Archive for November, 2012

So I’m wondering why people would wait 5 days in front of a store to save $200 on a television.   At least that’s what the last news report I saw stated as they interviewed people (stupid people) about how long they were waiting and what they expected to get out of it.

Let’s do the math.  If you have FIVE whole days to kill meaning 80 hours (120 hours – 40 for sleeping) then why not just go get a freaking temporary job working somewhere for $10 an hour?   That would be 80 hours x $10 = $800.    In case you are too stupid to do the math, $800 is greater than $200 so waiting in line for 5 days is a fairly stupid thing to do sitting around and doing nothing!

Of course, if the monetary equation weren’t bad enough, dealing with the crowds, lack of parking, being trampled to death, and other mayhem isn’t worth saving $200 but stupid people can’t figure that out.

I’m almost done with my first MBA degree and will finish the second MBA shortly after and while I’m not technically finished, I think I’ve completed about 90% of the program to make an informed assessment that I can share with readers.   Before I give you my assessment we’re going to need an analogy here and I’ve decided to select fast food as the analogy.

If you recall the big fiasco over Taco Bell’s beef filler then you’ll have an understanding of where I’m going with this but first some background.    In early 2011, there was a big uproar over what Taco Bell was doing to their tacos which supposedly contained “100% all” beef.   We came to find out that “all beef” seemed to include things like “beef, water, isolated oat product, salt, chili pepper, onion powder, tomato powder, oats (wheat), soy lecithin, sugar, spices, maltodextrin (a polysaccharide that is absorbed as glucose), soybean oil (anti-dusting agent), garlic powder, autolyzed yeast extract, citric acid, caramel color, cocoa powder, silicon dioxide (anti-caking agent), natural flavors, yeast, modified corn starch, natural smoke flavor, salt, sodium phosphate, less than 2% of beef broth, potassium phosphate, and potassium lactate.”

I don’t know about you but I don’t think cows produce most of these fillers naturally therefore they must be added to the blend.   But fret not, Taco Bell tacos do have some nutrition in them as they often come with lettuce, tomatoes and so on.  If you wanted to think about the nutritional value of any junk food you may place the ratio at 20% “good” and 80% “bad” given that the little vegetables and other nutrients are in low quantities usually and the “junk” factor makes up for the other 80% or so.

So now how does this compare to the MBA program?  Well it’s exactly the same thing, I kept trying to figure out why it was taking so long to finish this degree program since many of the classes kept repeating the same material and  content over and over again.  Most MBA courses have an infatuation with Porter’s Value Chain and while it may have been great in 1985 before modern globalization, I think the world and most businesses have moved to a ring-fenced globalized model and  yet nearly every management and marketing class seemed to obsess over Porter’s Value Chain.      Moving on to finance, the courses kept repeating over and over again items related to the inner working of the Federal Reserve, interest rates, and so on.   Don’t get me wrong, there are some good nuggets of information and knowledge here but literally they are “nuggets” and nothing more.    Each MBA course, in my opinion, has 20% “nutritional value” and 80% garbage filler nonsense.

So what does this all mean?  With the cost of college costs soaring because everyone thinks it has value, I fear we’re all chasing fast foodesque education at fine dining prices.       Unfortunately students are asked to support an entire academic ecosystem devoid of real nutrition more interested in paying bloated salaries, pensions for staff, building costs, union workers (e.g. janitors making 80k/yr) and so on.

What should be done?  I don’t know.   The academic system is becoming as broken as the U.S. health care system with crazy subsidies and crazy partnerships whereby students are forced to pay ridiculous prices for textbooks because of deals schools strike with college book cartels.   To give you an example, every professor is now claiming that the “international textbook will not be accepted for this course” with no reason given whatsoever.  It’s very timely since there is a huge lawsuit heading to the supreme court this year regarding the fact that international textbooks which contain 99.9% same content as domestic textbooks but cost 60% less than the US version.   Are professors getting kick backs?  Publishing deals?  Who knows and who cares, where’s the free market in all of this?   It is quite ironic since it’s an MBA curriculum which speaks about the benefits of globalization and lower costs yet it doesn’t seem to apply to the university.

In the long term, just like health care, the college academic system is simply not sustainable and it will come crashing down probably right after the health care system crashes.

 

With the aftermath of this year’s election, I decided to take a trip down memory lane.  I wrote this post in January 17, 2009 exactly three days before the Bush administration presidency officially ended.   So I lost my job under the Bush admin and I regained a job in August of that year and slowly climbed back up to making about the same amount of money I was making during that time frame today.

Was my financial success and recovery directly attributable to Obama?  No.   And if McCain had won the election, I wouldn’t be giving McCain accolades for anything that happened in the economy during that time.    The reason I was only unemployed for such a brief period of time while others have struggled is because I consistently and constantly re-invest in myself.   Whether going back to school to earn MBA’s or self-teach myself new skills or attend professional training to earn certifications or certificates in fields, the destiny I made was my own.

