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Apex Money Posts

How to spoil your kids (or grandkids, or someone else’s kids)

Spoiling your kids is bad… unless you do it the right way. 😀

If You’re Going To Spoil Them, Do It Here [Daily Dad] – “Books. Travel. Culture. Spoil them rotten with these things. To the best of your ability, show them everything you can here. Immerse them in them. Immerse yourself in them. That’s how we raise kids who are the opposite of spoiled—by stoking their curiosity about people and ideas and places that are different from them.”

This one has nothing to do with money but I found it useful…

Everything You Know About Lightning Safety in the Backcountry Is Wrong [Outside] – “Crouching reduces your likelihood of being the tallest point on a landscape. But, paradoxically, lying down puts you in even more danger than standing up. That’s because when you’re lying down, you maximize your contact with the ground. That makes ground strikes more likely to affect you. It also makes it more likely that a ground strike could enter your body through a foot and exit through your arm or neck—arcing through your heart along the way.” The lightning facts at the end are fascinating… including what different thunder sounds mean.

The Ticker Trap Explained [Investing Insights by Stef] – “What I mean is this: New traders must be cautious about tickers that resemble well-known companies, but are the total opposite. Oftentimes, it’s a penny stock disguised with a ticker or name to look like a publicly traded behemoth that’s known across the lands.”

Evolve Bank & Trust’s data hacked

We last discussed the bankruptcy of Synapse at the start of June but the story seems to be getting worse and worse for Synapse and for fintechs as a whole.

The latest news involves Evolve Bank and Trust, who was involved in a ransomware attack by a Russian hacker group called LockBit. LockBit got a “cache of Federal Reserve data” and released 33 terabytes of data from Evolve’s systems. If you want to keep up to date on all the stuff happening with fintechs, Jason Mikula is great for this.

Since Evolve works with a lot of fintechs, a lot of data was released – including that of Mercury, Stripe, Dave, EarnIn, TabaPay… so if you’re a use of a fintech that partners with Evolve for banking services, your data is probably out there – including Social Security numbers.

But here was his tweet:

Scary stuff!

The problem with a Forever Home mindset.

Well, we’ve reached the end of the week. Time to make the most of early summer, folks! Before you go, though, here are a few things I’ve gathered to share with you all.

I’m going to start things off with an article that really hit home for me — probably one of my favorite articles of the past month or two (at one of my current favorite blogs).

Accumulation is living in the future. [Money with Katie] — “Accumulation is the magic of ‘one day’. Decumulation is the pressure of ‘right now’. To continue to accumulate is to reject the reality that the future you’ve saved for is already here. To contend with your lifelong approach to money is to contend with your own mortality.”

If you want to develop self-worth, do things that give you self-worth. [Becoming Minimalist] — “We fall into a trap when we think we need to feel good about ourselves before we can start doing something worthwhile. Because actually, the opposite is true. Action results in better thinking—not the other way around. You don’t have to wait until everything is perfect before taking a step in the direction of the change you want to see in your life. Take that step—and watch your circumstances change around you.”

The problem with a Forever Home mindset. [Retire Before Dad] — “I’ve watched neighbors and family members stay in what they thought would be their forever homes for too long. The longer that belief holds, the more difficult it is to rectify housing deficiencies when needed. Unfortunately, injury, disability, or other health issues can hasten the need to move. Homes can suddenly become unlivable, leading to accelerated timelines, rushed decisions, and limited housing choices…A better plan is to assume you’ll need to move and start planning as early as possible.”

Our non-financial video of the day is this three-minute ice-skating performance: Amber Glenn performing to Olivia Rodrigo’s “Vampire”.

I love everything about this video — especially the camera work. Glenn’s athleticism is exhilarating, just like Rodrigo’s song. Kind of makes me wish that we had the winter Olympics coming up, not the summer Olympics…

Okay, that’s all for this week. Jim will be back on Monday with more great stuff for you.

Choosing an offline life.

Good morning. Today is Thursday, and this is still Apex Money. Every weekday, Jim and I gather our favorite stories about money (and more). Here are some recent finds.

