What I've been reading

"The Lone Samurai: The Life of Miyamoto Musashi" (2013), by William Scott Wilson.

I stumbled upon this one recently in my old university library, and found the first few chapters interesting enough to find my own copy and read the entire thing. The work reads quickly, but requires some background knowledge of medieval Japanese history and of the various Buddhist traditions that took root there. Also, there were times when Wilson seemed to pile on so many names in quick succession that it became easy to get lost (this comes from someone who finds Japanese names difficult to pronounce and remember). Still, I felt the book to be well worth reading, and came away with many impressions of Musashi (1584-1645) as a swordsman, idealist, artist, and wanderer.

Here is an excerpt from the book:

Except for short periods when he stayed in Kyoto or various castle towns and the last five years of his life in Kumamoto, Musashi spent his life on the road. Travel broadened his perspective on his environment and on human nature, as it would for the traveler-poet Basho nearly a century later. Although many people traveled the roads of Japan at this time, Musashi was far more observant than the average sojourner. His paintings, The Book of Five Rings, and the story of his life all bespeak of a man who dismissed no experience and who noted everything that crossed his path. When he enjoined his disciples not to turn their backs, 'on the various Ways of the world,' he was speaking of far more than just formal studies. The life of a traveler was Musashi's way of ensuring that he would continue to have broadening experiences. A safe position with a local daimyo could never have provided him the same opportunities. 

"Endurance: Shackleton's Incredible Voyage" (1999), by Alfred Lansing.

I'm about two-thirds of the way through this one, and enjoying it. The book is very thoroughly researched, and Lansing does a good job of taking us along on the expedition with Shackleton and his crew. The narrative is very detailed, at times covering events from almost every hour for several days in a row. It's an interesting approach, and gives it a different feel from a typical history.

If the story of Shackleton and the expedition he led interests you, this is an excellent book.

A Gratitude Journal Experiment

Every once in a while, I stumble upon an activity or habit that feels so natural and rewarding to do that I wonder how it took so long to start. Examples from my own life include drawing, daily walks, and keeping a journal. Each of these activities has proven challenging in good ways, and personally very fulfilling.

More recently, I came across this wikipedia entry on "gratitude journals," and decided to try keeping one for a few weeks and see what happened. I was very surprised by the result, though given the research done on this particular exercise, perhaps I shouldn't have been. There's a surprising amount of research of the subject of these journals, and the evidence seems fairly robust regarding its utility:

Empirical research suggests that keeping a gratitude journal has a positive effect on one's psychological, physical, and emotional well being. Regularly recording 3-10 things that one is grateful for can improve and strengthen one's physical and psychological health. 

Gratitude journals can also be beneficial as an addition to psychotherapy or clinical treatment to decrease symptoms of depression, increase happiness, and increase overall well being.

So for my experiment, once a week (usually Friday), I would take a moment to brainstorm at least three things for which I had lately been grateful. Typically I'd list around five or six, but my goal each time was at least three.  "Family," "friends," and "health," often came to mind, but so too did less common ones like "free-time," and "the ozone-layer." It's funny what you think about, large and small, when the subject of gratitude is considered. And it's interesting how an exercise that takes less than two minutes a week to do seemed to improve my mood so markedly, even long after it was performed.

The experiment has gone on for two months now, and throughout I have felt mildly more relaxed than usual, and seemed to experience both an immediate and lasting reduction in stress after performing the gratitude exercise. My experiment can't prove causality in these regards, but I think it does point to the positive effect that expressing gratitude, even just to oneself, can have in one's life. As importantly, perhaps, I like the kind of person I am when gratitude is near to the fore of my thoughts; both in how I feel, and how I interact with others. In this respect, I think the experiment proved worthwhile, and I think I will continue keeping a gratitude journal for the foreseeable future.

