One of the privileges I have in my life is that I get a front seat to experience the struggles of myself and my fellow classmates. This 3-year reboot has allowed me to do some serious thinking about the nature of success. This is not so much an analytic exercise, but I see this as more akin to a religious experience.
One phenomenon I notice in campus is the kind of quality people attribute to their personal conception of what success looks like. For folks who really are into personal development, this is very similar to Carol Dweck's notion of the fixed versus growth mindset.
Let us look at the Superman model.
If you believe in the Superman model, your model of success is effortless in Nature. Legends will always tell of some mysterious senior who can drink, party and not study but still get into the Dean's List every year. One of the more ludicrous stories I hear is of a top Law Student who claims that she can throw her books aside on Friday only to pick up her books when the week begins on Monday.
I am very skeptical of this model.
Yes, there will be superstars at school or at work, but there will always something that debunks the Superman model once you get to know these superstars. Some may sacrifice their personal lives, others have a battery of coaches or may have even found a way to outsource their lives to virtual assistants in India. Some may just have an awesome environment to hit the books since they stay in District 10.
The reason why I am skeptical of Superman model is that people who know how to manipulate power practice sprezzatura. Top students in NUS have this irritating habit to make their success seem effortless to sustain this myth of their abilities. Makes them sexy and superhuman. Some go through horrible lengths to get their peers to drink with them in discos only to spend the whole evening mugging to keep themselves in the Top Honor rolls.
In the world of work, the Superman model is the Super-Manager, the great CEO who rockets to financial independence by clawing their way up the ladder. These guys do exist, but they are one in a million.
The question we really need to ask ourselves is what happens if we really have no talent ?
I propose the Batman model. Or if you have a villainous bent, you can call it the Lex Luthor model.
Success is no accident. Batman can't beat Superman in most engagements because Batman is not an alien from Plant Krypton, he can't fly, does'nt have super strength and x-ray vision. He's just a dude in a black nipple suit with a low voice.
But Batman is awesome because he is a superb strategist. He anticipates the move of his opponents and ensures that every weakness will be exploited to the fullest. He's worked hard to train in martial arts and has an array of gadgets to level the playing field.
The Batman model assumes no talent. If you want an edge over Superman, you have to marshal all your resources and work hard to attain your goals. You need to know Superman's weaknesses and have a suitcase of kryptonite ready if you really need to take the Man of Steel down.
Nowhere else is this found in investments.
The Superman model assumes that a superstar analyst exists who can pick out magical stocks and attain financial independence without any effort. The Batman model assumes ordinary market returns, then conscientiously saves and invests based on tried and tested factor variables.
Of course, just because we have two mental models doesn't mean that we can always strategise and plan our way to victory. Adopting Batman's strategies, I have spent my entire life getting my as handed over to me by the Supermans at study and at work.
Sometimes talent does indeed beat hard work.
That's why after a trouncing, Batman can always console himself in the arms of the Catwoman.
Friday, October 31, 2014
Sunday, October 26, 2014
Why we should press on.
At the end of the semester, some classmates are having doubts about whether they made the right choice in coming to the SMU JD program. I promised that over the weekend, I would write something to cheer them up so that they would press on in their studies.
I think that my class is a small class and the industry is large enough to absorb all of us in spite of all these changes going on to "nerf" the legal profession.
For the rest of the readers, my analysis should also apply if you've worked damn hard to get into a fairly exclusive MBA like the one at INSEAD or the APEX MBA program in NUS.
When I look at my class, especially the younger folks in their early-30s and 20s, they are likely to able to be placed in a career that is going through the tail-end of a Golden Age. I've taken some very conservative estimates to calculate the expected net-worth of my classmates upon graduation.
Here are my assumptions.
a) You get the minimum grades to be admitted into the bar. No need for 2nd Upper grades.
b) You start out at $4,500 a month.
c) 7% increment a year with 3 months bonus every year.
d) You save 50% of your income and your entire bonus every year.
e) You invest your savings at 7% returns.
( Ok... granted not all of you lawyers will know how to invest, but 7% a year is not too ambitious )
Based on the table below, if they can meet conditions (a) to (e), a conservative starting salary will net them their first million within 13 years. So if a graduate at 30 charts his career and finances properly, they are likely to make their first million at 43.
I think that my class is a small class and the industry is large enough to absorb all of us in spite of all these changes going on to "nerf" the legal profession.
For the rest of the readers, my analysis should also apply if you've worked damn hard to get into a fairly exclusive MBA like the one at INSEAD or the APEX MBA program in NUS.
When I look at my class, especially the younger folks in their early-30s and 20s, they are likely to able to be placed in a career that is going through the tail-end of a Golden Age. I've taken some very conservative estimates to calculate the expected net-worth of my classmates upon graduation.
Here are my assumptions.
a) You get the minimum grades to be admitted into the bar. No need for 2nd Upper grades.
b) You start out at $4,500 a month.
c) 7% increment a year with 3 months bonus every year.
d) You save 50% of your income and your entire bonus every year.
e) You invest your savings at 7% returns.
( Ok... granted not all of you lawyers will know how to invest, but 7% a year is not too ambitious )
Based on the table below, if they can meet conditions (a) to (e), a conservative starting salary will net them their first million within 13 years. So if a graduate at 30 charts his career and finances properly, they are likely to make their first million at 43.
| Salary | Bonus | Annual Savings | Cumulative Savings | Investment at 7% returns |
| $54,000.00 | $13,500.00 | $40,500.00 | $45,000.00 | $45,000.00 |
| $57,780.00 | $14,445.00 | $43,335.00 | $88,335.00 | $91,485.00 |
| $61,824.60 | $15,456.15 | $46,368.45 | $134,703.45 | $144,257.40 |
| $66,152.32 | $16,538.08 | $49,614.24 | $184,317.69 | $203,969.66 |
| $70,782.98 | $17,695.75 | $53,087.24 | $237,404.93 | $271,334.77 |
| $75,737.79 | $18,934.45 | $56,803.35 | $294,208.27 | $347,131.55 |
| $81,039.44 | $20,259.86 | $60,779.58 | $354,987.85 | $432,210.34 |
| $86,712.20 | $21,678.05 | $65,034.15 | $420,022.00 | $527,499.22 |
| $92,782.05 | $23,195.51 | $69,586.54 | $489,608.54 | $634,010.70 |
| $99,276.80 | $24,819.20 | $74,457.60 | $564,066.14 | $752,849.05 |
| $106,226.17 | $26,556.54 | $79,669.63 | $643,735.77 | $885,218.11 |
| $113,662.01 | $28,415.50 | $85,246.50 | $728,982.28 | $1,032,429.88 |
| $121,618.35 | $30,404.59 | $91,213.76 | $820,196.04 | $1,195,913.73 |
| $130,131.63 | $32,532.91 | $97,598.72 | $917,794.76 | $1,377,226.42 |
I will let the real practitioners discuss the feasibility of my financial projection, these numbers can even apply for the top-flight engineers who can get into the banks after their first degree.
Of course, my table and projections are what happens in theory.
It's baffling to know legal professionals, who shockingly, are not millionaires before 40. There are many reasons why savings and investments targets cannot be met. I mean no insult to those professionals who are still working hard to met their financial targets but the alcohol at Ice Cold Beer attracts a lot of government taxes so less trips to the bars help.
But, I think having a seat in SMU is something we should be grateful for, so I think this qualification is worth striving for, even when many of us are currently our ego bruised and getting perhaps our first B- in our entire lives.
For me, even if no law firm were to take me in due to my age, I think I'd be a pretty formidable outsourcing contract manager if I have to crawl back to the IT industry.
Wednesday, October 22, 2014
Taste and Aesthetics. Being Basic and Normcore.
I think get along fairly well with my JD classmates despite a glaringly large generation gap. I actually said to a classmate that if I had a shotgun wedding when I was in JC, my kid would be her age, Maybe they treat me like a insane cousin or uncle that they can't seem to avoid on a family gathering. I like to ask questions in class like what if two people in a contract hypothetical case are lovers or whether consent can be withdrawn halfway during sexual intercourse just prior to male orgasm.
The generation gap becomes really magnified when I attend a lecture with the LLB kids. In those classes, I feel like a Singaporean Bill Crosby. Subconsciously, like many older men, I really want to brow-beat the See-Gee-Nahs for the incoherent way they speak and their strange appearance. In the end I restrain myself because some of these kids are my seniors in Law School and may even end up coaching me for Moots. And of course, I should not pass judgment across generations, our struggles are quite different.
I actually feel ashamed to admit that the one thing which cheeses me off is the "SMU Smile". What happened to the angst, anomie and the general lack of confidence of an undergraduate ? Kids in my days have a lot of anxieties, how to get a job, how to get laid in a hostel and how to pay off the study loan, SMU undergraduates have this uncanny ability to project an inner sense of self confidence that I think has become the hallmark of the SMU brand which everyone else would either love or hate.
Today's article is about class anxiety. Buzzfeed has a really awesome article which talks about labelling someone as "basic" as a way to demonstrate their superiority in taste and class. In one lecture with the LLB folks, the lecturer picked on this kid because he wore an Abercrombie T-shirt. This is one brand I would never associate myself with. ( Unless it's to be a sole distributor )
After reading this article, I actually felt funny because I consider myself as having a taste beneath what would be considered basic in Singapore. After analyzing my personal taste and aesthetic, a friend concluded that I actually belong to a category called Normcore. It is a conscious striving to bland in taste and dress.
Being basic in Singapore is as follows :
I propose that investors should try to live a live below that level of "Basic" to reach financial goals.
Of course, perhaps at the end of the day, in class anxious Singapore we can easily afford to find other areas to be complete snobs at. Done properly, it will not make you a jerk and can protect your self esteem from the consumerist types around you.
My weapon of choice is in the books I read. An expression of superiority coming from appearance is quite shallow and with available credit, anyone can look good. I am delighted by conversation on the works of Lawrence Freedman, Steven Pinker, Thomas Piketty or perhaps Martin Seligman.
Of course, snobbery being snobbery, some books must be excluded from the club. I am openly contemptuous of folks who read and wax lyrical about the works by Dr. Phil, Paul Coelho, John Gray or Rhonda Byrnes.
This is stupidity of the highest order.
( In case you are wondering, I did read most of their works to figure out how to make books sell. )
The generation gap becomes really magnified when I attend a lecture with the LLB kids. In those classes, I feel like a Singaporean Bill Crosby. Subconsciously, like many older men, I really want to brow-beat the See-Gee-Nahs for the incoherent way they speak and their strange appearance. In the end I restrain myself because some of these kids are my seniors in Law School and may even end up coaching me for Moots. And of course, I should not pass judgment across generations, our struggles are quite different.
I actually feel ashamed to admit that the one thing which cheeses me off is the "SMU Smile". What happened to the angst, anomie and the general lack of confidence of an undergraduate ? Kids in my days have a lot of anxieties, how to get a job, how to get laid in a hostel and how to pay off the study loan, SMU undergraduates have this uncanny ability to project an inner sense of self confidence that I think has become the hallmark of the SMU brand which everyone else would either love or hate.
Today's article is about class anxiety. Buzzfeed has a really awesome article which talks about labelling someone as "basic" as a way to demonstrate their superiority in taste and class. In one lecture with the LLB folks, the lecturer picked on this kid because he wore an Abercrombie T-shirt. This is one brand I would never associate myself with. ( Unless it's to be a sole distributor )
After reading this article, I actually felt funny because I consider myself as having a taste beneath what would be considered basic in Singapore. After analyzing my personal taste and aesthetic, a friend concluded that I actually belong to a category called Normcore. It is a conscious striving to bland in taste and dress.
Being basic in Singapore is as follows :
- You shop at NTUC Fairprice.
- Eat in a foodcourt.
- Buy clothes from Forever 21 or Mango if you are woman. For a guy, maybe G2000 or Giordano.
- Drive a Toyota.
- One pair of decent does like Rockport maybe.
I propose that investors should try to live a live below that level of "Basic" to reach financial goals.
- Shop at Value$ or Sheng Siong.
- Eat at Kopitiam or hawker centre whenever possible.
- I wear and love Goldlion shirts although I am slowing wearing some Uniqlo to keep up with the times. A Gen-X uncle brand. Boomers wear CYC or 3 Rifles. ( No SPG will talk to you and no one will ask you whether you are gay if you wear these brands )
- A weekend Hyundai which I don't drive because I take public transport.
- Bata shoes.
Of course, perhaps at the end of the day, in class anxious Singapore we can easily afford to find other areas to be complete snobs at. Done properly, it will not make you a jerk and can protect your self esteem from the consumerist types around you.
