wiping away 40% of my nest egg.

I concluded that stocks are too volatile way to invest a nest egg, no matter how great average ROI they offer in 20-year timeframe.

In the hindsight, I made the right move for the right reasons, and the nest egg has recovered most of the melted value. Only timing was wrong: I should have spaced the purchases in 6 month intervals instead of trying to guess when the downturn is at the bottom.

Comparing stocks and mortgage

The biggest revealation I've learned from the book is emphasis on dividends. In the long run, the value of the stock is the time-discounted sum of dividends (price is something completely different). Companies pay on average around 5% of their share price in dividends. Dividend perspective also catches growth companies; they typically pay increasing dividends each year. This changes the picture in the following ways:

• You don't have to sell the stocks to use them to pay mortgage. Instead, you can use dividends for mortgage payments. Typically you want to buy a house during downturn and sell stocks during boom. Dividends can bridge the time gap.


• Temporary nest egg wipeout is not catastrophical. Debt-free companies continue paying dividends. Others resume after recession. Prices recover. In fact, selling stocks is strictly optional for a long-term buy-and-hold investor who is in for dividends and mortgage-length (20-30 years) timeframe. Of course, it is great for your wealth if you can sell high and buy cheap, outsmarting seasoned professionals, but don't count on it.


• Both houses and stocks "pay dividends" and "increase in value". In house, the 'dividends' come from lower living costs. Value increases typically in pace with inflation, at good locations faster. Statistically stocks produce a little more in the long run; then again, in the long run we are all dead.

Additional factors attracting me to stock gambling are:

• They have cute little numbers you can play with. Simple back-of-the-envelope calculations are a second nature to me. I do them almost instinctively. For example I "annualize" all costs by estimating, say, how many times a month I eat out and what is the cost per meal and how large % of monthly income goes to eating out.
• It is a game of skill and luck. It is possible to raise your net worth faster than the statistical stock market average. For example for J it gives good profit per hours spent researching. Then again, J can invest in companies he has visited in his water engineering projects. I don't visit customer companies. It is unclear if there is any game of skill for me. The only way to find out is to try.
• It is more leniently taxed than salary income. For dividends, 70% of dividend income is capital income for which you pay capital gains tax. The final tax is 20% of dividend's value. This is less than half my marginal tax rate on salary (if I would get 100e more salary, the tax man would take over 40e). Now you may say that there is double taxation on dividend income: the company paid taxes and you pay taxes. However, there are also side costs for employing people. As a rule of thumb, salary + side costs = 1.6 * salary. The 26% corporate tax is smaller than side cost percentage.
• It makes you a better writer and person. Both J and Mangan invest, and their investment posts are consistently high quality: betting money on being right makes you consider your opinions. Investors have personal interest to know what happens in the world as it impacts their lives.

Money is a huge taboo, for example not a single person has ever told me his monthly salary. Outside immediate family, only two persons have ever admitted owning stocks. I am aware that writing about money is not necessarily wise in Finland, will be careful about not disclosing anything, and will stop as soon as I start to notice strange remarks in face-to-face discussions.

The funniest royal wedding video

This dance video uses some principles I described in Visual style of parapara:

• Moves are synced to the rhythm.
• Dramatic peaks in dance routine are synced to dramatic peaks in music.
• There is a priorization choice to use only easy moves. Only the jump at 2:10 is demanding. In parapara, this "easiness leeway" makes the dance accessible to masses of people at clubs. This video harnesses easiness leeway to focus on body language and role acting.

There are also two explicit signs of parapara. At 1:24, there is a full sweep. At 00:30 - 00:45, the girl group performs "girlified parapara" - instead of doing symmetric X:es, they only do only one line of X. Instead of doing a straight, geometric lines as far as their hands reach, they keep hands bent. This makes the move smaller in size and more relaxed, resulting in more feminine and less dominating body language.

Status signaling

There is a clear hierarchy among the 4 young men. In the very beginning, the two young men display alpha devil-may-care attitude by throwing away the speech papers and by unharried pimp walking. Faster speed expresses higher relative status: higher-status men run circles around others.

There is just one explicit dominance/submission scene at 2:10. Elsewhere already-high-status alphas voluntarily and autonomously carry out their roles to serve even-higher-status ones.

In the end, the groom softens his touch with some vulnerability game. At 1:54, he hurries to his princess to save her from the sternous effort of walking, but backs off at the last moment with a mischievous slap on vaginal area.