*Hiding from scary ideas*

This was an interesting op-ed in today's NY-Times, by Judith Shulevitz:

The confusion is telling, though. It shows that while keeping college-level discussions “safe” may feel good to the hypersensitive, it’s bad for them and for everyone else. People ought to go to college to sharpen their wits and broaden their field of vision. Shield them from unfamiliar ideas, and they’ll never learn the discipline of seeing the world as other people see it. They’ll be unprepared for the social and intellectual headwinds that will hit them as soon as they step off the campuses whose climates they have so carefully controlled. What will they do when they hear opinions they’ve learned to shrink from? If they want to change the world, how will they learn to persuade people to join them?

The full piece can be read here.

Medical care and subjective health

This was interesting:

"Access to more medicine and medical care doesn't really improve our subjective health. For example, in the United States, the percentage of Americans reporting very good health decreased from 39 percent to 28 percent from 1982 to 2006," Zheng said.

...It seems counterintuitive, but that's what the evidence shows. More medicine doesn't lead to citizens feeling better about their health -- it actually hurts."

The article relating this study can be read here.

*If I knew then what I know now*

This was a bogleheads post worth sharing. It comes from this thread.

IF I KNEW THEN WHAT I KNOW NOW
By Michael LeBoeuf

Some years ago, I saw a cartoon of two young guys looking at a very tall ladder with a sign on it that read, “The Ladder of Success.” One guy said to the other, “I was hoping for an escalator.”

1. Over 50 years ago I was sitting in a basic management class just like you. My goal this morning is to share with you some of the things I’ve learned in life that can help you make the climb far less difficult than it has to be.

There is an old but true saying: Rich people plan for 3 generations.
Poor people plan for Saturday night. Your odds of being successful increase exponentially when you begin with a good plan.


2. Let’s begin by take an imaginary trip into the distant future. Imagine you are 50 years of age. I picked 50 because if you have reached your 20th birthday, odds are the majority of your remaining life will be spent after 50. Imagine being 50, being healthy and having the freedom to do whatever you want. You can work if you want to but you don’t have to because you’re financially independent. You can sleep-in, stay up late, watch sports on TV, play golf, take a trip, you name it, because every day is Saturday in your life. Would you like that?
Well, I have good news for you. Every one of you is capable creating a life like that for yourself. It all comes down to making good choices as you manage your life. We are all the sum of the many choices we make every day and those choices; more than anything else determine our fate. The bad news is that historically only about 5 percent of Americans at age 65 are financially independent. Today I’m going to teach you how to be a member of the fortunate 5 percent. Whether your not you do it is up to you.

3. Here are 4 things we know about having a successful life:

A. Success is the product of making good choices.
B. Good choices come from good judgment.
C. Good judgment comes from experience.
D. Experience comes from bad judgment.
The point is to learn from the experiences of others whenever you can. Talk to successful people, find out what they did, learn from them and do something similar. That’s what education is all about – learning from others who came before us. Experience is a very tough, expensive teacher because you get the test first and then you get the lesson. It’s always cheaper and easier to learn from the experiences of others.

I WANT TO SPEND THE REST OF OUR TIME TALKING ABOUT SOME KEY CHOICES THAT WILL BE CRITICAL IN DECIDING HOW WEALTHY YOU BECOME. I’M GOING TO COVER FOUR TYPES OF CHOICES:
1. SAVING AND INVESTMENT CHOICES
2. EDUCATIONAL CHOICES
3. CAREER CHOICES
4. PERSONAL CHOICES THAT IMPACT WEALTH CREATION
I – THE FOUNDATION OF ALL WEALTH CREATION IS ROOTED IN CHOOSING TO SAVE AND INVEST A PORTION OF EVERY DOLLAR YOU EARN
A. Know the difference between income and wealth. Making a high income is nice but that’s not where action is. From this day forward make it your goal to become a wealth builder. For most of us this requires changing the way we think about money. Think of money as stored energy. Money you put away for tomorrow will someday free you from the need to work.

B. Graduate from the paycheck mentality to the net worth mentality. Making a big salary does nothing to build wealth if you spend it all or carry an enormous amount of debt. Instead, focus on building your net worth. Net worth is simply the dollar value of what you own minus the debts you owe. While you are in school it’s perfectly OK to have a zero or negative net worth. But it’s not OK to be broke at 70. Your earning years are behind you and it’s frightening. Right now your greatest asset is your potential earning power because you have years to work, save and invest. Make the most of them.