My weapon of choice is in the books I read. An expression of superiority coming from appearance is quite shallow and with available credit, anyone can look good. I am delighted by conversation on the works of Lawrence Freedman, Steven Pinker, Thomas Piketty or perhaps Martin Seligman.
Of course, snobbery being snobbery, some books must be excluded from the club. I am openly contemptuous of folks who read and wax lyrical about the works by Dr. Phil, Paul Coelho, John Gray or Rhonda Byrnes.
This is stupidity of the highest order.
( In case you are wondering, I did read most of their works to figure out how to make books sell. )
Sunday, October 19, 2014
"Till All Are One !" - The Mechanics of Synergy.
It was a perfect storm for my personal finances this week.
First SMU decides to bring forward payment for my next semester of fees. The the markets had a series of sudden bearish moves while I lacked the funds the exploit this weakness. Then two things happened: My condominium TOP-ed and I have to write a couple of checks and my weekend car battery failed and we have to get AA to help us out next week.
Still, I spend so little money as a student these days, I've yet to touch my capital yet. Hope this can be sustained for 1 more year, after which all my fees would be settled.
Anyway, my class just had a mid-term exam. The value of the exam was not high but I think almost all of us put in more effort than what the score meant to our final results. I think this mid-term is a true test of our capabilities because it forces a student to consider trade-offs: Already on FB many classmates are complaining that focusing on a subject meant sacrificing others. This is a greater dilemma faced by all citizens : You have one life, do you study or play, start a family or work, invest or travel ?
Which leads me to consider the almost overused concept of synergy.
Synergy is the 6th Habit in Stephen Covey's 7 habits of Highly successful people. It is exemplified in the concept that the whole is greater than the sum of the parts. It has a darker purpose in the business world, after an M&A exercise, to synergize operations between two entities, it is quite normal to make a many employees redundant through a restructuring exercise,
I have two insights I picked up from Law School on the idea of Synergy.
The first insight is that if we see four subjects as four separate subjects, we are likely to be stretched. I think unlike engineering and finance school, legal subjects are a lot more similar to each other and concepts drawn from a topic can be used to reinforce another subject. Somehow I noticed that many contract cases can also be sued in tort. Our analytic and writing module probably applies to all other content driven modules like Contract and Criminal law. If we can actively apply and re-use some concepts across subjects, we can, in effect, study for multiple subjects while explicitly preparing for one. This can be one possible way out of our predicament.
The second insight concerns my active strategy which I think is working well so far in school.
Synergy requires very active and strategic time allocation. I noticed that students today have not changed for the past 15 years during my NUS days. The main method to cope with a stressful work-load is to live one day at a time. We're eminently human and will use out our time-slot for something which brings pleasure instead of pain. We also do not have a strategic use of our time to actively meet multiple objectives with one action.
My strategy so far might fly in the face of common sense. When an assignment "spawns", I rush it within 48 hours once I am sufficiently confident that all the material has been taught. No excuses, and it applies on individual and group assignments. Between leisure and work, I always choose work.
I realized that there are a couple of benefits, as I'm done with assignments 48 hours after they spawn, sometimes I can lift material from a previous assignment and cut and paste case references into my later assignments, returned assignments are used to remove mistakes from my submitted drafts to ensure that mistakes do note repeat itself, More interestingly, as the assignments cover the same material as the classes, doing the assignments early also prepare me for mid-term, throughout the term break I integrated assignment writing into test preparation. I can safely say that my rote learning load was halved since I was made intimately familiar with cases which I wrote about before.
So in summary, this is an exercise to cut into the root of what Synergy really means. It has confused the heck out of me since I read Steven Covey in the early 90s.
One possible idea is that all subjects are one. Investing is Life and Money is Happiness. Compounding your wealth can bring confidence and can help in school or at work because confidence always makes you a more magnetic personality.
The other approach is that time is the fuel which drives synergy and allows synthesis to take place. I think a person who learns about dividend investing at age 20 is better off than someone who picks up this skill at age 40.
Could it be possible that Time, managed well, also compounds itself like other asset classes ?
First SMU decides to bring forward payment for my next semester of fees. The the markets had a series of sudden bearish moves while I lacked the funds the exploit this weakness. Then two things happened: My condominium TOP-ed and I have to write a couple of checks and my weekend car battery failed and we have to get AA to help us out next week.
Still, I spend so little money as a student these days, I've yet to touch my capital yet. Hope this can be sustained for 1 more year, after which all my fees would be settled.
Anyway, my class just had a mid-term exam. The value of the exam was not high but I think almost all of us put in more effort than what the score meant to our final results. I think this mid-term is a true test of our capabilities because it forces a student to consider trade-offs: Already on FB many classmates are complaining that focusing on a subject meant sacrificing others. This is a greater dilemma faced by all citizens : You have one life, do you study or play, start a family or work, invest or travel ?
Which leads me to consider the almost overused concept of synergy.
Synergy is the 6th Habit in Stephen Covey's 7 habits of Highly successful people. It is exemplified in the concept that the whole is greater than the sum of the parts. It has a darker purpose in the business world, after an M&A exercise, to synergize operations between two entities, it is quite normal to make a many employees redundant through a restructuring exercise,
I have two insights I picked up from Law School on the idea of Synergy.
The first insight is that if we see four subjects as four separate subjects, we are likely to be stretched. I think unlike engineering and finance school, legal subjects are a lot more similar to each other and concepts drawn from a topic can be used to reinforce another subject. Somehow I noticed that many contract cases can also be sued in tort. Our analytic and writing module probably applies to all other content driven modules like Contract and Criminal law. If we can actively apply and re-use some concepts across subjects, we can, in effect, study for multiple subjects while explicitly preparing for one. This can be one possible way out of our predicament.
The second insight concerns my active strategy which I think is working well so far in school.
Synergy requires very active and strategic time allocation. I noticed that students today have not changed for the past 15 years during my NUS days. The main method to cope with a stressful work-load is to live one day at a time. We're eminently human and will use out our time-slot for something which brings pleasure instead of pain. We also do not have a strategic use of our time to actively meet multiple objectives with one action.
My strategy so far might fly in the face of common sense. When an assignment "spawns", I rush it within 48 hours once I am sufficiently confident that all the material has been taught. No excuses, and it applies on individual and group assignments. Between leisure and work, I always choose work.
I realized that there are a couple of benefits, as I'm done with assignments 48 hours after they spawn, sometimes I can lift material from a previous assignment and cut and paste case references into my later assignments, returned assignments are used to remove mistakes from my submitted drafts to ensure that mistakes do note repeat itself, More interestingly, as the assignments cover the same material as the classes, doing the assignments early also prepare me for mid-term, throughout the term break I integrated assignment writing into test preparation. I can safely say that my rote learning load was halved since I was made intimately familiar with cases which I wrote about before.
So in summary, this is an exercise to cut into the root of what Synergy really means. It has confused the heck out of me since I read Steven Covey in the early 90s.
One possible idea is that all subjects are one. Investing is Life and Money is Happiness. Compounding your wealth can bring confidence and can help in school or at work because confidence always makes you a more magnetic personality.
The other approach is that time is the fuel which drives synergy and allows synthesis to take place. I think a person who learns about dividend investing at age 20 is better off than someone who picks up this skill at age 40.
Could it be possible that Time, managed well, also compounds itself like other asset classes ?
Wednesday, October 08, 2014
The Shallow Search for Happiness.
I'm in the middle of my term 'break' in which I had to do even more work than a normal week at school. Test preparations and written papers took up almost half of it.
Now I'm taking a short break to update this blog as I think I've done enough preparation work and will let fate decide what happens in tomorrow's online test. This is the first time I'm getting a test where I have no idea what is to be tested. I was probably more prepared for my blood test this month which actually went really well. Turns out law school deprives one of unhealthy food such that I actually have a better cholesterol reading than a normal person and managed to control my blood below 8 for my HBA1C.
I'm writing today's article as a response to someone who intimated to me that he is disturbed by all the happy pictures his friends put up on Facebook, this makes him question the meaning of his own life. I consider this person very successful by Singaporean terms, so I was puzzled by his sharing. And if someone who is successful find a struggle in this, this is a problem which might be worthy of some thought.
Like in almost all recent postings, I will take a multi-model approach to this problem to decode this issue.
My first point is that most folks will simply say that they want to be happy. All life decisions are driven from the perspective of happiness. When a boomer or Gen-X say that they just want to be happy to justify a life decision, in my opinion, they are just as naive and shallow as Millenials who will justify any act by their YOLO philosophy, which I actually think is a more refined philosophy than what my generation has.
So first off, happiness on FB is a shallow idea which people use as a Swiss Army Knife to justify any life decision.
I will first refine this theory based on Martin Seligman's idea that Happiness is based on five components :
a) Pleasure - Classic meaning of happiness. Eating a lobster roll gives you pleasure.
b) Engagement - Mihaly's concept of Flow. You get this by doing interesting work.
c) Relationships - Have a great family and friends.
d) Meaning - You can put your work within a context of your existence.
e) Accomplishment - Meeting goals.
Voila ! Once we break happiness down into it's factor variables, the problem is not daunting anymore. Facebook pictures show people eating rich foods and visiting strange places. On the surface of it, people are not demonstrating happiness, they are only showing off one aspect of it, likely pleasure.
So my first solution to my friend's philosophical problem is that he needs to determine if these folks are really happy. Is one variable sufficient to do that ?
Ok, let's go further than Martin Seligman by introducing the concept of an objective or subjective test I learnt in Law School.
Something is subjective if they person claims to be the case. Pleasure, Engagement and Meaning should be held to the subjective test. Whatever makes you happy that makes you wanna post it on FB !
An objective test is independent of your internal state. Legally, judges create an imaginary creature known as a reasonable man to determine if the test passes or fails. Accomplishments and Relationships are judged externally. This is a public victory which does not depend on your subjective evaluation.
Some folks may in their course of lives focus on an internal scale which measures happiness. That may be wiser, but from the point of view of an outsider, this is internal and he cannot judge whether you are really happy or actually a nervous wreck ( Only the person can judge if he derived pleasure from the experience).
Of course, focusing on external/objective measures of happiness can backfire if it it is not accompanied by a private sense of victory.
In any case, we get choose what we want to do with our lives.
Suffering is a choice.
Studying like crazy during a term break is certainly not pleasurable, BUT :
a) The work is engaging.
b) We are struggling together as classmates and slowly building professional relationships.
c) We are rebuilding ourselves to be better.
d) We are getting a pretty prestigious credential.
Yup, for most of us, we don't have nice pictures to put up on Facebook, but look at what was gained when we decided to forego pleasure.
I think that's the consideration we need to make in light of the grander scheme of things.
Now I'm taking a short break to update this blog as I think I've done enough preparation work and will let fate decide what happens in tomorrow's online test. This is the first time I'm getting a test where I have no idea what is to be tested. I was probably more prepared for my blood test this month which actually went really well. Turns out law school deprives one of unhealthy food such that I actually have a better cholesterol reading than a normal person and managed to control my blood below 8 for my HBA1C.
I'm writing today's article as a response to someone who intimated to me that he is disturbed by all the happy pictures his friends put up on Facebook, this makes him question the meaning of his own life. I consider this person very successful by Singaporean terms, so I was puzzled by his sharing. And if someone who is successful find a struggle in this, this is a problem which might be worthy of some thought.
Like in almost all recent postings, I will take a multi-model approach to this problem to decode this issue.
My first point is that most folks will simply say that they want to be happy. All life decisions are driven from the perspective of happiness. When a boomer or Gen-X say that they just want to be happy to justify a life decision, in my opinion, they are just as naive and shallow as Millenials who will justify any act by their YOLO philosophy, which I actually think is a more refined philosophy than what my generation has.
So first off, happiness on FB is a shallow idea which people use as a Swiss Army Knife to justify any life decision.
I will first refine this theory based on Martin Seligman's idea that Happiness is based on five components :
a) Pleasure - Classic meaning of happiness. Eating a lobster roll gives you pleasure.
b) Engagement - Mihaly's concept of Flow. You get this by doing interesting work.
c) Relationships - Have a great family and friends.
d) Meaning - You can put your work within a context of your existence.
e) Accomplishment - Meeting goals.
Voila ! Once we break happiness down into it's factor variables, the problem is not daunting anymore. Facebook pictures show people eating rich foods and visiting strange places. On the surface of it, people are not demonstrating happiness, they are only showing off one aspect of it, likely pleasure.
So my first solution to my friend's philosophical problem is that he needs to determine if these folks are really happy. Is one variable sufficient to do that ?
