What would you do with 500,000NT?

You could equally apply the same kind of reasoning to employees who grind out a living always struggling.

I’m not sure you can just look at failed business or startups though - they say it takes an average of 6-7 attempts at business to achieve success. A failed startup just puts you one step closer to the successful attempt.

Even handling the money well is a risky proposition. There were a lot of people who invested wisely, got sound financial advice, did all the “right” things to be on track to retire at 50, and lost so much in 2008-9 that they’ll now be lucky to retire at 65. And the thing is, they all thought they were safe from that. More than a few of them are now looking at all the time they dedicated to it with regret and wishing they’d done something with their time and money.

Unless and until there is some serious government regulation that works to prevent that sort of thing happening again, it’s all just a crap shoot. As long as unrestrained greed is encouraged and rewarded, and equality and fairness is looked down upon, the whole thing is a house of cards. Why play?

You could equally apply the same kind of reasoning to employees who grind out a living always struggling.

I’m not sure you can just look at failed business or startups though - they say it takes an average of 6-7 attempts at business to achieve success. A failed startup just puts you one step closer to the successful attempt.[/quote]

It’s not the same thing. You have to look at the height of the curve and the size of the tails. Even if you average out the outcomes, in the case of an employee, the tails are very thin, and the curve is very big. That means that there’s a high probability of being mediocre and very small probabilities of either making a lot of money or little to no money (or even losing money – you don’t go bankrupt being an employee because if the business goes under, you might lose your job, but you don’t owe the bank money).

In the case of the business owner, the curve is a lot flatter and has fatter tails. This means that you’re far more likely to have an outcome other than mediocrity.

Even handling the money well is a risky proposition. There were a lot of people who invested wisely, got sound financial advice, did all the “right” things to be on track to retire at 50, and lost so much in 2008-9 that they’ll now be lucky to retire at 65. And the thing is, they all thought they were safe from that. More than a few of them are now looking at all the time they dedicated to it with regret and wishing they’d done something with their time and money.[/quote]

This is untrue. They were not investing wisely, getting sound financial advice or doing the “right” things. They were being extremely risky. There were people speaking out against a lot of what was happening prior to the crash. If they’d listened to such people, such as Warren Buffett, then they would have been okay.

Here’s a long term chart of Berkshire Hathaway:

http://finance.yahoo.com/echarts?s=BRK-A+Interactive#symbol=brk-a;range=my;compare=;indicator=volume;charttype=area;crosshair=on;ohlcvalues=0;logscale=off;source=;

Berkshire Hathaway has returned 20% per year (compounded) for decades. That is a pretty good idea and not just because of the return. If those people had bothered to do a little research themselves and had tried to understand the thinking behind what Buffett does, they might have kept their shirts. Instead, they got caught up in irrational exuberence.

Investing in sub-prime mortgages? Hoping that people with no jobs, low income jobs, poor credit ratings, etc. will be able to repay loans? Yeah, that sounds like a winner!

I’m sick of hearing people getting off scot-free for being a bunch of meatheads. Actually, it’s not even that they’re meatheads. It’s that they are/were too lazy to do even the most minor amount of research into what they are/were throwing their money at.

What are you talking about exactly? How are you going to stop people from making stupid decisions in life? If we’re going to go down that route, then we essentially turn a huge percentage of the adult population into giant three year olds. No handling money. No driving. No choosing what food they eat. No voting. Giant three year olds. Also, just who would you have making those decisions for them? A benevolent dictator? Because if the people need to be protected from their own irrationality in individual actions, what makes you think that collectively they’ll behave any more rationally? It’s the notion that people are a bunch of idiots at an individual level, but become geniuses in tandem. That’s completely illogical.

What do you mean by equality and fairness? That people are all forced to make the same decisions? I don’t personally see that as fair to people who were prudent because I don’t see that anyone was forced to choose a risky investment that they didn’t understand. Again, you’re making excuses for their own laziness.

Again, here’s a newsflash for you. Warren Buffett didn’t get burnt in the IT bubble a decade ago. Do you know why? Because he follows one (of several) very simple rules: if he doesn’t understand it, he doesn’t put money in it. If it’s good enough for him to admit that he doesn’t understand something, and therefore, is extremely cautious about it, then it’s good enough for anyone else.