C. You have heard this before and you’ll hear this again. PAY YOURSELF FIRST. Resolve to save at least 15 percent of every paycheck you earn after taxes. The only caveat to this is to pay off any credit card debts you may have accumulated before saving. The more you can save, the faster you will reach financial independence. Save half of your salary and you’ll likely be able to retire in just 20 years.

D. Put six months worth of living expenses in a bank checking or savings account for emergencies. After that, I suggest you invest your money using a strategy known as passive investing or index investing. Put the rest of your savings into low-cost, no-load, index mutual funds and keep them there. If you do this, over the long-term you will outperform 80 percent of all investors who try to pick stocks or time the market. Four excellent companies are: Vanguard, T. Rowe Price, TIAA-CREF and USAA.

E. Be wary of people calling themselves financial planners who want to sell you investments. The only thing required to be a financial planner is a suit and a sales pitch. The finance/investing business is filled with charlatans who want to sell you products that make high commissions for them. Never invest in anything you don’t understand or can’t explain to a 12 year-old.

F. Don't put any money in stock mutual funds that you will need in the next 5 and preferably 10 years. Put any money you’ll need in the next decade in a bank savings account, short-term bond mutual fund or money market fund. Stocks are volatile, but the only long-term trend is up.

G. When the stock market takes a dive, ignore it. People will tell you to sell before you lose everything. Ignore the noise. The market drops 40 or 50 percent from time to time. Those who panic and sell only lock in their losses. Those who buy and hold will eventually be rewarded when the market rebounds to an all-time high. It has been doing this for over 200 years and will likely continue to do so for the rest of your life. Only two things matter when it comes to the price of an investment: How much you pay for it, and how much you get when you sell it. The rest is just noise.

H. When people tell you they can time the market, tell you when to get in and get out, or they can pick stocks that will outperform the market, they are either lying or delusional. The fact is they don’t know any more about the future than you or I do. Timing the market is for losers. Time in the market is what makes you rich.


G. If you stay the course and follow this plan, your savings will be multiplied by the power of compound interest and you’ll get rich slowly over time. Ignore people who pitch get rich quick schemes.

“The problem with getting rich quick is that you have to do it so often.” - Jason Zweig
In 2005, Vanguard Founder, John Bogle received a letter from a shareholder. The person writing said he had been investing with Vanguard since the mid-seventies and the value of his portfolio had grown to $1,250,000. But here is the interesting part: The man never earned more than $25,000 per year! How he did it is no mystery. It turns out that if an investor invests $601 each month in an index fund and gets an average return of 10 percent, in 30 years, their portfolio will grow to $1, 249,655.
One of the best savings vehicles is to invest $5500 each year in a Roth IRA. If you keep the money there until age 60, any withdrawals you make are tax-free. For example, let’s assume a 25 year-old couple each invest $5500 in a Roth IRA every year until age 60. If their investments earn an average annual return of 8 percent, at age 60 the combined money in their Roth IRA accounts will be worth over $2 million. If they get an average return of 10 percent, it would be worth over $3 million at age 60.

H. A two-career married couple can build a nest egg relatively easy. Live on one salary and invest the other.

G. How much is enough before you can consider yourself financially independent? Twenty times annual spending is a good rule of thumb. If you do that and withdraw no more than 5 percent per year from your investments, odds are good you’ll never run out of money.

H. An e-book worth reading: IF YOU CAN by William Bernstein. Available at amazon.com for 99 cents or free from his website,(http://www.efficientfrontier.com).A website where you can learn online the basics of investing: Bogleheads.org. Click-on: Start here link in the upper left-hand corner.