How useful is historical data in predicting future returns? [Retirement Researcher] — “If the world is significantly different from the world where we saw a lot of these historical returns, why look at them? To a certain extent, because that’s what we have. There’s really no other way to estimate what future returns will look like. Even the fancy models that they gush over on CNBC (and which are usually wrong) are, at root, based on historical data. But how we use the historical data is incredibly important.” This is one of the key concepts I try to get across when I write/teach about investing: Historical data is the best tool we have — but it’s not a great tool

The dos and don’ts of lending money. [NPR] — “The experts we spoke to agreed on this point: Don’t lend money to people. If you have the funds and want to help out, give it to them as a gift instead. That way, you don’t have to worry about the borrower paying you back or what to do if they don’t.”

Choosing an offline life. [Our Next Life] — “At least for now, I changed my relationship with the internet. I decided that the relationship I want in this season of life isn’t two-way. I’m not yearning for page views and likes and proof of engagement, as I often have in the past, rewards the internet sends my way because I’ve put enough of myself out there to earn those things. I want a relationship that’s only one-way. The internet gives me information when I want it, and I give nothing in return.”

I very much love that last piece, although I realize there aren’t a whole lot of takeaways for most people. You see, Tanja and I have been on sort of parallel paths in recent years. In fact, one of the highlights of each year is the hour or so that I get to chat with her at Fincon. We share thoughts on art and art supplies, talk about the classes we’re taking, and generally nerd out. I feel like we would have been good friends had we met in high school or college.

Anyhow, we’ve both been gradually disengaging from the internet, and it’s helped us rediscover ourselves and come more alive. That’s a good thing. (Also, you should check out Tanja’s art. She does good work!)

Over the past few weeks, I’ve discovered the world of stand-up comedy albums on Apple Music. And I’ve re-discovered how funny Bill Cosby was back in the day. Here, for instance, is Cosby’s ten-minute bit about cooking breakfast for his kids, which I still find hilarious.

When I was in high school, my friends and I — wholesome goody-goodies all — would sit around and listen to Bill Cosby records and laugh and laugh and laugh. Didn’t matter that we’d heard all of the sketches dozens of times before. In fact, knowing what was coming often just made it all funnier.

The life hedge.

Welcome to Wednesday, Apexians. If all has gone according to plan, I’m on a plane to Wisconsin at this very moment. Kim and I are flying out to visit her best friend for a week. But have no fear! I gathered money stories in advance so that you’ll have good things to read for the rest of the week. Good things like these.

Are you lucky or good? [Can I Retire Yet?] — “It is worth considering whether we’ve made good decisions or whether we’ve just been lucky to have such positive outcomes. If you are assessing your own retirement readiness, it is worth considering how heavily to weigh the input of those who recently preceded you.”

Why success doesn’t lead to satisfaction. [Harvard Business Review] — “The insatiable goals to acquire more, succeed conspicuously, and be as attractive as possible lead us to objectify one another, and even ourselves. When people see themselves as little more than their attractive bodies, jobs, or bank accounts, it brings great suffering…You become a heartless taskmaster to yourself, seeing yourself as nothing more than Homo economicus. Love and fun are sacrificed for another day of work, in search of a positive internal answer to the question Am I successful yet? We become cardboard cutouts of real people.”

The life hedge. [We’re Gonna Get Those Bastards] — “I construct a portfolio in such a way that I might limp along or be flat during expansions, but explode higher during recessions. So when things are good, I’m making money at my job, but not really excited about my investments, but when things are bad, and I’m losing money in my business, it is more than offset by the gains in my portfolio. So instead of being either deliriously happy or despondent, I am pretty much Even Steven all the time. No stress. I call this ‘The Life Hedge’.”

Let’s wrap up today with something that, to me, is simultaneously super fun and soul-crushing. Here’s a CBC story from 1970 about collecting “antique” comic books.

This is fun for me because I’ve been an avid comics fan since I first learned of their existence back in, say, 1974. It’s soul-crushing to me when I hear how little certain comics sold for back then (then compare that with how much they sell for today). If only I could have bought a copy of Superman #1 when I was fifteen months old haha!

Nobody knows what’s going on.

Hey hey, whaddya say? Today is Tuesday! I’ve gathered some great reading for you today. Take a look!

Wealth and money are two different things. [Darius Foroux] — “Material wealth, which is acquired with money, is not the most important thing. Genuine wealth means freedom. Think about those people who have a lot of money but they can’t do the things they truly want. I wouldn’t call them wealthy. They are rich and have lots of money. But they’re not free.”