[quote=“GuyInTaiwan”]

Even handling the money well is a risky proposition. There were a lot of people who invested wisely, got sound financial advice, did all the “right” things to be on track to retire at 50, and lost so much in 2008-9 that they’ll now be lucky to retire at 65. And the thing is, they all thought they were safe from that. More than a few of them are now looking at all the time they dedicated to it with regret and wishing they’d done something with their time and money.[/quote]

This is untrue. They were not investing wisely, getting sound financial advice or doing the “right” things. They were being extremely risky. There were people speaking out against a lot of what was happening prior to the crash. If they’d listened to such people, such as Warren Buffett, then they would have been okay.

Here’s a long term chart of Berkshire Hathaway:

http://finance.yahoo.com/echarts?s=BRK-A+Interactive#symbol=brk-a;range=my;compare=;indicator=volume;charttype=area;crosshair=on;ohlcvalues=0;logscale=off;source=;

Berkshire Hathaway has returned 20% per year (compounded) for decades. That is a pretty good idea and not just because of the return. If those people had bothered to do a little research themselves and had tried to understand the thinking behind what Buffett does, they might have kept their shirts. Instead, they got caught up in irrational exuberence.

Investing in sub-prime mortgages? Hoping that people with no jobs, low income jobs, poor credit ratings, etc. will be able to repay loans? Yeah, that sounds like a winner!

I’m sick of hearing people getting off scot-free for being a bunch of meatheads. Actually, it’s not even that they’re meatheads. It’s that they are/were too lazy to do even the most minor amount of research into what they are/were throwing their money at.[/quote]

They didn’t chase quick riches and risky propositions. They followed advice of financial experts. They went to financial planners and said “I want to invest my money for the future, what do I do?” And they took the advice given That’s why there are financial planners - to give people advice. Most people don’t have the time to do all the research and gain all the knowledge themselves, that’s why we have experts. You don’t expect people to spend months or years researching an illness to self diagnose? You go to the expert, ie a doctor. Same with law, or psychology, or dentistry or finance. No different.

What are you talking about exactly? How are you going to stop people from making stupid decisions in life? If we’re going to go down that route, then we essentially turn a huge percentage of the adult population into giant three year olds. No handling money. No driving. No choosing what food they eat. No voting. Giant three year olds. Also, just who would you have making those decisions for them? A benevolent dictator? Because if the people need to be protected from their own irrationality in individual actions, what makes you think that collectively they’ll behave any more rationally? It’s the notion that people are a bunch of idiots at an individual level, but become geniuses in tandem. That’s completely illogical.

What do you mean by equality and fairness? That people are all forced to make the same decisions? I don’t personally see that as fair to people who were prudent because I don’t see that anyone was forced to choose a risky investment that they didn’t understand. Again, you’re making excuses for their own laziness.

Again, here’s a newsflash for you. Warren Buffett didn’t get burnt in the IT bubble a decade ago. Do you know why? Because he follows one (of several) very simple rules: if he doesn’t understand it, he doesn’t put money in it. If it’s good enough for him to admit that he doesn’t understand something, and therefore, is extremely cautious about it, then it’s good enough for anyone else.[/quote]

No one from Wall St went to prison. Not only that, a lot of the people that caused the crisis received multi million dollar bonus payouts. Hold them to account. May them pay for their actions. Make it illegal to profit off the misery of others. Reward ethical behavior and hold those that engage in it up as role models. It’s inexcusable in an advanced country for anyone to receive million dollar plus bonuses while you have people living homeless on the streets. Place an upper limit on salary / bonus packages, or raise taxes on income / investments over a certain amount. Offer tax breaks for ordinary workers not the rich. Take the profit incentive out of essential services such as healthcare, education and staple food. Simple solutions that would create a much more equitable society. Start rewarding the people who are working towards those causes.

Yet there were people making counter claims and giving different sorts of advice. Did they listen to people such as Niall Ferguson, Nouriel Roubini, Nassim Nicholas Taleb or Kyle Bass, for instance? Or, did they listen to the giant elephant in the room, whom I keep mentioning again and again, Warren Buffett? He’s hardly a small player, and even if you haven’t heard of the others, I’m sure you’ve heard of him. He’s one of the richest men in the world. I’d find out what he has to say on different investing matters.

