Tuesday, January 31, 2017

Channel 8 Rant : Why be a Good man when you can be a Great man !

A Happy New Year to all the readers of this blog.

I've been silent this new year prior to writing this article because I don't really have any mind-blowing content today having initially wanted to talk about elitism, hubris and exclusivity of law schools but that's only useful for a small segment of my readership and not really consistent with the festive mood this week.

And then, a couple of minutes ago, a good friend sent me this link to this awesome rant about being a Good Man in Singapore.

You can follow it here.

I must say that Ch 8 programming will be quite good if it can channel the frustrations of the Singapore heartlander. So let's hope that Mediacorp keeps up the good work !

This link has Ch 8 actor Jeremy Chan talking about what it takes to be a good man in Singapore. Upon reflection, Jeremy Chan comes to the conclusion that life is too short and meaningless to be a good man in Singapore.

I think Jeremy Chan's character is, by design,  too smart for his own good.

I'm going to offer an alternative for readers and propose the path of the "Great Man". Someone who can lead a superior life compared a Good man. If Friedrich Nietzche has his Ubermensch, at least readers of this blog has the idea of a Great Man which is derived from Jeremy Chan's idea of a Good man.

a) A Great Man makes $3,300 as a graduate and that's not counting overtime.

In the video clip, Jeremy claims that a good degree produces a salary of $3,000. The actual number is around $3,300 based on actual statistics of local graduates, this $300 difference can be critical when we look at the savings component later on.

b) A Great man minimises his non-discretionary expenses because they do not define him as a person.

The video does not accurately portray the spending of a great man who actively optimises his expenses. While it is correct that Great man eats at hawker centres or food courts and spends about $6-$7 a meal, transport can be capped at $120 using a transport concession pass for adults so that's at least another $180 of savings every month.

c) A Great Man saves his increments, bonuses and overtime.

Jeremy Chan's character then misses two important components of salary of a man in his 20s and 30s. Firstly, that some graduates do get overtime pay (more if some young worker actually gives tuition on weekends ). Secondly, a graduate gets bonuses. And thirdly, a graduate worth his salt can get 8-12% increments for at least the first 5 years of his working life.

With these three components, a Great man can learn a thing or two from the Budget babe who can achieve $30,000 savings perhaps during the second year of work.

d) A Great Man can invest his savings creating wealth which snow balls.

I keep harping about $300,000 portfolio yielding 8%, but suppose this Great Man invests it in equities, he can expect about 8.5% on average over the long term, this means that the following year, his investments can further defray $2550 of his expenses. If he spends $1,500 per month, this will defray close to 15% of his annual expenses the following year, which let's him save even more money after that.

e) A Great Man constantly upgrades himself.

Between doing overtime and giving tuition, the great man will eventually realise that his skills are really fading fast even as he is gainfully employed sometime in Year 5. There will be opportunities to find jobs which pay a huge premium for someone with the right skills. A Great Man will then making tactical moves to obtain these skills which will be a lot cheaper to achieve these days than during my time. These days, the government gives $500 Skills Future credits and Coursera and Udacity has drastically lowered the bar for anyone wishing to obtain new and marketable tech skills.

For me during the bad old days, there were the CFA and MSCE IT certifications but these days it can be the Data Science Specialisation from John Hopkins or the highly marketable INSEAD MBA.

f) The Great Man pushes family formation and dating all the way to the back of the queue.

Between managing a career, moonlighting, and upgrading skills constantly, something has to give because the Great Man is not a Superman.

What the great man gives up is early family formation and dating.

The optimal approach to dating has always been the solution to the secretary problem developed by computer scientists. If the Great Man gives himself 15 years to settle down starting from age 25, he does not have to commit seriously to a relationship until he is 31 (1/e or 37% of his 15 years duration).

g) What does the Great Man do to entertain himself ?

Does all work and no play makes the Great Man a dull boy ?

Here's the politically incorrect nub of the issue - for fun, the Great Man does exactly the same thing as any other men. When social scientists studied unemployed men without degree qualifications, 18-30 hours of computer gaming a week leads to a life of unusually high personal satisfaction. There is nothing preventing a Great Man from doing what simply works to keep himself entertained.