II – EDUCATIONAL CHOICES
One of the best investments you’ll ever make is the one you are making now by studying at ASU. Education is a great investment if you keep the following points in mind:
A. – Don’t overspend. At ASU you are getting a quality education
thanks to the taxpayers of AZ. Graduate with as little debt as possible.
B. – Major in a field that will increase your value in the job market.
C. - What you major in is far more important than where you go to school.
D. – Be sure and graduate. Close only counts in horseshoes and dancing.
E. Consider the increased earning potential of getting an advanced degree. Ben Franklin was correct: “An investment in knowledge pays the best interest.”
F. Remember that lifelong learning is everybody’s job. We live in a rapidly changing world and in times of change, the learners inherit the earth. Another great saying: if you think education is expensive, try ignorance.

III – CAREER CHOICES
A. How many of you would like to be in business for yourself someday? How many of you would like to work in sales? For those of you who chose neither of the above, I have some surprising news for you: Regardless of what you do for a living, you will be in business for yourself and you will sell something - either to your employer or to customers. In short, understand from Day One that your career and your future are up to you. From this day forward, think of yourself as You, Inc. You are in charge of your own personal finance, production and marketing operation. You and everyone else are in business for yourself.

B. When it comes to choosing a career, here is the best advice I ever heard: Work very hard at something that comes very easily to you. Happiness comes from doing what you are good at and it gives you a competitive edge. Everybody can be a star at something. Look for an occupation where you can shine.

C. Choose a career that doesn’t have a ceiling on how much money you can earn. The more money you make, the easier it to save and invest. The more you save and invest, the sooner you reach financial independence. My former students, Richard and Wayne made millions in insurance. Don made his fortune as a hotel management executive. I chose to become a business school professor because it offered a nice wage and I had the option of supplementing my income through writing, speaking and consulting.

D. How much money you earn will depend on 3 things:
1. What you do.
2. How well you do it.
3. How difficult it is to replace you.

E. It’s important to enjoy your work most of the time, but don’t expect any work to always be unlimited bliss.
Wealth = Passion + Profitability
I enjoyed, teaching, writing and speaking but I never loved any of them so much that I was willing to do it for free. There’s a reason why it’s called WORK.

F. If you hate the very nature of doing the work you do, get another career. Life is too short to be miserable. Years ago I met an air conditioning repairman who had a degree in Accounting and was a CPA. He hated being an accountant, changed careers, started his own heating and AC business and was much happier for it.

G. Finally, never get married to a company because no company is married to you. Work and save with the goal of becoming financially independent because someday you will almost surely need it.



IV – PERSONAL CHOICES THAT WILL IMPACT YOUR ABILITY
TO SAVE
A. WHOM YOU MARRY - Marry one frugal spouse who shares your dream of becoming financially independent. Weddings are all about love and divorces are all about money. Make sure that you and your beloved or on the same page financially before signing up for life. Between 40 and 50 percent of all marriages end in divorce and the leading cause is disagreement over money.

B. HOW MANY CHILDREN YOU HAVE - Have a moderate number of children. The average cost of raising a child born in 2013 up until age 18 for a middle-income family in the U.S. is approximately $245,340 (or $304,480, adjusted for projected inflation), according to the latest annual "Cost of Raising A Child" report from the U.S. Department of Agriculture.

C. THE COST OF LIVING WHERE YOU CHOOSE TO LIVE - Choose to live where the cost of living is moderate. Arizona is moderate. Florida and Texas have no state income taxes and moderate real estate prices. NY, LA, SFO, Boston, etc. are super-expensive and that makes it more difficult to save.
D. THE CHOICE TO BE A HOMEOWNER OR RENTER - Buy a moderately priced home if you are going to be in one place for at least 5 years. The net worth of most retirees is concentrated in their homes. Most renters reach retirement with little or no net worth.


CONCLUSION

When I was a freshman in college, I wanted to succeed, make good grades and graduate. I bought a book on how to study and take exams. I don’t remember what the details were but the author had one line in the book that served me well: Maturity is the ability to relate today’s actions to tomorrow’s results. People who can think 10, 20 or 30 years ahead and make good choices are the one’s most likely to succeed. Make it your mission to enjoy every day, but do something that will make for a better tomorrow. Don’t expect to be perfect and don’t expect everything to go as planned because you can be sure it won’t. However, if you have solid financial and personal goals, make smart choices and stay the course, you will meet with an uncommon success that escapes most people. Good luck happens when opportunity meets preparation.