You don’t have to do all the research yourself. What you need to do is do enough research (probably only six to twelve months’ worth of casual reading) to be able to find out if your expert knows what he’s doing. Actually, that’s not even the issue. What you need to be able to do is find out to what extent your interests and those of the person providing the advice/investment intersect. I would say there’s a real potential for a gross conflict of interest between getting advice from someone and buying an investment product from them. You need to be able to ask very pointed questions.

A few years ago, I had a whole lot of money invested through a financial planner. I wasn’t sure of a couple of things, so I began reading up on them. I began discussing them with others. I formulated a list of questions to ask my financial planner. I asked him those questions. I was unhappy about how he explained his thought/investing process to me, and I also didn’t feel our interests aligned. I got rid of him. Later, I was introduced to someone else who had been recommended to me by a friend who knows a lot more about investing than I do and who thought the other guy and I might be on the same page. I asked that guy the same questions (plus a whole lot more at that point). I was satisfied with his explanation of his thought/investing process and I felt our interests aligned. Now I have my money with him.

Note the really important parts there, I’ve underlined them. It was necessary for me to get off my own arse and educate myself to a certain extent before being able to come to those conclusions though. Notice also that at no point have I discussed returns.

I am in no way disagreeing with you here. I would go one step further and make them pay the money back. They shouldn’t have been allowed to get huge golden parachutes after running companies into the ground. The current incentive schemes in many companies are really screwed up, but more on that below.

What exactly does that mean? You mean like medieval usury laws? What about insurance companies? Are you aware of the history of economics in the West from the Renaissance onwards? You do realise, right, that the creation of bond markets in Italy in the Renaissance allowed not only the rulers of those city states to grow wealthier, but also the general citizens of those places to enjoy higher living standards than in other parts of Europe? You do realise that part of what allowed the Netherlands to become incredibly powerful in the seventeenth century was the creation of the world’s first stock exchange, and was why they were able to give England a serious run for their money in naval/trade battles at the time? Also, you do realise that a large part of England’s climb to power was to do with William III (of Orange, a Dutchman) becoming King of England and shifting the centre of banking in Europe away from the Netherlands to England?

There will often be winners and losers, but in trying to restrict that, you restrict the ability for capital to be directed towards ventures that, on average, improve people and societies en masse.

Who would reward the ethical behaviour? Here’s a simple concept. Read about the management in a company, see if you like their thought/investing/management processes, and see if you think their incentives and yours are aligned. There it is again. If it looks like a manager has skin in the game (i.e. if you go down, he goes down), then that’s probably a good bet. If it looks like he can run a company into the ground and then walk away with a huge compensation package, then that’s probably a company to avoid like the plague. Is that really so difficult for people to figure out? Again, note that at no point have I talked about the returns the company makes.

If someone is smart and prudent with his money and others aren’t, I think it’s inexcusable to penalise the former by redistributing what he has made to those who haven’t been smart or prudent. We obviously have a very different world view where you think the stupid, rash, lazy and irresponsible should be rewarded.

That’s for shareholders to decide and shareholders only. Someone without a share in a company is risking nothing of their own and should therefore have no say in that company.

I don’t think anyone should get a tax break. Actually, I don’t think there should be taxes at all and that it should be a user-pays system. Not really sure why anyone should be entitled to any of someone else’s money for free. I call that stealing. Taxation is theft. If I take money from your pocket and give it to someone else, it’s a crime. If the government does it, it’s somehow legitimate. Actually, I don’t even really give a shit these days. I’m beyond that ideology because I realise it’s unworkable. I just thought I’d throw that out there since you’re proposing some pretty radical ideas yourself (such as abolishing a profit incentive). Plus, I realise there’d have to be some crazy unintended consequences from that.

Firstly, what you consider essential might not be considered essential to others. How much healthcare, what sort, etc.? Likewise with education. Likewise with food.