Just resist the temptation of buying virtual goods.

The only difference is that a Great Man should hang out with other Great men and never game while upgrading priorities have yet been met.

h) So what is not guaranteed when you do become a Great Man ?

Carrie Wong is not a guaranteed reward for a Great Man.

You might need to become a Ridiculously Unreasonable and Successful Man for that.

Explaining how to become one is the job for a different kind of blogger.

Wednesday, January 25, 2017

Modern trends in self-help and personal improvement

I started reading self-help books sometime during my JC years, quite a while before Robert Kiyosaki incited me to really take possession of my personal financial destiny.

The self-help fare in those days are divided along the lines of the personality ethic books by Dale Carnegie and the character ethic books championed by Stephen Covey. Along the way, Anthony Robbins became a huge motivational superstar and Neuro Linguistics Programming start to take off. I, too, was also swept up by the trend of going really far to read the books written by NLP founder Richard Bandler and John Grinder.

As the effort to wind-down on my summary on Tools for Titans, it might be useful to share some trends I noticed looking at some of the more contemporary trends in self help.

a) Buddha and Confucius - Rise of Eastern Philosophy

Maybe it's because of the economic rise of China, the West has become enamoured with all things Oriental. A module on Confucius has become the third most popular course in Harvard university. There is also this very strange but pervasive trend of successful folks from Silicon Valley who practice some form of meditation reported in Tools for Titans.

I bet you can expect a lot of self-help to channel Buddhism moving forward with one or two works on the fringe which talks about Legalism or Mohism in the future.

b) Return of Stoicism - Resilience becoming a panacea to everyone's problems

You can't emerge from Kinokuniya without seeing quite a few books on Grit or Resilience. Another observation is the rise of Stoic philosophy, which asserts  that you can control how to respond to any stimulus. There is a branch of psychology which grew from this philosophy as well (Cognitive Behavioural Therapy).

While I don't disagree with the studies, I am curious as to how much should a person "tarhan" before throwing in the towel. Do you really want to stick to reporting to a bad manager when there are better opportunities somewhere else ? Where do you draw the line ?

The problem with resilience is that too little is known of gritty people who have failed in their lives. Do overly resilient end up sticking so hard to an impossible mission that they destroy their lives in the process ? This is an important question to ask when facing raving fans of the Resilience movement.

c) Carol Dweck's Growth Mindset versus Fixed Mindset

If you have not become sick of Carol Dweck's idea of growth mindset trumping over the fixed mindset, expect this idea to become even more dominant when AI starts destroying white collar jobs and people find that they need to pick up new skills to remain employable.

The basic idea is that our brains are malleable. If we put in the time and effort to do something well, we can grow to become better at it over time. It explains why ordinary students who believe that they can do better can trump gifted students who believe that their talents are fixed.

I expect life coaches to be channeling a variant of this approach to get clients to break out of their comfort zones.

d) Scott Adams - Systems as a superior alternative to goals

The emergence of systems as something superior to goals is a result of the tedium of seeing people proclaim their SMART goals without doing anything substantial to achieve it.

A goal is an outcome but a system has to be acted upon.

Gamification is a system. Exercising in a Gym is a system. Setting aside money to invest for dividends is also a system.

I can imagine many self-help books in the future proposing many systems to assist in areas like personal finance or dieting.

See if you can identify a major trend

My list is definitely not collectively exhaustive. If you can find another general direction within the field of self-improvement, do share with me on this blog.

Monday, January 23, 2017

Tools for Titans #45 : The Last One !

All good things must come to an end.

This is the last segment on this blog on Tools for Titans. I am only going to do the wealthy section of the book. Starting tomorrow, my priorities are to complete the "Wise" section at my normal pace which means that I would be done with the book over the next few days.

BJ Novak is an actor, writer, director and executive producer of the hit comedy The Office.

a) Unlike time, money can still be regenerated.

Regenerating money is quite easy, just build a big portfolio, get it to grow and only consume part of what was grown. Time, when lost, cannot be recovered.