Ok, let's go further than Martin Seligman by introducing the concept of an objective or subjective test I learnt in Law School.
Something is subjective if they person claims to be the case. Pleasure, Engagement and Meaning should be held to the subjective test. Whatever makes you happy that makes you wanna post it on FB !
An objective test is independent of your internal state. Legally, judges create an imaginary creature known as a reasonable man to determine if the test passes or fails. Accomplishments and Relationships are judged externally. This is a public victory which does not depend on your subjective evaluation.
Some folks may in their course of lives focus on an internal scale which measures happiness. That may be wiser, but from the point of view of an outsider, this is internal and he cannot judge whether you are really happy or actually a nervous wreck ( Only the person can judge if he derived pleasure from the experience).
Of course, focusing on external/objective measures of happiness can backfire if it it is not accompanied by a private sense of victory.
In any case, we get choose what we want to do with our lives.
Suffering is a choice.
Studying like crazy during a term break is certainly not pleasurable, BUT :
a) The work is engaging.
b) We are struggling together as classmates and slowly building professional relationships.
c) We are rebuilding ourselves to be better.
d) We are getting a pretty prestigious credential.
Yup, for most of us, we don't have nice pictures to put up on Facebook, but look at what was gained when we decided to forego pleasure.
I think that's the consideration we need to make in light of the grander scheme of things.
Tuesday, September 30, 2014
What tools in the Arts and Law can be used by an investor ?
After Hell week, my class started getting bombarded by essays and more written work so I am unable to put up more postings for quite a while but today is a good day, I just finished a 2,500 draft of an essay I was supposed to submit in November so it puts me ahead, to, well... do more advanced work for my classes.
One of the ideas I was obsessed with that ideas are "weaponizeable". Ideas from disparate fields can be integrated together to solve tough problems within a domain and even provide insight to practical problems in daily living.
It started during my engineering days when I was doing some object oriented programming. I was sort of into Philosophy then and became acquainted with Plato's Theory of Forms. I always felt that the way software engineers disrupted structured programming by coming with OOP in those days were really inspired by Plato. You need to define what an abstract idea of an object is, and then subsequently you need to write code to instantiate the object to be used in the real world.
Of course, it went on in my finance writings, I felt that frugality always had roots in Calvinism and Stoicism. Breaking away from the hedonic treadmill is very similar to the Buddhist concept of Nirvana. If you really want to delay gratification and save money, you are probably better served by reading Marcus Aurelius and Seneca than Robert Kiyosaki. If you want passive income, reading Jane Austen can help retool you into becoming a Mr. Darcy.
In Law School, I try to push the envelope in my presentations, recently taking a risk assessment model known in IT audit ( Risk = Probability of Loss x Loss amount ) I picked up when I did the CISA exams and rigorous applying it to resolving some problems with sentencing in crimes of negligence in Singapore.
I am trying to share this new approach of finding gems in the Liberal Arts and Law into looking at investment ideas.
Sociological Imagination
Sociological Imagination was taught to all final year Engineering students in NUS. The idea is simple - You take a simple social observation in your daily life and ask yourself, what are it's implications in the grader scheme of things. Sounds airy fairy enough ?
Not quite. Beyond the financial statements that you read, applying a helicopter view to your finances, can help assess the outcome of a investment scheme.
Say you like SPH as a stock, it's a great yielding instrument and you get to own a publications monopoly. Apply sociological imagination you know that SPH is closely tied to how far the government will go when it comes to freedom of speech. Most of the income is in Singapore dollars and you can expand your scope to include your projection of the Singapore economy.
I think most practitioners of the sociological imagination tool commit a lot of logical fallacies. You run the risk of reading too much into a incident. If one moron heckles a bunch of students with special needs, does it reflect upon the stupidity of society as whole, the failures of our education system, or it's simply a stupid moron with a very dubious personal agenda ?
Which leads to my second tool.
Ratio Decidendi
Lawyers have a way of confounding everyone with Latin terms. When we figure out the ratio of a case, we are just asking ourselves to summarise the judgement into one line which would be the same decision that will be made in future cases.
I think something magical happens when a divergent tool like the sociological imagination encounters a reductionist tool like ratio decidendi.
You get the best of both worlds.
SPH is a stock. It may be grounded by how the government views freedom of press and tied to the Singapore economy. But we are now required to ask ourselves what drives SPH stock, in particular, what drives its dividends for someone like me.
IMHO, my one sentence after all the considerations is that the dividends are driven by property rentals like Paragon Shopping Mall. Absent property in its current portfolio, I would not really like to own a publishing business which is rapidly being disrupted by e-books. If you arrive at the same conclusion as me - you might be better off looking at the cash flows from SPH REIT instead.
I have close to 30 stocks in my portfolio, having a key driver or ratio decidendi for the stocks in my portfolio allows me to balance my school and my finance activities and fine tunes my sixth sense when I read about the current affairs in the newspapers.
In conclusion, I think at this phase in my midlife, I am really trying to approach everything as a fox. Law school is quite foxy in nature as opposed to the hedgehog approach of engineering school.
A typical LLB student can at best approach a legal problem as an LLB student. I like to see myself as a little different, I will not hesitate to attack a legal from an engineer, programmer, project manager, auditor or a finance perspective.
The more models, the merrier.
One of the ideas I was obsessed with that ideas are "weaponizeable". Ideas from disparate fields can be integrated together to solve tough problems within a domain and even provide insight to practical problems in daily living.
It started during my engineering days when I was doing some object oriented programming. I was sort of into Philosophy then and became acquainted with Plato's Theory of Forms. I always felt that the way software engineers disrupted structured programming by coming with OOP in those days were really inspired by Plato. You need to define what an abstract idea of an object is, and then subsequently you need to write code to instantiate the object to be used in the real world.
Of course, it went on in my finance writings, I felt that frugality always had roots in Calvinism and Stoicism. Breaking away from the hedonic treadmill is very similar to the Buddhist concept of Nirvana. If you really want to delay gratification and save money, you are probably better served by reading Marcus Aurelius and Seneca than Robert Kiyosaki. If you want passive income, reading Jane Austen can help retool you into becoming a Mr. Darcy.
In Law School, I try to push the envelope in my presentations, recently taking a risk assessment model known in IT audit ( Risk = Probability of Loss x Loss amount ) I picked up when I did the CISA exams and rigorous applying it to resolving some problems with sentencing in crimes of negligence in Singapore.
I am trying to share this new approach of finding gems in the Liberal Arts and Law into looking at investment ideas.
Sociological Imagination
Sociological Imagination was taught to all final year Engineering students in NUS. The idea is simple - You take a simple social observation in your daily life and ask yourself, what are it's implications in the grader scheme of things. Sounds airy fairy enough ?
Not quite. Beyond the financial statements that you read, applying a helicopter view to your finances, can help assess the outcome of a investment scheme.
Say you like SPH as a stock, it's a great yielding instrument and you get to own a publications monopoly. Apply sociological imagination you know that SPH is closely tied to how far the government will go when it comes to freedom of speech. Most of the income is in Singapore dollars and you can expand your scope to include your projection of the Singapore economy.
I think most practitioners of the sociological imagination tool commit a lot of logical fallacies. You run the risk of reading too much into a incident. If one moron heckles a bunch of students with special needs, does it reflect upon the stupidity of society as whole, the failures of our education system, or it's simply a stupid moron with a very dubious personal agenda ?
Which leads to my second tool.
Ratio Decidendi
Lawyers have a way of confounding everyone with Latin terms. When we figure out the ratio of a case, we are just asking ourselves to summarise the judgement into one line which would be the same decision that will be made in future cases.
I think something magical happens when a divergent tool like the sociological imagination encounters a reductionist tool like ratio decidendi.
You get the best of both worlds.
SPH is a stock. It may be grounded by how the government views freedom of press and tied to the Singapore economy. But we are now required to ask ourselves what drives SPH stock, in particular, what drives its dividends for someone like me.
IMHO, my one sentence after all the considerations is that the dividends are driven by property rentals like Paragon Shopping Mall. Absent property in its current portfolio, I would not really like to own a publishing business which is rapidly being disrupted by e-books. If you arrive at the same conclusion as me - you might be better off looking at the cash flows from SPH REIT instead.
I have close to 30 stocks in my portfolio, having a key driver or ratio decidendi for the stocks in my portfolio allows me to balance my school and my finance activities and fine tunes my sixth sense when I read about the current affairs in the newspapers.
In conclusion, I think at this phase in my midlife, I am really trying to approach everything as a fox. Law school is quite foxy in nature as opposed to the hedgehog approach of engineering school.
A typical LLB student can at best approach a legal problem as an LLB student. I like to see myself as a little different, I will not hesitate to attack a legal from an engineer, programmer, project manager, auditor or a finance perspective.
The more models, the merrier.
Sunday, September 21, 2014
Going through hell week !
I'm going through hell week and have nothing much to share with the readers.
Apparently due to fate or some may even argue, good luck, SMU has decided to slam me with three subject presentations over 7 days and a graded legal memo, making this the most intense week in the entire semester. Things got so bad, I had to cancel my Dungeon's and Dragons game and I did not even bother monitoring my portfolio even with the talks of Scottish Independence and the actions of the Fed.
Here are some random thoughts until I can come up with something more interesting :
a) Becoming a student again can save money.
I noticed that my expenses have reached the three digit level this month. There were so many cases to crunch and books to read that it's impossible to spend on other pursuits, I can't even hang out with my friends after school.
b) Scottish Independence referendum turned out to be a non-invent.
I was following this pretty intensely and actually hoping that the Scots will decide to leave the United Kingdom. Singapore left almost 50 years ago and we're doing ok, But I acknowledge that economically it's better to stay together. Damn, I was hoping for a cheaper pound so that I can go shopping for RPG books at the Orcs Nest at Charrings Cross Street.
On the whole, people are rational and voting for the wallet sure beats some nationalistic sentiment.
c) Philip Holden's Critique on University rankings.
http://www.themalaysianinsider.com/sideviews/article/university-rankings-a-need-for-critical-reflection-philip-holden
.
If it is'nt for my punishing schedule, I would be railing at this article full time.
In Singapore, English Literature majors do pretty well and get fairly decent jobs. This needs to be sustained by local universities keeping their good reputations which means that we can't really negotiate with KPIs which rank universities. I rely on the good name of NUS and SMU when I look for jobs in the future, we're in a tough market where many US graduates might settle to work as Baristas in Starbucks.
I think the tirade is too similar with William Deresiewicz's appeal to bohemian authenticity over getting a solid job in the industry.
Hey we can't live on ideals. I say we keep the KPI. That might prevent more academics from holing up in their ivory towers.
Anyway, hope that I can write a better article next week !
Apparently due to fate or some may even argue, good luck, SMU has decided to slam me with three subject presentations over 7 days and a graded legal memo, making this the most intense week in the entire semester. Things got so bad, I had to cancel my Dungeon's and Dragons game and I did not even bother monitoring my portfolio even with the talks of Scottish Independence and the actions of the Fed.
Here are some random thoughts until I can come up with something more interesting :
a) Becoming a student again can save money.
I noticed that my expenses have reached the three digit level this month. There were so many cases to crunch and books to read that it's impossible to spend on other pursuits, I can't even hang out with my friends after school.
b) Scottish Independence referendum turned out to be a non-invent.
I was following this pretty intensely and actually hoping that the Scots will decide to leave the United Kingdom. Singapore left almost 50 years ago and we're doing ok, But I acknowledge that economically it's better to stay together. Damn, I was hoping for a cheaper pound so that I can go shopping for RPG books at the Orcs Nest at Charrings Cross Street.
On the whole, people are rational and voting for the wallet sure beats some nationalistic sentiment.
c) Philip Holden's Critique on University rankings.
http://www.themalaysianinsider.com/sideviews/article/university-rankings-a-need-for-critical-reflection-philip-holden
.
If it is'nt for my punishing schedule, I would be railing at this article full time.
In Singapore, English Literature majors do pretty well and get fairly decent jobs. This needs to be sustained by local universities keeping their good reputations which means that we can't really negotiate with KPIs which rank universities. I rely on the good name of NUS and SMU when I look for jobs in the future, we're in a tough market where many US graduates might settle to work as Baristas in Starbucks.
I think the tirade is too similar with William Deresiewicz's appeal to bohemian authenticity over getting a solid job in the industry.
Hey we can't live on ideals. I say we keep the KPI. That might prevent more academics from holing up in their ivory towers.
Anyway, hope that I can write a better article next week !
Saturday, September 13, 2014
What would I do if a start-up exit made me a multi-millionaire ?