Secondly, are they simple solutions? If food is really cheap, who would be a farmer? If you pay farmers a lot to overcome that, then where does that money come from? Why would someone do other jobs instead? Pretty soon, you’d have everyone wanting to be a farmer rather than something considered “undesirable” by you. What you constantly fail to recognise is that there is a continuum (or maybe several) between wanting to do a job for the love of the job at one end and wanting to do a job because someone throws a big wad of cold, hard cash in your hand at the other (again, probably fits better on two continua). You love your job. That’s fantastic. You just don’t get that plenty of people want the big wad of cold, hard cash and that’s what drives them in life. Do people really become proctologists because they love looking up people’s arses or saving the world or is it because they get some serious moola?

Again, who makes these decisions about what should or shouldn’t be rewarded? Some grand architect/benevolent dictator? Because you won’t get everyone to agree on what is good or right. So, you have to resort to disenfranchising at least a small segment of the population, if not almost all of the population. How well have such political systems worked historically? Wouldn’t such people rapidly accumulate wealth and power for themselves? Wouldn’t anyone with money seek those with power and engage in influencing the political process? Isn’t that the whole problem we currently have (that humans have always had and will always have) that money seeks, and buys, those with power? It’s easy to rail against how things currently are – and there’s lots that’s fucked up – but unless you have a real workable solution, not some pie in the sky lovefest, then everything you propose creates a slew of potentially worse unintended consequences.

Guy, you think too much. It’s actually pretty simple, could be decided by consensus / democratic means once some basic unbiased explanation is given, and has fuck all to do with some king who lived 400 years ago. All major religions and spiritual philosophies talk about it. It’s not that hard, but some have just been brainwashed into thinking otherwise. Deep down, everyone knows where the problems are and how to fix them.

cfimages: Deep down people don’t all know your answer. People disagree on this. That’s why people vote for different parties. That’s why countries pursue radically different policies in just about every different area they make policies. That’s why religions are all different on how to handle a whole lot of issues. Despite what you claim, there is not one human consensus, let alone yours.

What if the democratic consensus wasn’t something you liked? What voice do minorities have in a democracy anyway? Should the ideas of the majority simply be rammed down the throats of those who disagree? What of those who want to live life on different terms?

You would be no more than a mini-would-be tyrant trying to force his vision of utopia on others, with the undesirables (bankers, CEOs and so on) facing the firing squad, either in a literal or figurative sense. Maybe – and this is what you just don’t get – the rest of society doesn’t want someone else’s vision of the truth forced upon them.

Rude and insulting comments removed by moderator.

Thank you for protecting my delicate sensitivities…/S

Guy, people are generally good. No matter where they are from or what religion they follow. People all want peace and security. People are generally willing to help others out when necessary. They are values held globally. Take away the propaganda and general agreement isn’t impossible. Once the will is there, the details take care of themselves.

Is it so hard to make essential, healthy food such as whole grains and vegetables cheap and make high fat high sugar junk food and luxury foods higher priced and higher taxed? Of course not.

Is it so hard to redirect profits and shareholders bonuses of pharmaceutical companies into subsided distribution iif life saving medicines? Of course not.

And very few would be opposed. All it takes is will.

cfimages: People are not generally good. People are generally complex, self-serving, irrational. Mankind has ravaged itself since pre-history. There’s a body count of several hundred million from the 20th century alone. Those regimes, purges, holocausts, wars and all the rest of it were not run by a handful of maniacs at the top. They existed because large numbers of ordinary people visited petty evils upon others. Some had no choice. Others did so with glee. In only two nations in occupied Europe did the citizens rise up against the Holocaust, for instance. The citizens of other nations couldn’t wait to get their Jews, gypsies, homosexuals and any other “undesirables” on the trains to the death camps fast enough. The reprisals against Germans by people in Czechoslovakia or by the Red Army after the War were vicious. Then much of Europe lived under communism for decades. Even in supposedly more enlightened times, after vowing to never have another Holocaust, Europeans looked on limply while Yugoslavia descended into ethnic cleansing and the Yanks finally stepped in and said enough was enough. That says nothing of what happened, and is still happening, on other continents. So no, I don’t believe people are generally good.

I actually think plenty would be opposed to your kind of social engineering, but I don’t think we’ll agree on that.

As a salaried worker you are guaranteed an income but also guaranteed never to earn more than x. Self employment with a view to floating or selling the company makes it possible to earn a very high income or large windfall but most people fail. What many of these studies don’t tell you is that at least half of the successful entrepreneurs have tried and failed multiple times before they hit on the right idea at the right time.