It reading about some of the exit poll interviews, I was surprised to see many mentions of Bush four years later post the election and I can relate.   While I don’t hold Obama responsible for my success I still do resent Bush to some extent for the gross incompetence in 2008.  Perhaps it wasn’t Bush’s total fault but someone’s neck needed to be wrung and his fit just fine.

The office was eerily quiet the day after the election, there were many Romney supporters there and I suspect a few people were in shock about the loss but I wasn’t surprised at all.

If you’re sitting on your ass right now because you’re unemployed then might I suggest three industries:

1. Healthcare – With 80 million boomers getting older day by day there will soon be a near infinite demand for nurses, doctors, medical devices sales people (think wheelchairs, crutches, walkers, etc), radiologists, pharmacists, etc.   You can even look into elderly care and the associated ecosystem of these services.

2. Energy – With the global population increasing day by day, there will be huge new demand for energy: oil, gas, solar, wind, electricity, etc.   Anything from utility workers, engineers (petrochemical, mechanical, structural), geophysicists, etc.

3. Education & Technology – With 80 million boomers retiring and the world becoming more sophisticated with things like mobile phone payments, online business/eCommerce, online classrooms, etc. there will be HUGE demand for technologists and educators, just make sure to pick something that can’t be easily outsourced to India or China.

Going back to school won’t be easy, I’ve been attending now since Fall of 2009 and will be done Fall of 2013 but from my present salary, job opportunities, and other investment activities, the education has been well worth the money.     Stop whining about who the next president will be and start making your own destiny.

So I’m now floating about 50k in student loan debt at an interest rate of 1.85% and I’m guessing you may be asking how?   But wait, there’s more….not only am I floating 50k in student loans, these loans are no longer tied to any federal program which means if I were to default I wouldn’t even have my check garnished!

So how you ask?  Well it’s a three step process and this won’t work for you if you aren’t good at saving money.   No, this doesn’t involve credit card arbitrage although that would be a good next step to get the loan rate from 1.85% to zero for 12  to 18 months anyway.   The 1.85% rate however is good for up to 5 years but right now, I’m on a path to pay off in three years.

Step 1 – You will need to have an initial pool of money from somewhere (anywhere it doesn’t really matter as even your local loan shark can be of help).  I would suggest you start with 10k or so.  For me, I took out federal student loans at a rate of 6.7% over the course of three years about 10k per semester for a total of 50k so far.  I still have a couple of more semesters to go so perhaps another 20k.

Step 2 – Take the pool of money (e.g. 10k) and go to a local credit union that offers share secured loans.  Essentially this means the credit union will loan you dollar for dollar what you put into the credit union.  The beauty here is to find a credit union that offers low interest rates, many are below 2% right now.

Step 3 – Pay back the initial loan (from Step 1).   You have now “laundered” your student loan debt from government encumbered debt to cash secured debt with no government hooks into your debt structure.

There are a few cons to this strategy.  First, you will no longer have any student loan forbearance, grace periods, etc as the loan is effectively paid off but this is a small price to pay for not having to worry about the government garnishing your tax refunds, social security, etc at some point later in life should you default.

The second con is that you will need an income source to start paying back the loan as it’s only a three to five year loan.   Depending on your loan amount the payments may be as low as $100 to $1200.

The good news is that after paying the first few payments, your cash in the secured loan becomes free so let’s say you owe $10,000 and you make a $100 payment which means you now owe $9,900.  You should now have $100 in cash “freed” from the encumbered-ment of the loan and the loan can be paid back in a self-sustaining manner from the pool of money that becomes free payment after payment.

 

Today is election day and hopefully by this evening we’ll know who will be leading the nation the next four years.  I actually didn’t vote this year  like I did last election for the presidency.  What I did do was print out a sample ballot and hand it to my son to fill out.   He looked it over and filled out who he wanted to vote for this election.   In all honesty, he was primarily interested in voting for a particular candidate for President and a few other people largely ignoring judges, state representatives and other curious items on the ballot.   Nevertheless, he did fill out the whole form error free.

We then went to the voting booth where I entered the selections and I had him push the “Cast Ballot” button and we were done.   We had to wait 2 hours in line to do this and I actually regret wasting the time to do it as I’m extremely disappointed in the two candidates for office.   We have a candidate with a failed four year plan and a candidate without a four year plan so which is the lesser of the two evils here?

What I would like to see in the next election is a new independent party focused on one thing: viable & sustainable economic growth.   I want this independent party to focus on this and ignore all the other impossible to solve issues I’ve heard on this election: rape, abortion, gay marriage, bengahzi, binders full of women, Keynesian crap, etc.