Of recent interest is that we are starting to hear about successful start-up exits in Singapore. I really enjoyed reading about the interviews with these successful entrepreneurs so I am writing this speculative piece. I think Tech is very much on the rise here and with more talent becoming engineers, we could be hearing about a lot more success stories in the future.
Of course, being a small-time finance author and university student, I don't expect a real start-up multi-millionaire to consult me, I'm merely speculating as to what would I do if I struck such a large jackpot, please please allow me to indulge in this speculative exercise.
Here's what I will do with my multi-million jackpot :
a) Buy a house without a loan.
Maybe these founders already have a home. But I think that the first priority is to clear all housing loans on your primary property. As much as some loans are classified as 'good debt'. Having no loans provide a peaceful state of mind.
We need to distinguish the ability, willingness and need to take risk. As a successful business who already exited, you have the ability and willingness to take on more debt. But in my view, you don't need to do it.
b) Ensure that you have a reasonably risk-free source of passive income.
Once the home is secure, the next step is to ensure that all your basic needs can be provided by passive income. The source of such income can vary, you can buy rental property but I prefer REITs, business trusts and high yielding stocks. A portfolio which yields 5-7% is a reasonable number and can even provide a reasonable amount of growth. You need to determine how much of monthly expenses you have and invest a sizeable portfolio to cover your needs. $1,000,000 at 6% is a pretty solid $60,000 or $5,000 a month.
If you are unsure about how to start, begin with a selection of the largest blue chip companies in Singapore or an index ETF.
c) Get yourself educated financially.
I think this is where my advice is the most unconventional. I think start-up successes are very confident individuals and many of them want to jump into becoming a venture capitalist. I think that is not a good decision. Start-up founders should be aware of how risky tech investing is and they need to account for the fact that their success may make them over-confident in their assessment of these tech businesses.
Once your basic needs are met, the next step is a solid and rigorous financial education. You need the knowledge to cope when your private banker or financial advisor throw you a curve ball. As such, an 18 month investment for a Masters in Applied Finance in SMU is a really cheap buy if you can rack up a high GMAT score. Private bankers won't teach you about option greeks, free-cash flow, bond duration and convexity, but the good folks in SMU would.
I think that we should trust the bankers and financial advisors who try to give us advice. Bankers want you to keep your money with them, so they would prefer that you keep your risk low rather than you getting your high returns. I noticed that many HNW guys have a really conventional and low yielding blue chip portfolio - bankers just want to keep their businesses, they won't risk their capital. Financial advisers are worse - they only care about commissions.
If you want to take more risk, the only way is to educate yourself and eat your own dog-food.
So this is all I have for now. In many of these articles on the successful exits, I think there is too much emphasis on jumping back into the tech world with guns blazing and venture capital funding. Perhaps it might be better to take steps to secure your victory and ensure that your family is looked after for life, then take steps to cope with the complexities of finance.
I'm fairly sure that the financial models you learn can be used to value your future investment into that start-up that will change the world.
Of course, being a small-time finance author and university student, I don't expect a real start-up multi-millionaire to consult me, I'm merely speculating as to what would I do if I struck such a large jackpot, please please allow me to indulge in this speculative exercise.
Here's what I will do with my multi-million jackpot :
a) Buy a house without a loan.
Maybe these founders already have a home. But I think that the first priority is to clear all housing loans on your primary property. As much as some loans are classified as 'good debt'. Having no loans provide a peaceful state of mind.
We need to distinguish the ability, willingness and need to take risk. As a successful business who already exited, you have the ability and willingness to take on more debt. But in my view, you don't need to do it.
b) Ensure that you have a reasonably risk-free source of passive income.
Once the home is secure, the next step is to ensure that all your basic needs can be provided by passive income. The source of such income can vary, you can buy rental property but I prefer REITs, business trusts and high yielding stocks. A portfolio which yields 5-7% is a reasonable number and can even provide a reasonable amount of growth. You need to determine how much of monthly expenses you have and invest a sizeable portfolio to cover your needs. $1,000,000 at 6% is a pretty solid $60,000 or $5,000 a month.
If you are unsure about how to start, begin with a selection of the largest blue chip companies in Singapore or an index ETF.
c) Get yourself educated financially.
I think this is where my advice is the most unconventional. I think start-up successes are very confident individuals and many of them want to jump into becoming a venture capitalist. I think that is not a good decision. Start-up founders should be aware of how risky tech investing is and they need to account for the fact that their success may make them over-confident in their assessment of these tech businesses.
Once your basic needs are met, the next step is a solid and rigorous financial education. You need the knowledge to cope when your private banker or financial advisor throw you a curve ball. As such, an 18 month investment for a Masters in Applied Finance in SMU is a really cheap buy if you can rack up a high GMAT score. Private bankers won't teach you about option greeks, free-cash flow, bond duration and convexity, but the good folks in SMU would.
I think that we should trust the bankers and financial advisors who try to give us advice. Bankers want you to keep your money with them, so they would prefer that you keep your risk low rather than you getting your high returns. I noticed that many HNW guys have a really conventional and low yielding blue chip portfolio - bankers just want to keep their businesses, they won't risk their capital. Financial advisers are worse - they only care about commissions.
If you want to take more risk, the only way is to educate yourself and eat your own dog-food.
So this is all I have for now. In many of these articles on the successful exits, I think there is too much emphasis on jumping back into the tech world with guns blazing and venture capital funding. Perhaps it might be better to take steps to secure your victory and ensure that your family is looked after for life, then take steps to cope with the complexities of finance.
I'm fairly sure that the financial models you learn can be used to value your future investment into that start-up that will change the world.
Saturday, September 06, 2014
September 2014 Update : From Retiree to Law Student.
I've just survived three weeks of law school, just sharing a personal update to keep in touch with readers.
a) Drowning in legal cases.
Right now, the largest part of my my life is tackling legal cases. In SMU, merely reading up on cases and getting a general gist of it is not enough. As we can be called upon to introduce the cases on the fly, we will need to be able to demonstrate that we understand the cases well, so reading off text is not a good idea. A large part of my current life is figuring out what is the minimum reading I will need to convince myself that I know enough. If I get too obsessed with the details, I will not have time to cover all the cases. If I am too light on my reading and skim too much, it may affect class participation grades. As in all things, being absolute noobs, we are trying strike the perfect balance.
Although I can say that I'm actually happier spending all my time reading about cases which are really relevant to that investor part of me, this aspect of my return to University life has not met my personal expectations.
I was joking to my classmates that I see a law degree almost as a last bastion of liberal arts in pragmatic Singapore and want to pick up skills in rhetoric - career be damned - but the intensity and rigour of the course along the pressure to seek a training contract, internship and then a career is starting to weigh heavily in my mind.
b) Read Excellent Sheep by William Deresiewicz
I am glad that before bed and in the trains, I was able to read this piece of work which my cousin introduced to me. Perhaps in a later post I will contextualise this piece of work for Singaporeans.
The author paints Ivy League students as sheep who get shoehorned into society's definition of success and lack the courage to explore the world on their own terms. I think the law and medical students are the closest things to Ivy Leaguers in Singapore so it strikes a chord: I had a good read but I remain unconvinced by the author on many major points.
Success and accomplishment are as important as developing a philosophy of life. The author's insistence that students develop that bohemian outlook on life is laughable, Singaporeans do not live in a welfare state ( Unless you have dividends ) and neither do many Americans. Reading the Great Books is useful, but thinking deeply in a vacuum is worthless. Austen and Eliot would be much more useful if the reader can already write code, draft laws or create investment portfolios.
The same problem infects all the English Literature types who recently took up so much limelight in the Singapore news.
Taken to the extreme, English Literature is a religion, it has it holy books by Eliot, Austen and Shakespeare. Literature has it's own fundamentalists, fanatics and zealots. Science and engineering, at least, is falsifiability to keep scientists humble which distinguishes it from the literary arts.
Of course, on the other hand, legal education in SMU is the opposite extreme compared to the bohemian authenticity espoused by the author. The case load I get occupies so much of my time that I wish to have more time to reflect upon my views on humanity and philosophy towards life. So reading this book was done at the right time: It looks like me and my classmates are heading in the direction of becoming Excellent Sheep just as Deresiewicz had theorised.
c) Personal finances
September is a good paying month for dividends, I have already socked aside some cash to pay for next semester of fees. I have stopped tracking my net worth for now and will make minor changes to my portfolio to increase my diversification further. I think the newer REITs and Business trusts launched in 2014 may come under some selling pressure so I expect to do some bargain hunting before the month is over.
My aim so far is to retain or grow my net-worth throughout my stay in law school. This way I can reduce some of that pressure to get a training contract and really focus on thinking like a legal professional, which I think is the real holy grail of getting back to school in mid-life.
d) Other areas of my life
Of particular concern is that I have not been looking after my diet and exercise lately. Mooncake festival always gives me a sugar high and I've been neglecting my running to clear all my cases and consolidate my understanding of the law.
Looks like I need to buck up on my health next week.
Hopefully I can do up another blog article early next week.
a) Drowning in legal cases.
Right now, the largest part of my my life is tackling legal cases. In SMU, merely reading up on cases and getting a general gist of it is not enough. As we can be called upon to introduce the cases on the fly, we will need to be able to demonstrate that we understand the cases well, so reading off text is not a good idea. A large part of my current life is figuring out what is the minimum reading I will need to convince myself that I know enough. If I get too obsessed with the details, I will not have time to cover all the cases. If I am too light on my reading and skim too much, it may affect class participation grades. As in all things, being absolute noobs, we are trying strike the perfect balance.
Although I can say that I'm actually happier spending all my time reading about cases which are really relevant to that investor part of me, this aspect of my return to University life has not met my personal expectations.
I was joking to my classmates that I see a law degree almost as a last bastion of liberal arts in pragmatic Singapore and want to pick up skills in rhetoric - career be damned - but the intensity and rigour of the course along the pressure to seek a training contract, internship and then a career is starting to weigh heavily in my mind.
b) Read Excellent Sheep by William Deresiewicz
I am glad that before bed and in the trains, I was able to read this piece of work which my cousin introduced to me. Perhaps in a later post I will contextualise this piece of work for Singaporeans.
The author paints Ivy League students as sheep who get shoehorned into society's definition of success and lack the courage to explore the world on their own terms. I think the law and medical students are the closest things to Ivy Leaguers in Singapore so it strikes a chord: I had a good read but I remain unconvinced by the author on many major points.
Success and accomplishment are as important as developing a philosophy of life. The author's insistence that students develop that bohemian outlook on life is laughable, Singaporeans do not live in a welfare state ( Unless you have dividends ) and neither do many Americans. Reading the Great Books is useful, but thinking deeply in a vacuum is worthless. Austen and Eliot would be much more useful if the reader can already write code, draft laws or create investment portfolios.
The same problem infects all the English Literature types who recently took up so much limelight in the Singapore news.
Taken to the extreme, English Literature is a religion, it has it holy books by Eliot, Austen and Shakespeare. Literature has it's own fundamentalists, fanatics and zealots. Science and engineering, at least, is falsifiability to keep scientists humble which distinguishes it from the literary arts.
Of course, on the other hand, legal education in SMU is the opposite extreme compared to the bohemian authenticity espoused by the author. The case load I get occupies so much of my time that I wish to have more time to reflect upon my views on humanity and philosophy towards life. So reading this book was done at the right time: It looks like me and my classmates are heading in the direction of becoming Excellent Sheep just as Deresiewicz had theorised.
c) Personal finances
September is a good paying month for dividends, I have already socked aside some cash to pay for next semester of fees. I have stopped tracking my net worth for now and will make minor changes to my portfolio to increase my diversification further. I think the newer REITs and Business trusts launched in 2014 may come under some selling pressure so I expect to do some bargain hunting before the month is over.
My aim so far is to retain or grow my net-worth throughout my stay in law school. This way I can reduce some of that pressure to get a training contract and really focus on thinking like a legal professional, which I think is the real holy grail of getting back to school in mid-life.
d) Other areas of my life
Of particular concern is that I have not been looking after my diet and exercise lately. Mooncake festival always gives me a sugar high and I've been neglecting my running to clear all my cases and consolidate my understanding of the law.
Looks like I need to buck up on my health next week.
Hopefully I can do up another blog article early next week.
Friday, August 29, 2014
Learning how to learn.
I enrolled into the course Learning How to Learn: Powerful mental tools to help you master tough subjects by Dr. Terrence Sejnowski and Dr. Barbara Oakley as part of my personal preparation to go back to law school. If you are an adult learner, I strongly recommend that you signed up for the course because there has been many new developments in field of adult learning since the last time I was at school.