Nobody knows what’s going on. [Raptitude] — “This scenario, in which there’s much more wrongness going around than rightness, is probably the norm. People make bad inferences like that all day long. These wrong ideas replicate themselves whenever the person tells someone else what they know, which the internet makes easier than ever. Consider the possibility that most of the information being passed around, on whatever topic, is bad information, even where there’s no intentional deception.”

Brief interlude: Cain’s article hits upon something I’ve been thinking about a lot recently. More and more, Reddit is being held up as some sort of paragon of reliable information (even by entities like Google). It’s just not the case. Reading the subreddits about which I have some knowlege, Reddit sometimes gets things right, but just as often it gets things wrong. Reddit isn’t a source of reliable information. It’s a popularity machine. The info that rises to the top (through upvotes) is the stuff that people want to be true, not the stuff that’s actually true. Sometimes there’s overlap. Often, there’s not.

And, in fact, this whole notion — the prevalence of false information on the interwebs — is a huge part of what led to me giving up on Get Rich Slowly. What’s the point? There’s so much bad money info out there (or pointless money info) that it felt like I was shouting into the void.

As I’ve come to believe that the internet does more harm than good in our society, its ability to amplify false information is one of the biggest problems. It used to be that there were active barriers to the spread of misinformation. It could spread, sure, but slowly. To truly have a voice, you had to pass through a gauntlet of knowledgable folks who controlled the means of mass communication. I realize that this created some system issues, but it also (largely) prevented problematic “info” from spreading like wildfire.

Anyhow, Cain’s article is a good exploration of this topic.

Semi-related:

Our mistaken ideas about what makes us happy. [Zen Habits] — “In the list above, of outward happiness activities, you might notice something — many of them are related to some inward experience. And that’s the most important thing — the real happiness comes from what’s happening inwardly.”

As usual, our final feature today has nothing to do with money. It’s simply one of my favorite videos from the past few weeks. In this case, it’s an 18-minute flip-through of the July 1967 issue of Seventeen magazine.

I love this. It’s one of my favorite videos I’ve found on YouTube. It manages to capture so many of the things that interest me right now: nostalgia, art, fashion, mid-century modern design, periodicals, pop culture, and more. I’ve watched it twice from start to finish, and I’ll probably watch it at least once more in the near future.

What’s more, I want to get a physical copy of this issue so that I can use some of the photos/illustrations as reference for drawing. So many cool things to draw!

(This video is but one of nearly 1500 similar magazine flip-throughs on the Casa Mia Vintage channel on YouTube.)

Why haven’t home prices dropped?

Good morning, my friends, and welcome to Monday. It’s J.D. here with another week of Apex Money goodness for you all. Here’s what I’ve gathered to kick things off.

How to be enough. [Vox] — “Where we falter is believing that more money, more things, better things, better selves will ultimately make us happy…In one sense, the quest for self-optimization may be a means of asserting control over our lives when war, climate change, and political polarization wreak havoc around us, she says. All the wanting, though, leads to overconsumption, Dubey says.”

The man who couldn’t stop going to college. [The New York Times gift article] — “No one more fully embodies the nature of elite American higher education today, in all its contradictions, than a man who has spent so much time being molded by it, following its incentives and internalizing its values. But what are those values, exactly?” True story: When I was young, one of my ambitions was to spend my entire life as a college student.

Why haven’t home prices dropped? [Of Dollars and Data] — “If you want to know why home prices are unlikely to drop by a significant amount in the near future, this is your answer. Who wants to see half of their portfolio decline because someone built affordable housing nearby? No one. As a result, many homeowners end up fighting tooth and nail to prevent such future developments.” Meh. This is only one piece of the puzzle. According to my friends in real estate, another huge problem is institutional investors purchasing home inventory, driving up prices for actual prospective homeowners. I’m sure there are other causes too.

Today’s last feature has nothing (or little) to do with money. It’s a ten-minute film from 1976 (or 1982, the source is unclear) chronicling a day in the life of the Prudential building in Chicago. (Based on the clothing and the computers, I’d say this is 1982, not 1976.)

This video is a fascinating time capsule, for one, but it’s also relatively compelling for its intended purpose.

