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| Thu Aug 5 21:05:04 2010 More Platitudes |
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| Mon Aug 2 22:53:03 2010 Deflation and Stagflation |
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| July | |
| Sun Jul 11 22:38:59 2010 The End of Microsoft |
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| Thu Aug 5 21:05:04 2010 More Platitudes A few more great rules of thumb for personal finance... |
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| Way back in December I gave my list of
Personal Finance Platitudes. Today,
Yahoo! Finance had
their own list of rules, which I thought was pretty good.
I had often noticed what I called the "Rule of Threes", whereby I would prefer to buy cars that cost at most 1/3 of my yearly income, and houses at most 3 times my income. It is a handy rule to keep in mind when shopping for cars or houses! But I wasn't sure why those particular numbers worked. The Yahoo! article gives the math behind the numbers. That article also mentions the high cost of kids (at least $220K per child up to age 18, not counting private education or college!). And it has a good rule of thumb for education loans: don't take on more college debt than you expect to earn per year when you get out. Again, a simple rule, and they break down why. And finally, they had a rule for retirement: target a total retirement savings of 25 times what you make now (!). Here is their list in short:
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Related: > economics < lists Unrelated: books energy environment geopolitics mathematics predictions science |
| Mon Aug 2 22:53:03 2010 Deflation and Stagflation I think we're turning Japanese... |
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| Today, the
Wall Street Journal had a story about
renewed deflation fears. Given that the US ecnomy has been slow to recover, there is now real fear
that prices will continue to decline. That in turn can cause a
deflationary spiral.
Any talk of deflation immediately turns to Japan, which experienced a "lost decade" as growth came to a standstill in the 1990s. As bad as that was, deflation is usually better than stagflation, which is what I predicted in 2008 (see The S-Word). However, the massive inflation I feared didn't happen. The economy cooled fast enough (people stopped spending) so that lower interest rates didn't cause inflation. People think deflation may be on the horizon in the US because prices are flat or down, and unemployment is still high. However, I think a deflationary spiral is unlikely. Prices may drop slightly for the next few months, but I think we'll be fighting inflation in a year's time, not deflation. Why? Mainly because a majority of companies expect to expand in the next 12 months. With the combination of increased hiring and equipment expenditures, I think things will heat up again. Probably in 2011 or 2012 the economy will be running hot enough that we'll run out of oil again (see High Oil and Gas Prices). But we'll run into problems with inflation first. Comments |
Related: > economics < predictions Unrelated: books energy environment geopolitics lists mathematics science |
| Sun Jul 11 22:38:59 2010 The End of Microsoft Taken down by the little guys... |
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| You've probably already heard about the
Microsoft Kin fiasco, whereby
Microsoft spent several years and around 1 billion dollars (a
billion dollars!) to produce the Kin phones, which were then discontinued
after just 6 weeks. They weren't selling.
Just recently local papers noted that Microsoft was firing people, although it isn't clear if these were related to the Kin disaster. Microsoft has been steady sliding in the mobile market. Market shares as of July 2010:
But this is just mobile phones. Why do I think this means the End of Microsoft? Because the future of computing is mobile devices. We've already seen the death of the desktop, killed by both browsers and laptops. Soon the laptop will be killed by mobile devices. Mobile devices are already doing most of what laptops can do, and in a few years laptops will really look like dinosaurs. Microsoft understands that mobile devices are the future. They take the same development platform philosophy as Apple, that is, try to produce a compelling customer experience while making it very difficult for application developers to build for multiple platforms. They want to keep a steady revenue stream for their mobile operating system, regardless of which phone is selling. But they can't seem to make any headway with Windows Mobile! Laptops and desktops are going away, and with them, Microsoft's main cash cow, the Windows operating system. Since office applications are also moving to the cloud, Microsoft has no cash cows left. The future of computing, only a few years away, is mobile devices, and Microsoft is steadily losing market share in the only strategic market. I'm not excited to see a large local company--and former employer of mine!--about to go off the precipice. Hopefully they will learn from their mistakes here, and get a compelling mobile operating system out before it is too late. Comments |
Related: > economics < predictions Unrelated: books energy environment geopolitics lists mathematics science |
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