This blog post is part of the project submission of this online course.
As part of the course requirement, I will talk about three major things I picked up from this course and how I am in the process of trying to apply myself in law school.
a) Focused and Diffused modes of learning.
The first key learning of learning that there are two modes of learning. When you are aggressively studying, like in my case, when I am trying to read a legal case or a text-book, what I am doing is focused learning. This is the hardest part about law school. Particularly alien to most engineers are Latin terms like Ejusdem Generis, Stare Decisis and Oribter Dictum. I would even go further to say that event he English terms are alien to most readers. What does it mean when something was based on a demurrer ? What happens during a promulgation ?
Prior to this online course, I was very old school when it comes to learning. Learning is rigorously attacking problems and solving sample test questions.
Fortunately for us, there is an alternative form of learning: Diffused learning is allowing your mind to rest. It occurs when you are taking a stroll and having a walk. This allows all the work that I've done during focused learning to settle down in my brain. With diffused learning, my mind is relaxed and allows me to form Eureka moments to link ideas together holistically.
My primary form of diffused learning is to play Dungeons & Dragons with my friends. In a tabletop RPG game, I play the role of a Dungeon Master (DM) , someone who referees a game and ensures that it runs smoothly. A role of Dungeon Master is very similar to that of a judge, except a whole lot more fun. Players will make up all sorts of rulings where an ambiguity takes places, it is up to the DM to arbitrate disputes.
One example in my game are the rules of a spell ( In D&D 1st Edition ) called Firetrap.
The rules state that:
You can cast a Firetrap at at any closeable item. Eg. A chest, a cover or a lid.
A mischievous player, reasoning that his mouth is closeable, wanted to cast Firetrap spell on his mouth and bite a fellow player character.
In ordinary cases, most DMs would not have a sufficient to cover strange rule anachronisms in the game, unless this DM is also legally trained.
To resolve the issue, I was able to determine that a purposive interpretation of the rules mean that the spell was meant to be cast on inanimate objects. Using the concept of Ejusdem Generis, a reasonable ruling would be that a mouth is a living organ and is not the same category as a chest, cover or lid.
This is classic diffused thinking at work. I get to play part of a judge in a stress-free situation and my players constantly come up with crazy game rulings to test my powers of adjudication which reinforces my understanding of legal theory.
b) Metaphor, Visualization and Storytelling
The other concept I learnt in this class is the power of metaphor, visualization and storytelling. I have employed this concept to assist me in memorizing legal cases.
I noticed that a few classmates actually used Mind Maps to reinforce their recall of materials. I thought, how could I take this step further and turn the crunching of legal cases into a game. At the same time, I was playing with my daughter and noticed that my wife was having a hard time trying to get her to draw anything on a piece of paper.
Then I had an eureka moment - What if I could play Pictionary with legal professionals ?
I would draw a graphical depiction of the cases and get lawyers to guess what they are. The above diagram shows the various pre-Donoghue cases which leads to formation of the Law of Torts. From top to bottom they are as follows : Winterbottom v Wright, Heaven v Pender, George v Skivington and the famous case of Donoghue v Stevenson.
As I move towards exam preparation, I will of course create mindmaps but I will also use pictionary to test my understanding of cases.
c) Life-long learning and broadening of one's passions.
The final point I would like to make is that is that the journey of learning never stops. Having done engineering and finance, many people would think that this is enough for a more than a lifetime.
I choose not to think that I have invested my time in three disparate fields but instead see my legal training as extensions to what I have learnt in engineering and finance school.
Ultimately, this can lead to interesting questions and developing new capabilities :
a) Can a random forest algorithm operate on a data-frame of key legal terms used by a prosecutor to predict the chances of a favorable verdict ?
b) How would a verdict of negligence affect the next dividend cash flow for a business trust ?
c) If you wish to draft a regulation to prevent the use of machine learning in a financial market, how would you word the regulation ?
Knowledge comes before Wealth.
Wealth comes before Power.
With power, you can have all the toys and fun you aspire to in your life.
This blog post is part of the project submission of this online course.
As part of the course requirement, I will talk about three major things I picked up from this course and how I am in the process of trying to apply myself in law school.
a) Focused and Diffused modes of learning.
The first key learning of learning that there are two modes of learning. When you are aggressively studying, like in my case, when I am trying to read a legal case or a text-book, what I am doing is focused learning. This is the hardest part about law school. Particularly alien to most engineers are Latin terms like Ejusdem Generis, Stare Decisis and Oribter Dictum. I would even go further to say that event he English terms are alien to most readers. What does it mean when something was based on a demurrer ? What happens during a promulgation ?
Prior to this online course, I was very old school when it comes to learning. Learning is rigorously attacking problems and solving sample test questions.
Fortunately for us, there is an alternative form of learning: Diffused learning is allowing your mind to rest. It occurs when you are taking a stroll and having a walk. This allows all the work that I've done during focused learning to settle down in my brain. With diffused learning, my mind is relaxed and allows me to form Eureka moments to link ideas together holistically.
My primary form of diffused learning is to play Dungeons & Dragons with my friends. In a tabletop RPG game, I play the role of a Dungeon Master (DM) , someone who referees a game and ensures that it runs smoothly. A role of Dungeon Master is very similar to that of a judge, except a whole lot more fun. Players will make up all sorts of rulings where an ambiguity takes places, it is up to the DM to arbitrate disputes.
One example in my game are the rules of a spell ( In D&D 1st Edition ) called Firetrap.
The rules state that:
You can cast a Firetrap at at any closeable item. Eg. A chest, a cover or a lid.
A mischievous player, reasoning that his mouth is closeable, wanted to cast Firetrap spell on his mouth and bite a fellow player character.
In ordinary cases, most DMs would not have a sufficient to cover strange rule anachronisms in the game, unless this DM is also legally trained.
To resolve the issue, I was able to determine that a purposive interpretation of the rules mean that the spell was meant to be cast on inanimate objects. Using the concept of Ejusdem Generis, a reasonable ruling would be that a mouth is a living organ and is not the same category as a chest, cover or lid.
This is classic diffused thinking at work. I get to play part of a judge in a stress-free situation and my players constantly come up with crazy game rulings to test my powers of adjudication which reinforces my understanding of legal theory.
b) Metaphor, Visualization and Storytelling
The other concept I learnt in this class is the power of metaphor, visualization and storytelling. I have employed this concept to assist me in memorizing legal cases.
I noticed that a few classmates actually used Mind Maps to reinforce their recall of materials. I thought, how could I take this step further and turn the crunching of legal cases into a game. At the same time, I was playing with my daughter and noticed that my wife was having a hard time trying to get her to draw anything on a piece of paper.
Then I had an eureka moment - What if I could play Pictionary with legal professionals ?
I would draw a graphical depiction of the cases and get lawyers to guess what they are. The above diagram shows the various pre-Donoghue cases which leads to formation of the Law of Torts. From top to bottom they are as follows : Winterbottom v Wright, Heaven v Pender, George v Skivington and the famous case of Donoghue v Stevenson.
As I move towards exam preparation, I will of course create mindmaps but I will also use pictionary to test my understanding of cases.
c) Life-long learning and broadening of one's passions.
The final point I would like to make is that is that the journey of learning never stops. Having done engineering and finance, many people would think that this is enough for a more than a lifetime.
I choose not to think that I have invested my time in three disparate fields but instead see my legal training as extensions to what I have learnt in engineering and finance school.
Ultimately, this can lead to interesting questions and developing new capabilities :
a) Can a random forest algorithm operate on a data-frame of key legal terms used by a prosecutor to predict the chances of a favorable verdict ?
b) How would a verdict of negligence affect the next dividend cash flow for a business trust ?
c) If you wish to draft a regulation to prevent the use of machine learning in a financial market, how would you word the regulation ?
Knowledge comes before Wealth.
Wealth comes before Power.
With power, you can have all the toys and fun you aspire to in your life.
Thursday, August 28, 2014
What does ASPIRE, plunging legal starting salaries and the ACS-LTA fracas have in common ?
As it turns out three recent events have something in common.
ASPIRE is government's much welcomed attempt to officially acknowledge the importance of Polytechnic and ITE graduates in our economy. I think investors will be very happy with this development because if executed correctly, Singapore will have a prosperous and vibrant middle-class and they won't feel very strongly about delaying their entrance into the working world just to get a piece of paper. My only caution is that for this to work, the foreign labor participation must be curbed. No sane employer will take on our Poly and ITE grads if Masters degree graduate from other parts of the world will cost half the price.
The second issue is that now we law students have been asked to keep our expectations low as the supply of incoming law graduates outstrip demand. Contrary to what you might think, I actually welcome this development. The over-supply is not due to foreigners but locals with overseas law degrees and we should not begrudge our fellow citizens. Singaporeans deserve a fair fight for a training contract. Imagine the kind of competition we engineers were made to face for the past 15 years : Foreign competition has been so relentless, engineering salaries have made technology one of the worse sectors to get into in this country.Compared to what engineers faced, what's happening to lawyers is nothing.
The third event is very interesting.
ACS gets their first Wee Shu Min incident !
There is a lot of public anger over ACS's booking of six MRT trains to get to a stadium. To ACS' credit, the transport was well thought-out and public inconvenience was minimized. But I doubt this issue is about public inconvenience. As my lecturer would have said, " How dare you ! " The public's concern is whether can a group perceived to be well-to-do, marshal state resources for their benefit simply because they can and have the funds to do so. I predict a very public rebuke directed at MRT to appease the masses, but I also expect private censure to be very minimal. LTA needs to play their cards well to handle this incident: The optimal move is public censure and private indifference.
To help you think about this issue further, let me ask you this :
a) If RI or HCI books the trains, how would react to this incident ?
b) If ITE booked the trains, how would you react differently ?
c) What if lawyers or the Adminsitrative Service booked an MRT train to attend a dinner and dance ?
I believe the reactions would all be very different.
There is a central thread in what policy makers are trying to do - That central thread in all these events is Game Balance.
Imagine Singapore as a Diablo III game, would it make sense to design a country like this :
a) If you are ACS, RI, doctor or a lawyer, you play the game at Easy Mode.
b) Other graduates play the game at Normal Mode.
c) If you are Poly, you play the game at Hard mode.
d) If you are ITE, you play at Torment 6.
e) If your are a scholar, you play at God mode.
It won't make sense to do this to people. You can only push us this far.
Good games require great game balance. That's why Diablo III repeatedly patches itself.
After 2011, to reduce social and economic inequality, the government has to do two things:
The first is to generate a better career path for ITE and Poly graduates with a better quality of life. I urge the investor community to welcome this change because our economy can benefit from a vibrant middle class. More money for middle class, more revenue, and for me, higher rents to collect. Support this out of self-interest.
The second and harder consequence to bear is that the strong will be nerfed or brought down. As the inequalities need to be addressed before the next elections, some people need to be brought to the average watermark.
It begins with lawyers, but it won't end there.
I predict the following :
a) Doctors will increasingly face foreign competition if only to keep medical costs down.
b) Regulation will make banking sector less attractive then the high tech sector.
c) Investors will face higher interest rates and lower tax breaks, but Singapore will only levy capital gains and dividend taxes as a last resort.
d) There is one Phd driving a cab. We have yet to see a lawyer or doctor do this.
In 2011, Singaporeans have started becoming very vocal against social inequality. In fact, I would want to believe that once we resolve our transport woes, that is the only thing Singaporeans have to gripe about.
What we are seeing is the beginnings of a resolution of this unhappiness.
This is only the tip of the ice-berg.
I leave you to decide if the second consequence is something that is fair to some Singaporeans. I am undecided for now.
[ A friend informed me that my article is very similar to this one : http://whatever.scalzi.com/2012/05/15/straight-white-male-the-lowest-difficulty-setting-there-is/
But hey, let's not go there. In the Singaporean context it can be seditious.]
ASPIRE is government's much welcomed attempt to officially acknowledge the importance of Polytechnic and ITE graduates in our economy. I think investors will be very happy with this development because if executed correctly, Singapore will have a prosperous and vibrant middle-class and they won't feel very strongly about delaying their entrance into the working world just to get a piece of paper. My only caution is that for this to work, the foreign labor participation must be curbed. No sane employer will take on our Poly and ITE grads if Masters degree graduate from other parts of the world will cost half the price.
The second issue is that now we law students have been asked to keep our expectations low as the supply of incoming law graduates outstrip demand. Contrary to what you might think, I actually welcome this development. The over-supply is not due to foreigners but locals with overseas law degrees and we should not begrudge our fellow citizens. Singaporeans deserve a fair fight for a training contract. Imagine the kind of competition we engineers were made to face for the past 15 years : Foreign competition has been so relentless, engineering salaries have made technology one of the worse sectors to get into in this country.Compared to what engineers faced, what's happening to lawyers is nothing.