4 Types of Wealth

At my first job, a software engineer with Northrop Grumman, an older engineer said that life was about juggling a series of five or six balls. I don’t recall the exact names but it was things like your career, your health, etc. All of those balls are made of rubber, save one. The last one was made of glass and it represented your relationships.

You can drop the ball on your career and still recover. You can drop the ball on your health and still recover. Dropping the ball on your relationships, especially those closest to you, is much much harder. Sometimes impossible. That mental model has stayed with me for decades.

It’s very similar to what I’m sharing today, which are the types of wealth.

The first piece is an idea from James Clear in one of his 3-2-1 emails

“There are at least 4 types of wealth:

Financial wealth (money)
Social wealth (status)
Time wealth (freedom)
Physical wealth (health)
Be wary of jobs that lure you in with 1 and 2, but rob you of 3 and 4.”

And expanded on by Fritz:

The Five Types of Wealth [The Retirement Manifesto] – “When you think of “Wealth,” what comes to mind?

If you’re like most people, your first thought is of financial wealth. Money, houses, possessions, “stuff.”

If that was your first thought, today’s post is for you.

Yes, Financial Wealth is one of the five types of wealth. And yet, in our quest to live our best possible lives, is it the most important type of wealth? What are the other types of wealth, and what can we do to become truly “wealthy” in the broader sense of the word?

Today, I’m challenging you to become rich, in ways you’ve probably never imagined.”

While his fifth wealth, Eternal Wealth, focuses on religion, yours could be different. Either way, it’s definitely something to focus on, whatever form it takes.

At the risk of ending the week on too philosophical or heavy a note, I want to share this gem:

A Brief History of Time Travel [Sean McGowan on McSweeneys] – “The first successful instance of time travel occurred in 2306, when a group of Syracuse University researchers transported Tootsie, a chimpanzee, to the front lines of the War of 1812. The scientists were awarded a Nobel Prize, but despite deftly outmaneuvering the British Royal Navy in the Battle of New Orleans, Tootsie won no military decorations.”

Thorstein Veblen’s Theory of the Leisure Class

A Veblen good is one where demand goes up as price goes up. The theory behind this is that these items are such powerful status symbols that the higher price, and thus greater rarity, makes them even more desirable.

Think Birkin bags. They’re just expensive bags, but they are coveted by their fans.

Veblen is named after Thorstein Veblen and he had a lot of theories:

Thorstein Veblen’s Theory of the Leisure Class—A Status Update [Rob Henderson’s Newsletter] – “This explains why status symbols are so often difficult to obtain and costly to purchase. These include goods such as delicate and restrictive clothing, like tuxedos and evening gowns, or expensive and time-consuming hobbies like golf or beagling. Such goods and leisurely activities could only be purchased or performed by those who did not live the life of a manual laborer and could spend time learning something with no practical utility.”

Why Are ETFs (Sometimes) More Tax-Efficient Than Mutual Funds? [Oblivious Investor] – “In contrast, if you or I want to sell shares of an ETF, that’s a transaction that happens on the secondary market. We aren’t transacting with the fund itself at all. We’re just selling our shares to somebody else who wants to buy them. And that means that the ETF doesn’t have to do anything — doesn’t have to sell anything, and no tax costs are incurred by remaining shareholders in the fund.”

This next one is really fun:

How the Colors Got Their Names | Otherwords:

Keep life’s less admirable emotions at bay

I’ve long admired the thinking and work of Jonathan Clements, the owner operator of Humble Dollar (which we’ve linked to many many times in various editions of Apex Money). Though we’ve never met, I’ve read his writing long enough to feel like I know him.

Just a few days ago, he published a blog post in which he shared a grim cancer diagnosis.

As someone in my mid-forties, I’ve known several people who have battled cancer and most, but not all, of them won (though they will tell you, they’ve only won it “for now).

And for all of them, the path started in the same way – with something seemingly innocuous.

The C Word [Humble Dollar] – “The cliché is true: Something like this makes you truly appreciate life. Despite those bucket-list items, I find my greatest joy comes from small, inexpensive daily pleasures: that first cup of coffee, exercise, friends and family, a good meal, writing and editing, smiles from strangers, the sunshine on my face. If we can keep life’s less admirable emotions at bay, the world is a wonderful place.”

Life is short enough as is. Hug your loved ones. Find joy every day.

And “keep life’s less admirable emotions at bay.”