Although I never got a degree I don’t think it’s helpful when financial writers encourage people not to bother with education - not everyone is created equally. Most people with an entrepreneurial streak don’t need anybody telling them to quit school, they’ve already done it. However I do think there are too many people going into higher education (masters, PhDs or even double doctorates) without any real path or purpose.

In my late teens I was given a sum of money smaller than the OP’s windfall and immediately used it to travel. I did enjoy the travel and I guess I could say it enriched me on some level but I sincerely regret ignoring the advice that was given to me along with the money (to keep it invested in the stockmarket). I have since had other opportunities to travel much cheaper and more enjoyably and that money would have more quadrupled by now.

Guy, you seem to have a very pessimistic view of the world. I feel sorry for you, as it appears that you have your eyes closed to the beauty and wonder that is everywhere.

llary: You’re in about your late 30s or early 40s? It seems to have been about 1/4 of its current level around 1992, which was 19 years ago, which would put you at no older than 38, but it’s a little hard to read that chart. That chart also isn’t adjusted for inflation, I believe.

http://stockcharts.com/freecharts/historical/djia1900.html

cfimages: No, I see a lot of positive things also. I just don’t think people are generally good or bad. As I said, I think they’re generally complex, self-serving and irrational. I don’t believe many people actually have a comprehensive plan for what they do or why they do it. I think they react, and in reacting, they’re heavily guided by biology (hence the bit about self-serving and irrationality). Sometimes, they choose to act differently. Sometimes, they don’t. Sometimes, they can. Sometimes, they can’t. Like I said, there’s complexity.

GiT, I don’t mean to be funny, but I’d really like to know the ontological rationale for what you wrote above. Or is it just a gut-feeling?

Oops, I missed that you qualified your statement as business education. Sorry about that. You’re right, of course. I was thinking in terms of the OP’s situation, and he’s interested in an MA in TESOL. My understanding is that the highest paying jobs in this field essentially require that or a very similar degree (e.g., applied linguistics, NOT English literature or even education). Even if he wanted to stay in Taiwan, he’d possibly have the option of teaching at a university or an MOE school. Personally, even if it were all a wash financially, I’d rather teach at one of those places than a buxiban.

Based on statements of various teachers here, it seems that many have the option of taking breaks for months at a time. Otherwise work the year round. In the US, most teachers have a 3 month break. I could be mistaken, but I believe Guy works at an MOE school and gets several weeks off per year plus free airfare.

Tell me about it.

I basically get approximately six weeks at summer, and whatever Chinese New Year/winter vacation works out to be.

Teachers in Australia theoretically get 12 weeks per year, in three blocks of two weeks (Easter, mid-year, September/October), plus six weeks at summer. It never works out even remotely close to that though if you have students in the last couple of years of school and/or if you work at a good school.

jimi: There’s been a fair bit of research into where biology, cognitive science and psychology intersect. In short, I think the issue with humans is that we haven’t evolved nearly as quickly as our world has evolved around us (or rather as quickly as we’ve changed our world around us). We evolved under certain environmental conditions and we don’t live under those conditions anymore. The environmental stimuli we receive now are far more complex overall, though probably less complex in some ways. Yet our brains and those of humans before the last ice age are essentially the same. We simply aren’t adapted to dealing with these changed conditions, and it creates all sorts of problems for a lot of people all the time.

Also, even when we look at less technologically and legislatively/politically complex societies, we see that they were/are pretty irrational and self-serving places to live. Steven Pinker has basically dismissed the notion of the noble savage. People were/are far more likely to die violently at the hands of another human previously in history, or in less developed societies that currently exist (such as those in Irian Jaya/PNG). People do rape and pillage driven by pretty base drives and emotions.

The human animal is a thinker, tool-maker and artist, but he’s also a brute.

Does that answer your question or is that not what you meant?

Have a read of Edward O. Wilson’s original work on Sociobiology. It’s a bit dated, but expresses many of the ideas Guy was talking about.