While this statement asserts that time is more important than money, the ability to regenerate money means that you have more leeway to use your time properly. This means that you can make more meaningful use of your time rather than engage in unpleasant interactions.

b) Schedule things in advance so that you can't back out.

At least when it comes to comedy (or International Moots for me), a person can suck for a really prolonged period of time.

The trick is to commit your time so that you do not give up. This reminds me of Carol Dweck's growth mindset idea that people who can accept that they can improve on something tend to do better in life compared to those with fixed mindsets.

c) No Artisanal Aspirin

One thing I noticed about many creatives is that they tend to complement their lives predictable rituals. For example, Steve Jobs always wears that black turtleneck. BJ always go for that standard coffee from Starbucks in the morning.

The idea is that predictability in some areas in your life allows the person to fully creatively engaged in others. Quite a lot has been said here but I can't seem to find any evidence that this works.

Anyway, this is the end of my personal project.

I wanted to read Tools for Titans at a much slower and daily pace that I was less used to and I forced myself to blog everyday for the past 50 days or so.

By now, a few bloggers has started on summarising other sections of the book.

Sunday, January 22, 2017

Tools for Titans #44 : The best way to predict the future is to create it.

Peter Diamandis has been named one of the World's 50 greatest leaders by Forbes Magazine. He is interested in space travel and human longevity. This is a good, solid section that is full of visionary ideas.

a) A problem is a terrible thing to waste

This simple idea exhorts us to cherish the problems that we discover at work because if this problem is novel enough, it can lead to the incorporation of a new business.

Some interesting questions I ask myself is this : Among high dividend yielding equity counters, what selection of metrics can we use to find a subset of such stocks to boost the annual performance further ?

I think we are close to having an answer for that.

b) The anally-retentive live longer

There is a hilarious sidetrack which discusses why dental flossing every day results in a much longer life to demonstrate that correlation is not causation.

It is more likely that people who floss everyday tend to be anally retentive and have adopted habits which leads to a longer life.

c) The best way to predict the future is to create it  

This was just one of Peter's maxims which are listed in the section which I really liked to adopt as mine with regards to how I see my career over the longer term as legal-tech stealthily impacts the legal sector the same way Fintech has done for banking.

Prediction is a difficult task that results in inaccuracies so why not get directly into the business to influence the change next time.

Saturday, January 21, 2017

Tool for Titans #43 :The problem with plans.

Scott Belsky is an entrepreneur, author and investor.

a) The problem with plans.

Right off the bat, Scott talks about the limitations levied when you plan your life too well.

Scott's idea is that if he plans for everything, his life will not exceed his expectations because he loses one source of creativity as he gets jammed less often. We can't really falsify this statement but productivity systems like GTD aim to assist in planning your life so well that your mind becomes more creative as you free up the time to be really imaginative.

Just who is right ?

b) Kill your darlings

It's easier to agree with this second point.

Businesses have to kill their darlings in order to grow and thrive. Sometimes, a business is fixated with an unprofitable product and this limits their ability to scale given limited resources. This is why consultants always try to trim the menu for failing restaurants to bring it back into profitability.

c) There is no pattern behind successful innovation

Great innovation comes from surprise. Entrepreneurs who adopt patterns or somebody else's playbook can create a derivative product but will not create something which changes the world.

I've always harboured grave doubts about books on turning innovation into a process. It might be better to read a technology textbook instead.

Friday, January 20, 2017

Tools for Titans #42 : Inspiration is for amateurs.

Justin Boreta is the founding member of Glitch Mob.

I have no fricking idea who this guy is. If you are a fan of his music, please share with me his better songs. Initially, I had half a mind to skip this section because it is not coherent enough to be in this book and the editor should be shot for allowing this to be included.

The only statement I will discuss today is the statement that "Inspiration is for amateurs - the rest of us just show up and get to work." The editing is so bad, I wasn't even sure whether he agreed with this statement or he didn't agree with it.

The flaw in this statement is that getting inspired was positioned to be mutually exclusive against showing up to get the work done. You often need a certain measure of both to engage in your creative pursuits.