The third event is very interesting.
ACS gets their first Wee Shu Min incident !
There is a lot of public anger over ACS's booking of six MRT trains to get to a stadium. To ACS' credit, the transport was well thought-out and public inconvenience was minimized. But I doubt this issue is about public inconvenience. As my lecturer would have said, " How dare you ! " The public's concern is whether can a group perceived to be well-to-do, marshal state resources for their benefit simply because they can and have the funds to do so. I predict a very public rebuke directed at MRT to appease the masses, but I also expect private censure to be very minimal. LTA needs to play their cards well to handle this incident: The optimal move is public censure and private indifference.
To help you think about this issue further, let me ask you this :
a) If RI or HCI books the trains, how would react to this incident ?
b) If ITE booked the trains, how would you react differently ?
c) What if lawyers or the Adminsitrative Service booked an MRT train to attend a dinner and dance ?
I believe the reactions would all be very different.
There is a central thread in what policy makers are trying to do - That central thread in all these events is Game Balance.
Imagine Singapore as a Diablo III game, would it make sense to design a country like this :
a) If you are ACS, RI, doctor or a lawyer, you play the game at Easy Mode.
b) Other graduates play the game at Normal Mode.
c) If you are Poly, you play the game at Hard mode.
d) If you are ITE, you play at Torment 6.
e) If your are a scholar, you play at God mode.
It won't make sense to do this to people. You can only push us this far.
Good games require great game balance. That's why Diablo III repeatedly patches itself.
After 2011, to reduce social and economic inequality, the government has to do two things:
The first is to generate a better career path for ITE and Poly graduates with a better quality of life. I urge the investor community to welcome this change because our economy can benefit from a vibrant middle class. More money for middle class, more revenue, and for me, higher rents to collect. Support this out of self-interest.
The second and harder consequence to bear is that the strong will be nerfed or brought down. As the inequalities need to be addressed before the next elections, some people need to be brought to the average watermark.
It begins with lawyers, but it won't end there.
I predict the following :
a) Doctors will increasingly face foreign competition if only to keep medical costs down.
b) Regulation will make banking sector less attractive then the high tech sector.
c) Investors will face higher interest rates and lower tax breaks, but Singapore will only levy capital gains and dividend taxes as a last resort.
d) There is one Phd driving a cab. We have yet to see a lawyer or doctor do this.
In 2011, Singaporeans have started becoming very vocal against social inequality. In fact, I would want to believe that once we resolve our transport woes, that is the only thing Singaporeans have to gripe about.
What we are seeing is the beginnings of a resolution of this unhappiness.
This is only the tip of the ice-berg.
I leave you to decide if the second consequence is something that is fair to some Singaporeans. I am undecided for now.
[ A friend informed me that my article is very similar to this one : http://whatever.scalzi.com/2012/05/15/straight-white-male-the-lowest-difficulty-setting-there-is/
But hey, let's not go there. In the Singaporean context it can be seditious.]
Monday, August 25, 2014
Beyond second skilling...
Thought I should share with everyone my view on NTUC PME's drive to promote second skilling amongst PMEs in Singapore.
Second-skilling is a straight forward concept. It encourages Singaporeans to develop hobbies which can be monetized. A manager in manufacturing plant can develop a hobby in photography and eventually gains a degree of protection against job loss when he starts taking professional photographs.
In the absence of actual data of folks monetizing their interests, I would like to share my personal experience.
My biggest success with second-skilling came with teaching myself how to invest. Investing is a great secondary skill to develop although the results can vary. What I felt worked for me was that I was willing to go all the way to become a competent investor. I was eager and happy to study all the qualifications out there using my leisure time because I wanted to become my own private banker and financial advisor. Of course, this success was also fueled by my willingness to pump capital into my portfolio.
However, not all of my hobbies end up earning a profit, I would consider my foray into writing a lukewarm success, or even a financial failure. Out of the three physical books I published, only one broke even. My e-book sales are very minimal, earning about $1.50 on a good month from Amazon. When I started writing, I was mainly trying to crystallize my thoughts and investment ideas with the secondary objective of building up my personal brand, but my investment of time and money was small - only about $15,000 for all three books.
The jury is out on whether my third-skilling attempt of getting into Law School would pay-off over the long term. There are a lot of concerns on where the legal industry is heading over the next 10 years. But for reasons I will share later, I'm still optimistic that I can find a humble role in spite of the oversupply of lawyers in Singapore.
Ok, now the really theoretical part of this discussion.
I believe that a model on second skilling can be derived from Solow's Growth Model in economics.
Without getting into the gory details, imagine growth to be a function of three inputs Capital, Labor and Innovation.
In Solow's Growth model, under early phases of growth, you can keep injecting capital and labor into the effort and an economy will grow fairly quickly for a decade or so, after which it will plateau unless you find ways to innovate and differentiate the economy from its peers.
If we apply this model to second skilling, here are some useful insights.
For second skilling to work, you need to put in time and money to get to this point when people will pay you to indulge in your hobby. If you are a photographer, you may need to practice your skills in shooting and composition. You may also need to constantly upgrade your gear and it can cost you loads of money. This explains why some of my efforts bear fruit while other attempts fail. This also provides me with some optimistic feelings due to my substantial time and money commitments to crack legal cases in SMU.
The next insight is that hobbies are fun and a lot of people would drop their current day jobs if they can make money from what they perceive as fun : this limits how far you can go with your hobby. Monetizing a hobby can be Red Ocean territory.
The remedy for reaching a plateau to how much you can extract from your hobby is innovation. You need to apply your hobby in a novel or niche way. Example, folks who love painting Warhammer miniatures can differentiate from other by winning the Golden Daemon Award and even get into giving painting classes to secondary school kids. You can create a new product or seminar from your love of miniatures painting.
I'm not spared from the innovation requirement. Before I graduate, I will need to find a niche within the legal industry which would have to combine my technical skills, investment know-how and new found legal analysis skills to convince someone to take me in.
So in summary, do proceed to monetize your hobbies as recommended by NTUC, a secondary source of income is always a good thing :
a) You need to pour in money and time for your hobby to bear fruit, but there are physical limits to how far you can go with this. eg. Once you get the top of the line camera, paid for the Photoshop license, everything else is based on your skill.
b) If the hobby is especially common, you need to make your attempts unique and distinguish your product offering to the market.
Second-skilling is a straight forward concept. It encourages Singaporeans to develop hobbies which can be monetized. A manager in manufacturing plant can develop a hobby in photography and eventually gains a degree of protection against job loss when he starts taking professional photographs.
In the absence of actual data of folks monetizing their interests, I would like to share my personal experience.
My biggest success with second-skilling came with teaching myself how to invest. Investing is a great secondary skill to develop although the results can vary. What I felt worked for me was that I was willing to go all the way to become a competent investor. I was eager and happy to study all the qualifications out there using my leisure time because I wanted to become my own private banker and financial advisor. Of course, this success was also fueled by my willingness to pump capital into my portfolio.
However, not all of my hobbies end up earning a profit, I would consider my foray into writing a lukewarm success, or even a financial failure. Out of the three physical books I published, only one broke even. My e-book sales are very minimal, earning about $1.50 on a good month from Amazon. When I started writing, I was mainly trying to crystallize my thoughts and investment ideas with the secondary objective of building up my personal brand, but my investment of time and money was small - only about $15,000 for all three books.
The jury is out on whether my third-skilling attempt of getting into Law School would pay-off over the long term. There are a lot of concerns on where the legal industry is heading over the next 10 years. But for reasons I will share later, I'm still optimistic that I can find a humble role in spite of the oversupply of lawyers in Singapore.
Ok, now the really theoretical part of this discussion.
I believe that a model on second skilling can be derived from Solow's Growth Model in economics.
Without getting into the gory details, imagine growth to be a function of three inputs Capital, Labor and Innovation.
In Solow's Growth model, under early phases of growth, you can keep injecting capital and labor into the effort and an economy will grow fairly quickly for a decade or so, after which it will plateau unless you find ways to innovate and differentiate the economy from its peers.
If we apply this model to second skilling, here are some useful insights.
For second skilling to work, you need to put in time and money to get to this point when people will pay you to indulge in your hobby. If you are a photographer, you may need to practice your skills in shooting and composition. You may also need to constantly upgrade your gear and it can cost you loads of money. This explains why some of my efforts bear fruit while other attempts fail. This also provides me with some optimistic feelings due to my substantial time and money commitments to crack legal cases in SMU.
The next insight is that hobbies are fun and a lot of people would drop their current day jobs if they can make money from what they perceive as fun : this limits how far you can go with your hobby. Monetizing a hobby can be Red Ocean territory.
The remedy for reaching a plateau to how much you can extract from your hobby is innovation. You need to apply your hobby in a novel or niche way. Example, folks who love painting Warhammer miniatures can differentiate from other by winning the Golden Daemon Award and even get into giving painting classes to secondary school kids. You can create a new product or seminar from your love of miniatures painting.
I'm not spared from the innovation requirement. Before I graduate, I will need to find a niche within the legal industry which would have to combine my technical skills, investment know-how and new found legal analysis skills to convince someone to take me in.
So in summary, do proceed to monetize your hobbies as recommended by NTUC, a secondary source of income is always a good thing :
a) You need to pour in money and time for your hobby to bear fruit, but there are physical limits to how far you can go with this. eg. Once you get the top of the line camera, paid for the Photoshop license, everything else is based on your skill.
b) If the hobby is especially common, you need to make your attempts unique and distinguish your product offering to the market.
Thursday, August 21, 2014
Pushing the Delay of Gratification to its logical extreme.
I'll start with a personal update.
I'm almost with my first week of school in SMU's Doctor of Jurisprudence or JD program.
This is, by far, the hardest course I've ever taken in my life considering that I have done NUS engineering school, NUS's Masters in Applied Finance and passed all three CFA exams.
Prior to the start of the semester, we would have already completed reading about 30 cases, done two online quizzes, and even attempted to tackle a few problems. SMU places a large emphasis on classroom participation, this means that going to a seminar with a vague understanding is not enough - I have to ensure that I make at least one intelligent ( high quality/ mind-blowing ) contribution every seminar or it will affect my grades. Every seminar is a mini-exam.
The differences in the way Universities conduct lessons has caused me and my friends to come up with this joke...
NUS students can think.
NTU students can do.
SMU students can... talk.
( For political correctness sake, I can't complete this joke. A philosopher friend added a fourth line which made the joke highly elitist. )
In my past life as an Engineering undergrad, the joke was as follow:
Electrical engineers design the circuits.
Mechanical engineers design the casing.
Civil engineers carry it to the site.
Anyway I digress, I was so caught up, I could'nt blog for a while.
Ok, onto my main topic.
There exist a problem with the delay of gratification.
I call this the "What if you die?" problem.
I started re-examining the problem after a gruesome week in Law School. My life schedule is like clockwork, I wake up at 7am, crunched cases and read textbooks for the upcoming week, then attend school. After that, I spend about 2 hours with my daughter, swim and then I go home to do even more mugging.
This is also an issue faced by many investors. If all you do is keep saving, when would you actually enjoy the fruits of your labor? If you are dividends investor, the answer is obvious - you enjoy spending your dividend income so you are not completely delaying gratification if you buy stuff or travel with dividend income.
But that's not really a comfortable answer for me because I reinvest all excess dividends and spend only what is necessary to upkeep my family and living expenses. Spending my savings is my wife and daughter's problem long after I am gone.
Yes, I do get a kick when I get to study cases involving some of my investments or current affairs. My motivation is knowledge beyond what other engineer-investors have. Nothing feels better than when I read about a landlord who takes his tenant to court. These are issues which can potentially affect me. At least now I know how the local courts view such cases.
So why does a financially independent guy subject himself to an almost 15 hour-day just for the sake of knowledge and another roll of a die to have significant career ?
Now I have a possible answer.
When an investor farms his assets into a dividend yielding portfolio, he might not feel that cashing out to buy something is the reward. The reward is the security and confidence of having an asset which generates income for you.
A start-up founder enjoys building his company beyond the need for a secure income. If he cashes out, he will continue to support or build more companies. This is not delay of gratification. This is gratification.
The only way to delay gratification indefinitely is to enjoy it and view the act itself as an act of gratification.
There are interesting applications of this insight.