And someday when you become financially independent, make it your business to stay financially independent. You only have to get rich once, and you may not get a second chance. Good luck to all of you.

Hedonic Treadmill

This was a neat post: 

There are three strong lines of evidence which support the hedonic treadmill theory: 

1.) A growing list of traditional life pursuits are being found to have zero to only small correlations with happiness, well-being, and life satisfaction. These include: beauty, money, sunshine, education,children, and choice. 

2.) A growing number of longitudinal studies which have tracked people over the decades of their life have found that as their life circumstances have changed, their happiness has remained mostly unchanged (presumably because they spent their time focused on misleading goals, like money and status).3.) A growing number studies conducted on twins has shown that genetic factors may account for as much as half of one’s subjective well-being. That is, despite some twins being much richer than their counterparts, their average level of happiness was similar. 

These three lines of evidence taken together indicate that the successful pursuit of happiness requires a departure from the business as usual approach to life. That getting married, buying a house, and having kids isn’t enough. That seeking wealth and fame is a dead-end. That the successful pursuit of happiness requires intentionally pursuing counter-intuitive life strategies.

The remainder can be read here.

Many thanks to "Toons" on the bogleheads forum for posting this.

Multi-tasking neurons

This was an interesting study:

The nervous system evolved to coordinate flexible goal-directed behaviors by integrating interoceptive and sensory information. Hypothalamic Agrp neurons are known to be crucial for feeding behavior. Here, however, we show that these neurons also orchestrate other complex behaviors in adult mice. Activation of Agrp neurons in the absence of food triggers foraging and repetitive behaviors, which are reverted by food consumption. These stereotypic behaviors that are triggered by Agrp neurons are coupled with decreased anxiety. NPY5 receptor signaling is necessary to mediate the repetitive behaviors after Agrp neuron activation while having minor effects on feeding. Thus, we have unmasked a functional role for Agrp neurons in controlling repetitive behaviors mediated, at least in part, by neuropeptidergic signaling. The findings reveal a new set of behaviors coupled to the energy homeostasis circuit and suggest potential therapeutic avenues for diseases with stereotypic behaviors.

That is the abstract, found here (the full text is gated).

A useful summary of the the study can be read here. An excerpt:

These observations unmask the relevance of primitive brain regions previously linked to eating to other complex behaviors," said lead author Marcelo Dietrich, M.D., assistant professor of comparative medicine and neurobiology and a member of the Yale Program in Integrative Cell Signaling and Neurobiology of Metabolism at Yale School of Medicine. "These findings are relevant to understanding diseases with both homeostatic and compulsive components and highlight the multitasking nature of neurons in the brain."

How are living standards changing?

According to Megan McArdle, "It's complicated, but hopeful."

But I think this list illustrates the poverty of trying to measure living standards by staring at median wages. Many of the changes of the last century show up in that statistic, but others, like the time no longer spent plucking chickens, or the joys of banishing lye from the pantry, appear nowhere. Nor do the changes in job and family structure that have made the lives of people who are indisputably vastly materially richer than my young grandparents were, nonetheless feel much more precarious. We look into the numbers and think we’re seeing hard facts. But in fact, like someone reading tea leaves, we are projecting our intangible impressions onto an ambiguous picture.

I don't agree with everything Ms. McArdle writes here, but I find her perspective an interesting one.

The full essay can be read here.

College hopping

This was an interesting story:

Between 2008 and 2012, Guillaume Dumas took courses at some of the best colleges in North America—Stanford, Yale, Brown,University of California Berkeley, McGill, andUniversity of British Columbia, among others—without being enrolled as a student...

...In the end, Dumas has been no poorer for his lack of a degree. In fact, given that he has not taken on any debt, he is far better off than many recent college graduates. He’s now an entrepreneur. "Starting a business is all about your intelligence and your network," he says. "None of your customers care where you went to college. All they care about is whether you can offer them a good product."

The full article can be read here.