For example, this Tools for Titan's series is quite grindy because I need to be disciplined enough to do one segment every day. But sometimes, feedback from the fans as well as the Adsense numbers give me the inspiration and motivation to carry on.

Keep it hanging... Tools for Titans on this blog will be over and done with over the next 4-5 days.

Then we will move to something more hardcore for intermediate investors.

Thursday, January 19, 2017

Tools for Titans #41 : What are their incentives ?

Mike Shinoda is one of the two vocalists of Linkin Park.

There is only one major learning from this section of the book.

When we engage with someone, the first question we should always ask ourselves is what are the incentives of the other party.

For example, how do we know that insurance agents may not have our best interests in mind ?


Insurance agents  make a commission based on how many or what kinds of products we buy from them. They are not paid a commission when we meet our financial goals or do well in the financial markets.

Insurance agents will sell you products which would give them the highest possible commissions. You see a lot of ILPs being unloaded to the hapless customer but very few term life insurance schemes. Confront them with this fact and you will find a response which demonstrates just how prepared and polished they are for questions like that which you pose.

Same goes for some of these so-called life coaches.

If life coaches are paid per session, and do not negotiate the conditions for an exit, then the incentive would be to extend the business relationship for as long as possible. Does the life coach ever benefit from resolving your personal issues permanently ?

Don't get me started on litigators....

Wednesday, January 18, 2017

Tools for Titans #40 : Reject the norms of your time.

This segment is about Neil Strauss. He is the author of the pick-up book The Game. If I were to read The Game in my 20s, Neil might have turned out to be my favourite author. Unfortunately, I learnt of his works through mutual friends who experimented with "negging" women with low self-esteem at pickup bars.

( I don't neg women with low self-esteem. My wife, however, is very good at negging men with an abnormally high self-esteem. )

I was actually rather turned off my some of the antics used in The Game. I will not say that it does not work, a lot of single men who "neg" women with a low self esteem end up getting a good time. The question is whether they can build a lasting bond.

This write-up on Neil Strauss, however, turned out to be very useful and shows him to be more than just a beta-male pick-up artist.

a) Reject the norms of your time

A billionaire claims that the reason why they are rich is because they reject the norms of their time. This is probably true.

But you can also reject norms by committing sexual assault. Consequently, you can find a lot of 'iconoclasts' in prison.

b) Three ways of editing your works 

This is actually a good tip to improve fiction writing. First, edit the work to please yourself. Second, edit your work to please your fans. Finally, edit your work to please your critics.

I really like this piece of advice as I may still have a book waiting for publication in a few years or so.

c) Defeat writer's block by lowballing targets

Neil's writing advice should to not be ignored as he is a perpetual best-seller.

His advice against writer's block is simply create two crappy pages of work every day. If George R R Martin followed Neil's advice, Winds of Winter would have been out years ago.

This blog is my way of writing 2 crappy pages a day. I've been churning out pages every day thanks to Tools for Titans.

Tuesday, January 17, 2017

Tools for Titans #39 : Gut Investing.

At least according to Tim Ferriss, Kevin Rose is the best stock picker in the start-up world. Compared to the other sections of the book, this section ranks as one of the more important ones for the investing public.

When it comes to start-up investing, most value investors who need to look at accounting statements would be quickly rendered impotent because may startups are hardly profitable businesses. A similar phenomenon occurs when dealing with cypto-currencies so most investors rely on technical indicators to time their purchases.

In such an absence of information, Kevin Rose invests using his gut - he invests by assessing the business idea emotionally.

Kevin looks at the feature of each start-up product and determines how much emotional impact it would have for the customer. He also considers the possibility of a future feature when making such an assessment. In the Twitter example as demonstrated in the book, the main points of consideration were quick public sharing, following and syndication of content. All three features which were deemed to appeal emotionally to the customer.

Within the Twitter example lies the weakness of investing based on your gut. Twitter is not exactly doing particularly well in the market right now so there are limits to investing this way according to emotion. But I'm pretty sure Kevin got a nice sexy exit when Twitter IPOed a while ago.