When you do something something unexpectedly heroic, like plunge into a risky business venture or engage in a new relationship or take on a new direction in your career, you will inevitably experience some pain. What if there is a way to reframe this as a pleasurable thing?
Anyway, that's all I have for the reader today.
Hope that I can do an update again over the weekend.
I'm almost with my first week of school in SMU's Doctor of Jurisprudence or JD program.
This is, by far, the hardest course I've ever taken in my life considering that I have done NUS engineering school, NUS's Masters in Applied Finance and passed all three CFA exams.
Prior to the start of the semester, we would have already completed reading about 30 cases, done two online quizzes, and even attempted to tackle a few problems. SMU places a large emphasis on classroom participation, this means that going to a seminar with a vague understanding is not enough - I have to ensure that I make at least one intelligent ( high quality/ mind-blowing ) contribution every seminar or it will affect my grades. Every seminar is a mini-exam.
The differences in the way Universities conduct lessons has caused me and my friends to come up with this joke...
NUS students can think.
NTU students can do.
SMU students can... talk.
( For political correctness sake, I can't complete this joke. A philosopher friend added a fourth line which made the joke highly elitist. )
In my past life as an Engineering undergrad, the joke was as follow:
Electrical engineers design the circuits.
Mechanical engineers design the casing.
Civil engineers carry it to the site.
Anyway I digress, I was so caught up, I could'nt blog for a while.
Ok, onto my main topic.
There exist a problem with the delay of gratification.
I call this the "What if you die?" problem.
I started re-examining the problem after a gruesome week in Law School. My life schedule is like clockwork, I wake up at 7am, crunched cases and read textbooks for the upcoming week, then attend school. After that, I spend about 2 hours with my daughter, swim and then I go home to do even more mugging.
This is also an issue faced by many investors. If all you do is keep saving, when would you actually enjoy the fruits of your labor? If you are dividends investor, the answer is obvious - you enjoy spending your dividend income so you are not completely delaying gratification if you buy stuff or travel with dividend income.
But that's not really a comfortable answer for me because I reinvest all excess dividends and spend only what is necessary to upkeep my family and living expenses. Spending my savings is my wife and daughter's problem long after I am gone.
Yes, I do get a kick when I get to study cases involving some of my investments or current affairs. My motivation is knowledge beyond what other engineer-investors have. Nothing feels better than when I read about a landlord who takes his tenant to court. These are issues which can potentially affect me. At least now I know how the local courts view such cases.
So why does a financially independent guy subject himself to an almost 15 hour-day just for the sake of knowledge and another roll of a die to have significant career ?
Now I have a possible answer.
When an investor farms his assets into a dividend yielding portfolio, he might not feel that cashing out to buy something is the reward. The reward is the security and confidence of having an asset which generates income for you.
A start-up founder enjoys building his company beyond the need for a secure income. If he cashes out, he will continue to support or build more companies. This is not delay of gratification. This is gratification.
The only way to delay gratification indefinitely is to enjoy it and view the act itself as an act of gratification.
There are interesting applications of this insight.
When you do something something unexpectedly heroic, like plunge into a risky business venture or engage in a new relationship or take on a new direction in your career, you will inevitably experience some pain. What if there is a way to reframe this as a pleasurable thing?
Anyway, that's all I have for the reader today.
Hope that I can do an update again over the weekend.
Friday, August 15, 2014
Is there a marriage strike going on right now ?
As I'm swamped with legal cases to process, I can't really do an in-depth analysis of this question. What we do know is that marriage rates have gone down quite drastically this year so it's time to ask ourselves this question :
Is there a marriage strike going on right now ?
Based on my cursory knowledge, I don't think women are responsible for this sudden dip. Marriages in Singapore are largely stable and with domestic help, Singapore is one of the best places in the world to raise kids. Could it be because women are performing better at work and have more financial autonomy ? I think not likely, as even if local men do not meet the expectations of women, foreign men do.
I am inclined to think that the problem lies with us men. More and more Singaporean men are not meeting women's expectations in pay and educational standards but suppose we take that out of the equation, I think we're entering this golden age where we guys can replicate an aspect of a good marriage without actually getting into ROM. Sex with prostitutes is legal here, and entertainment is one Steam download away from being fulfilled. The government has now given up and allows singles to obtain a BTO flat.
Effectively, we need to look at the problem of marriage rates differently from the past. In the past men and women want to get married, that was the only way to get sex and entertainment beyond TV. These days, singles are essentially married to themselves. Policy needs to give them reasons to divorce themselves and marry someone nice who comes by.
Singles give up autonomy when they go into ROM.
Sadly, I don't have a policy solution to the problem of marriage rates. Married couples have enough benefits from the tax-payer, it's the singles who have plenty of entertainment and no longer need marriage in their lives. One drastic possibility would be to reduce the work-week so that singles may get bored and marry out of boredom. ( Hypothetical, because the dudes can just play more computer games and spend more time at Geylang )
So thinking about this issue has largely been unproductive without a major breakthrough.
But I did achieve one single insight.
We married folks have a very irritating tendency to work this way : When we see two people who might have similar flaws, we automatically think that potentially they might be soul-mates and so we try to introduce them to each other. The logic is that the pairing of the lowest denominator will take place once all options have been exhausted.
This almost never works.
Consider the decision tree from party A's perspective. Even though I have flaw, I am essentially giving up this fantastic relationship I have with myself to hook up with this other flawed individual.
In conclusion, A will stick with himself or herself, thank you.
Is there a marriage strike going on right now ?
Based on my cursory knowledge, I don't think women are responsible for this sudden dip. Marriages in Singapore are largely stable and with domestic help, Singapore is one of the best places in the world to raise kids. Could it be because women are performing better at work and have more financial autonomy ? I think not likely, as even if local men do not meet the expectations of women, foreign men do.
I am inclined to think that the problem lies with us men. More and more Singaporean men are not meeting women's expectations in pay and educational standards but suppose we take that out of the equation, I think we're entering this golden age where we guys can replicate an aspect of a good marriage without actually getting into ROM. Sex with prostitutes is legal here, and entertainment is one Steam download away from being fulfilled. The government has now given up and allows singles to obtain a BTO flat.
Effectively, we need to look at the problem of marriage rates differently from the past. In the past men and women want to get married, that was the only way to get sex and entertainment beyond TV. These days, singles are essentially married to themselves. Policy needs to give them reasons to divorce themselves and marry someone nice who comes by.
Singles give up autonomy when they go into ROM.
Sadly, I don't have a policy solution to the problem of marriage rates. Married couples have enough benefits from the tax-payer, it's the singles who have plenty of entertainment and no longer need marriage in their lives. One drastic possibility would be to reduce the work-week so that singles may get bored and marry out of boredom. ( Hypothetical, because the dudes can just play more computer games and spend more time at Geylang )
So thinking about this issue has largely been unproductive without a major breakthrough.
But I did achieve one single insight.
We married folks have a very irritating tendency to work this way : When we see two people who might have similar flaws, we automatically think that potentially they might be soul-mates and so we try to introduce them to each other. The logic is that the pairing of the lowest denominator will take place once all options have been exhausted.
This almost never works.
Consider the decision tree from party A's perspective. Even though I have flaw, I am essentially giving up this fantastic relationship I have with myself to hook up with this other flawed individual.
In conclusion, A will stick with himself or herself, thank you.
Monday, August 11, 2014
The Problem of Envy.
A key concept which I should have explored more in my books is the Problem of Envy.
A friend recently shared a personal problem with me. He has a very successful ex-classmate who works in Oil & Gas who enjoys rubbing his success in my friend's face. I think this is a common problem in Singapore: It is not our absolute wealth that determines our life satisfaction, but our wealth relative to the folks around us.
As our education system does not really teach us Philosophy, we fall prey to the notion that being Singaporean is, in essence, waging a psychic war against each other by displaying our ownership of increasingly expensive material goods. I bet the Oil & Gas dude loves to show off his large car, branded watches and mistresses to my poor engineer friend.
Before I come out with a solution, I want to avoid talking about two common answers which most readers can come up with :
a) Get yourself new friends who are not assholes.
Easy solution, right ? Just drop the jerk and asshole from your life ! I think that's not a great solution because we will always need to deal with folks richer and more successful than we do. The other reason is that some jerks and asshole may be useful as we keep them pidgeon-holed in our weak network links. Sometimes, listening to him brag for an hour and you might come ahead with a better job offer.
b) Change your mindset about envy.
Another bad answer. Mindset change is actually really hard if you do not really have the means to think about your personal identity and how it fits into your actual behavior. This may even require years of therapy. Asking for a mindset change is also not too different from being an expert who is abdicating control over the situation.
Instead I will present the two following solutions:
a) Diversify your achievements
The first possible defense is diversify your achievements. Benefits of this approach is two-fold.
This comes from the notion that brain is a machine which secretes dopamine which is some kind of reward when you achieve something which is personally meaningful to you. By taking on more hobbies and making progress with them, your brain fires off dopamine more frequently and give you more personal happiness.
Furthermore, as you have developed more varied interests and hobbies, you never have to kowtow to your more successful friend because he will never be able to do well in all the things which you have focused on.
My friend was an editor in Chinese magazine during his University days. He can read books on Chinese poetry. Perhaps he can spend more time to read up on Chinese culture and make himself an expert in it and occasionally write letters to the Chinese press. An expert in Chinese poems is infinitely more fun than an Oil and Gas executive who fucks PRCs in Geylang.
I doubt the asshole is going to challenge his authority on that.
b) Focus on experiential goods instead of material ones.
The second solution follows the psychology discovery that experiential goods are better than material goods, but it has a subtle element which can be used as a countermeasure against the Great War of Envy.
Yes, experiential goods provide memories which can be summoned to make you feel good. But the secret power of experiential goods is that they take time. You can build a portfolio of experiences which can be hard to replicate. Eg. Not everyone can see the Aurora Borealis in Finland, I know friends who failed to do that although failing is itself a cool experience in my book. My law school is a 3 year experiential good which i bet Mr. Oil and Gas would not want to pay the opportunity cost to attend.
My second advice is that my friend needs to catalog a set of interesting experiences to shift topic whenever Mr. Oil and Gas shows off his latest Rolex Watch, share some of his personal experience which are UNIQUE to himself. Some experiences like coaching his kid to win Weiqi class may be a unique experience that only a successful dad can have.
c) Focus on ideas instead of things.
My final advice is much harder to follow and may even require a mindset change.
I think that the folks who focus on branded good consumption are, in general terms, academically and intellectually the bottom feeders in the food chain. It takes a special idiot to have a hang-up on the brand of his wallet when it's actually the contents of the wallet which counts.
I normally when people talk about stuff. I tune in only when people talk about ideas.
People who focus on ideas, generally speaking, have less time to compare against each other. Ideas cannot be measured ( Unless you IPO ). Their merits have to be assessed by critical thought. Rich people don't have a monopoly on great ideas.
My third advice is to, of course, to read voraciously. But some amount of verbal aikido can be employed when engaging Mr. Oil and Gas. My friend needs to keep changing the battlefield from a pissing contest to a war of ideas. I would pretend to flatter his his friend and then ask him what is his definition of success and then slowly deconstruct his definition to see if he is truly successful by his own definition.
This is something Socrates would agree on.
I think the Problem of Envy is not likely to get any better in Singapore. We have more millionaires minted here but people don't really make an effort to think critically about living in this society.
Hope that this will be useful the next time you meet your more wealthy Nemesis for a pissing competition.
A friend recently shared a personal problem with me. He has a very successful ex-classmate who works in Oil & Gas who enjoys rubbing his success in my friend's face. I think this is a common problem in Singapore: It is not our absolute wealth that determines our life satisfaction, but our wealth relative to the folks around us.
As our education system does not really teach us Philosophy, we fall prey to the notion that being Singaporean is, in essence, waging a psychic war against each other by displaying our ownership of increasingly expensive material goods. I bet the Oil & Gas dude loves to show off his large car, branded watches and mistresses to my poor engineer friend.
Before I come out with a solution, I want to avoid talking about two common answers which most readers can come up with :
a) Get yourself new friends who are not assholes.
Easy solution, right ? Just drop the jerk and asshole from your life ! I think that's not a great solution because we will always need to deal with folks richer and more successful than we do. The other reason is that some jerks and asshole may be useful as we keep them pidgeon-holed in our weak network links. Sometimes, listening to him brag for an hour and you might come ahead with a better job offer.
b) Change your mindset about envy.
Another bad answer. Mindset change is actually really hard if you do not really have the means to think about your personal identity and how it fits into your actual behavior. This may even require years of therapy. Asking for a mindset change is also not too different from being an expert who is abdicating control over the situation.