I take a very similar view of the world - but it’s not pessimism. It’s just taking the good with the bad. If anything, the evil in the world shows in sharp relief the beauty and wonder that remains. You cannot possibly assert that people are inherently good; despite wanting peace, security, etc etc. most humans are quite happy to throw Jews in gas chambers if given the chance (there are plenty of enlightening experiments on that subject). Inherently evil they are not; but irrational, definitely. And mostly, they’re just looking out for themselves. You can see that illustrated in pure form in the way people drive their SUVs in Taiwan. They’re not actually trying to kill you - they’re just not that bothered whether you live or die.

Actually, it probably is. Junk food is cheap because a lot of the raw materials are produced in countries where people are convinced that - for example - slashing down their forests for sugar cane, beef, or oil palm is “economic development”. A nine-year-old with a calculator could prove that it isn’t, but various well-placed people get new BMWs and big houses out of it, so they make sure the little guy thinks it’s all for their benefit and that big bad environmentalists are trying to take away their birthright. I imagine they also make an effort to ensure nine-year-olds can’t get calculators.

Conversely, a lot of very nutritious vegetables are hard-to-get and/or expensive because the places where they might be most efficiently grown are outside of the US and Europe (poor countries, mostly). Those rich countries use subsidies and tariffs to tip the scales so far in favour of their own farmers - who in any case are producing what distributors want, not what consumers want - that the doors are closed to importers. Some plants are banned outright - for example, it is effectively illegal to sell Stevia Rebaudiana (a sweet-tasting plant) in the US because, presumably, it would upset sugar interests. In the EU, anyone wishing to introduce a new food vegetable must go through a complex approval process unless the item is demonstrably similar to an already-approved one. Hence the very restricted selection of vegetables there.

However, the fact remains that all food is extremely cheap - at the farm gate. Logistics and retailing accounts for 80% of the retail price.

I guess it’s lucky humans are inherently good, eh - otherwise it could all be a lot worse :wink:

finley: Precisely. I have moments that are purely sublime. For instance, I live in the East Rift Valley and there’s a particular mountain that dominates this region. I see it every day on the way to school and it always looks different – and always amazing – depending upon what the weather is like on that day, how much cloud cover there is (and so what kind of shadows are on it) and so on. I can walk outside my classroom and look in any direction and see a pretty awesome landscape.

Then there’s man-made stuff like certain music, movies, books, etc. that have blown/blow me away. This is, incidentally why I have no real desire for a career. I’m a bit of a generalist and there’s way too much cool stuff for me to want to spend the rest of my life doing one thing. There’s all sorts of stuff I would do if I had a pile of money, and anything resembling work would not be on that list, yet I also realise there are certain ways to get closer to that objective, and investing is one of them. Delayed gratification. I know more than the average person, yet I don’t find it inherently fascinating, so I palm it off onto someone else to take care of for me.

For me, one of the big issues is being self-aware enough to realise one’s limitations as a human being and finding ways to try to circumvent my inherent extreme irrationality as much as possible. Doesn’t always work, but that’s the objective.

[quote=“finley”]

I take a very similar view of the world - but it’s not pessimism. It’s just taking the good with the bad. If anything, the evil in the world shows in sharp relief the beauty and wonder that remains. You cannot possibly assert that people are inherently good; despite wanting peace, security, etc etc. most humans are quite happy to throw Jews in gas chambers if given the chance (there are plenty of enlightening experiments on that subject). Inherently evil they are not; but irrational, definitely.[/quote]

Are they willing to do it, or are they just brainwashed into believing that “the other” is less than human? No one really knows how many Germans knew about the gas chambers - some sources say it was common knowledge, others say no more than 10% of the population. Who do you believe? Same thing today - there are approx 1.5 billion Muslims in the world and best estimates suggest that less than 10% support al Qaeda and terrorism.

Evil often looks a lot larger than it is.

Bush started what was basically an organized terror campaign against Iraq with the support of 70 or 80% of Americans? Does that make Americans evil? Of course not. Most were more or less brainwashed into believing Saddam was responsible for 9/11 and gave support accordingly. The rest of the world, which wasn’t brainwashed into believing that was 80% opposed to it.

People ARE basically good. Flawed, mistake making, confused, easily led yes, but basically good. Without 10-15 years of propaganda from the powers that be, most Germans would likely happily have lived with Jews. Without years of propaganda from the Republican party and Fox news, most Americans would know that the vast majority of Muslims don’t want to kill all Americans, and in fact share a lot of the same values and beliefs.