Instead I will present the two following solutions:
a) Diversify your achievements
The first possible defense is diversify your achievements. Benefits of this approach is two-fold.
This comes from the notion that brain is a machine which secretes dopamine which is some kind of reward when you achieve something which is personally meaningful to you. By taking on more hobbies and making progress with them, your brain fires off dopamine more frequently and give you more personal happiness.
Furthermore, as you have developed more varied interests and hobbies, you never have to kowtow to your more successful friend because he will never be able to do well in all the things which you have focused on.
My friend was an editor in Chinese magazine during his University days. He can read books on Chinese poetry. Perhaps he can spend more time to read up on Chinese culture and make himself an expert in it and occasionally write letters to the Chinese press. An expert in Chinese poems is infinitely more fun than an Oil and Gas executive who fucks PRCs in Geylang.
I doubt the asshole is going to challenge his authority on that.
b) Focus on experiential goods instead of material ones.
The second solution follows the psychology discovery that experiential goods are better than material goods, but it has a subtle element which can be used as a countermeasure against the Great War of Envy.
Yes, experiential goods provide memories which can be summoned to make you feel good. But the secret power of experiential goods is that they take time. You can build a portfolio of experiences which can be hard to replicate. Eg. Not everyone can see the Aurora Borealis in Finland, I know friends who failed to do that although failing is itself a cool experience in my book. My law school is a 3 year experiential good which i bet Mr. Oil and Gas would not want to pay the opportunity cost to attend.
My second advice is that my friend needs to catalog a set of interesting experiences to shift topic whenever Mr. Oil and Gas shows off his latest Rolex Watch, share some of his personal experience which are UNIQUE to himself. Some experiences like coaching his kid to win Weiqi class may be a unique experience that only a successful dad can have.
c) Focus on ideas instead of things.
My final advice is much harder to follow and may even require a mindset change.
I think that the folks who focus on branded good consumption are, in general terms, academically and intellectually the bottom feeders in the food chain. It takes a special idiot to have a hang-up on the brand of his wallet when it's actually the contents of the wallet which counts.
I normally when people talk about stuff. I tune in only when people talk about ideas.
People who focus on ideas, generally speaking, have less time to compare against each other. Ideas cannot be measured ( Unless you IPO ). Their merits have to be assessed by critical thought. Rich people don't have a monopoly on great ideas.
My third advice is to, of course, to read voraciously. But some amount of verbal aikido can be employed when engaging Mr. Oil and Gas. My friend needs to keep changing the battlefield from a pissing contest to a war of ideas. I would pretend to flatter his his friend and then ask him what is his definition of success and then slowly deconstruct his definition to see if he is truly successful by his own definition.
This is something Socrates would agree on.
I think the Problem of Envy is not likely to get any better in Singapore. We have more millionaires minted here but people don't really make an effort to think critically about living in this society.
Hope that this will be useful the next time you meet your more wealthy Nemesis for a pissing competition.
Friday, August 08, 2014
Decision making in postgraduate education.
Unlike the past, when a degree is required to get ahead, a lot of professionals are faced with the question on what kind of post-graduate qualifications to obtain.
As I've gone through this process twice, here's my two cents worth based on what I've gone through :
i) CFA or MBA ?
An MBA is especially attractive if you have only 2 years of experience in the working world. For technical professionals, am MBA gives you the chance to make another attempt at a fresh career as a management associate if you dislike engineering or do not see yourself doing technical work.
When I was faced with a choice of CFA or MBA, it was not such a straightforward choice for me. I don't have a problem being technical for a the rest of my life - there was too little coding in my life and I wouldn't mind doing more R&D ! In fact, I hated politics, bureaucracy and processes. My real problem was that I don't really understand how money works which can be lethal because I don't see a lot of 40-something IT professionals in my workplace in those days.
The CFA program gave me a chance to really study exclusively about how capital is accumulatated. I really don't have to waste any time on marketing, organizational behaviour or operations management. All I studied was accounting, economics, statistics and various asset classes. The Masters of Applied Finance I applied for was also cheap at about $11,000 in 2001. The CFA exams were just examination fees, like all the MCSE, CGEIT and PMP exams I took.
What eventually broke the tie and made me decide on investments was the simple notion that the CFA program is hard. It had a ridiculously low pass rate and the program did not hesitate to maintain high standards when the test takers from China and India started figuring that this may change their life. I saw the rigorous standards as some sort of a moat. The fact that I passed will stand out even if I never obtained the charter.
Was it a good decision on hindsight ? You be the judge.
I never jumped to banking and finance. My salary stagnated the longer I stayed in IT outsourcing but I just kept getting less sleep everyday. I just did more and more IT work as an operations manager, compliance, audit and finally as a project manager in the government which make me swear off IT for good.
The knowledge, however, came in useful in a time when there isn't any books on investing in local stocks. My income flow from my investments eventually exceeded my earned income which bought me enough time for a more drastic career re-roll.
ii) EMBA or JD ?
The second time round things were a lot easier. if I were to take the EMBA, half of my fees would have been wasted as I would have already done most of the quantitative modules. The only thing I liked about MBA programs like the one at Harvard's is their case approach which was basically real-world problem solving. I used to devour books on the Case method as I loved the way MBAs dissect a very ephemeral problem and come out with a reasonable plan of action.
Eventually I chose the JD program because it was something which I was not naturally inclined to excel in. Every module was sufficiently alien to me that I would probably learn a great deal even if I were to scrape through every semester. The fact that it's possible to get more philosophical during class discussions was also something I look forward to when analyzing cases.
As for how good this gig will be for my career, only time will tell. There is a very strong and firm moat surrounding legal work in Singapore - this is a public knowledge. But I must be able to convince someone to offer a training contract to a 42 year old.
The biggest opportunity cost is that I would not have been able to network had I signed up for an EMBA program, that might actually be more relevant and would build on my 14 years of experience in IT.
In summary, these are the criteria which I think would be relevant to anyone choosing a postgraduate qualification :
a) Program that you qualify for must be hard and as exclusive as possible.
The program must exclude as many people as reasonably possible ( But still take you in ). The CFA excludes by having ridiculously low pass rate. The JD program admits only about 40 a year and sets you back $80k once you factor in the textbooks.
This goes back to the notion that we invest based on economic moats. A postgraduate qualification is an expensive investment.
b) Program must teach you something completely new.
You need to benefit from the program and not just develop incremental skills. If I just want to pick up Python or Big Data , I have Coursera and Udacity to make it happen for me.
c) The Program must be useful and respected in society.
I chose Engineering over Science, Finance over Economics, Law over Humanities. Yeah, it's a pattern.
In a difference society, I may choose otherwise We still live in paper and money conscious Singapore. Education in local institutions is expensive, if you want to part with some dough, you need to convince yourself that this is going to give you new skills and capabilities that companies will want to pay for.
c) The Program must change you in a fundamental way.
This is perhaps the most important. Take away all the skills and knowledge, each discipline confers a certain attitude which should change you for the better.
Engineering made me very comfortable with numbers and grounded me as a concrete thinker. When I am on the job, I try to cut through the bullshit and figure out what needs to be done to get things to work.
Finance gave me the tools to appraise the value in all things. When folks with me dubious numbers, I know the fundamental limits of all asset classes. I know that no one will provide you a free lunch and there's something in it for everyone. There's a little game theory in that.
I have yet to figure how Law will change me, I suspect that I will learn to respect the context a lot more after my course and there are no straightforward answers to issues concerning fellow human beings. I hope to become a lot more strategic and big picture in all my dealings. Hopefully, getting into an argument with me will be a lot nastier ( Oh yes, I will ensure that with my choice of CCA ! ).
At the end of the day, Financial Independence should be meaningful.
If my passive income does not allow me to make a couple of bad, foolish or sub-optimal moves just for the heck of it, then it would not be worthwhile. Crazier folks have quit the workforce on a portfolio of a smaller size.
As I've gone through this process twice, here's my two cents worth based on what I've gone through :
i) CFA or MBA ?
An MBA is especially attractive if you have only 2 years of experience in the working world. For technical professionals, am MBA gives you the chance to make another attempt at a fresh career as a management associate if you dislike engineering or do not see yourself doing technical work.
When I was faced with a choice of CFA or MBA, it was not such a straightforward choice for me. I don't have a problem being technical for a the rest of my life - there was too little coding in my life and I wouldn't mind doing more R&D ! In fact, I hated politics, bureaucracy and processes. My real problem was that I don't really understand how money works which can be lethal because I don't see a lot of 40-something IT professionals in my workplace in those days.
The CFA program gave me a chance to really study exclusively about how capital is accumulatated. I really don't have to waste any time on marketing, organizational behaviour or operations management. All I studied was accounting, economics, statistics and various asset classes. The Masters of Applied Finance I applied for was also cheap at about $11,000 in 2001. The CFA exams were just examination fees, like all the MCSE, CGEIT and PMP exams I took.
What eventually broke the tie and made me decide on investments was the simple notion that the CFA program is hard. It had a ridiculously low pass rate and the program did not hesitate to maintain high standards when the test takers from China and India started figuring that this may change their life. I saw the rigorous standards as some sort of a moat. The fact that I passed will stand out even if I never obtained the charter.
Was it a good decision on hindsight ? You be the judge.
I never jumped to banking and finance. My salary stagnated the longer I stayed in IT outsourcing but I just kept getting less sleep everyday. I just did more and more IT work as an operations manager, compliance, audit and finally as a project manager in the government which make me swear off IT for good.
The knowledge, however, came in useful in a time when there isn't any books on investing in local stocks. My income flow from my investments eventually exceeded my earned income which bought me enough time for a more drastic career re-roll.
ii) EMBA or JD ?
The second time round things were a lot easier. if I were to take the EMBA, half of my fees would have been wasted as I would have already done most of the quantitative modules. The only thing I liked about MBA programs like the one at Harvard's is their case approach which was basically real-world problem solving. I used to devour books on the Case method as I loved the way MBAs dissect a very ephemeral problem and come out with a reasonable plan of action.
Eventually I chose the JD program because it was something which I was not naturally inclined to excel in. Every module was sufficiently alien to me that I would probably learn a great deal even if I were to scrape through every semester. The fact that it's possible to get more philosophical during class discussions was also something I look forward to when analyzing cases.
As for how good this gig will be for my career, only time will tell. There is a very strong and firm moat surrounding legal work in Singapore - this is a public knowledge. But I must be able to convince someone to offer a training contract to a 42 year old.
The biggest opportunity cost is that I would not have been able to network had I signed up for an EMBA program, that might actually be more relevant and would build on my 14 years of experience in IT.
In summary, these are the criteria which I think would be relevant to anyone choosing a postgraduate qualification :
a) Program that you qualify for must be hard and as exclusive as possible.
The program must exclude as many people as reasonably possible ( But still take you in ). The CFA excludes by having ridiculously low pass rate. The JD program admits only about 40 a year and sets you back $80k once you factor in the textbooks.
This goes back to the notion that we invest based on economic moats. A postgraduate qualification is an expensive investment.
b) Program must teach you something completely new.
You need to benefit from the program and not just develop incremental skills. If I just want to pick up Python or Big Data , I have Coursera and Udacity to make it happen for me.
c) The Program must be useful and respected in society.
I chose Engineering over Science, Finance over Economics, Law over Humanities. Yeah, it's a pattern.
In a difference society, I may choose otherwise We still live in paper and money conscious Singapore. Education in local institutions is expensive, if you want to part with some dough, you need to convince yourself that this is going to give you new skills and capabilities that companies will want to pay for.
c) The Program must change you in a fundamental way.
This is perhaps the most important. Take away all the skills and knowledge, each discipline confers a certain attitude which should change you for the better.
Engineering made me very comfortable with numbers and grounded me as a concrete thinker. When I am on the job, I try to cut through the bullshit and figure out what needs to be done to get things to work.
Finance gave me the tools to appraise the value in all things. When folks with me dubious numbers, I know the fundamental limits of all asset classes. I know that no one will provide you a free lunch and there's something in it for everyone. There's a little game theory in that.
I have yet to figure how Law will change me, I suspect that I will learn to respect the context a lot more after my course and there are no straightforward answers to issues concerning fellow human beings. I hope to become a lot more strategic and big picture in all my dealings. Hopefully, getting into an argument with me will be a lot nastier ( Oh yes, I will ensure that with my choice of CCA ! ).
At the end of the day, Financial Independence should be meaningful.
If my passive income does not allow me to make a couple of bad, foolish or sub-optimal moves just for the heck of it, then it would not be worthwhile. Crazier folks have quit the workforce on a portfolio of a smaller size.
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