Tim also credits Kevin Rose with making a prediction on augmented reality much earlier than the breakout success of Pokemon Go.

Unless a person is actually an accredited investor, I do not advise investing by gut feeling. Start-up founders spend inordinate amounts of time honing an elevator pitch which would make anything emotionally attractive. Furthermore, businesses exists to make money, so some attention should at least be given to future profitability. There are plenty of solid cash generating businesses which are boring and will not excite customers in any way.

One final point is that I don't even consider Kevin Rose's approach as being unique in any particular way. Peter Lynch has always advocated an investment idea based on his wife's shopping habits in his book One Up on Wallstreet. I am pretty sure that his wife's fancy is not the sole basis of the considerations he makes when investing in a stock counter.

I think Tim Ferriss is just fixated with one aspect of decision making by Kevin Rose.

I'm sure a deeper discussion would yield a methodology with more moving parts.


Monday, January 16, 2017

Personal finances when transitioning from single-hood to being married.

Ok, today's article is to simply tie up a loose end from the talk. We failed to address the question directly from a question in the audience who asked us how our personal finance changed when we transitioned from single-hood to marriage.

Theoretical answer

I will first share a theoretical answer because it is more likely to be experienced by a reader. In the presentation I shared a table which showed that households becoming more economically efficient as the number of family members increase.

If you transition from a 4 person household to a 2 person household of a married couple, you are likely going to experience a 33% increase  in expenses. However, if you are already living alone as a single person, you may experience a reduction of 20% as you find more efficient ways to spend your money as a couple.

Personal answer

I was borderline financially independent when I got married, getting around $2k+ dividends a month but spending about $1200-$1500 as a single man. Me and my wife stayed with my parents for quite a number of years and we both worked then.

The only major change was that every month, I channelled an extra $1500 into a joint account to build a dividends portfolio for my family.

The first major change to my personal finances was the time we bought a weekend car for $28,000 which meant that I had to pay road taxes every year.

When my daughter was born, it was financially a non-event as accumulated dividends paid for almost everything and everything else was settled by the matching I made to the Child Development Account.

It was good to farm 100% of my earned income into the stock market and pay for everything from dividends payouts.

The only stressful event was getting my first mortgage because I was already transitioning out of a job by then and now I have property taxes and conservancy fees. My CPF can still last me about 3-4 years, but setting aside the dividends equivalent to the mortgage value is stressful even although I am currently investing that amount too to push my dividends up even further.


Sunday, January 15, 2017

Tools for Titans #38 : The value of "I Don't Understand"

Luis Von Ahn is a computer science professor and the CEO of Duolingo, one of the more efficient ways to pick up a new language.

His section has two key ideas :

a) The value of "I don't understand"

Luis had a Phd advisor who kept insisting that he did not understand what Luis was trying to say when he was developing the CAPTCHA system. Eventually, it was revealed that his advisor was simply employing a tactic to get Luis to think deeper about the problem he was facing with.

Blogger Scott Young is an advocate for a learning approach known as the Feynman Technique which basically forces you to explain concepts that you learn in plain English. If you find that your ideas are expressed in jargon, it is possible that you really do not understand the material yourself.

The kay to mastery to is to be be able to explain something to an untrained lay-person. This is something which I should aspire to on this blog although we're still quite far from that ideal.

b) Build startups outside Silicon Valley

The second idea is that Luis prefers to build startups outside Silicon Valley. By sticking to areas like Pittsburgh, the companies which Luis run tend to have a lower turnover rate as he wants to be the only game in town.

Generally if you go for a strategy like this, you will also face a lower concentration of tech professionals so I am not too sure whether it will always work in practice. It might have the benefit of attracting folks who are into lifestyle design as one of the negative issues faced by places like Silicon Valley is that the cost of real estate escalates faster than average income growth.

Which is why a Singapore rentier should always subtly support government initiatives in Ayer Rajah Crescent because while the direct beneficiaries are engineering and technology professionals, the real beneficiaries are the owners of real estate.

Saturday, January 14, 2017

Tool for Titans #37 : Put the Big Stones into the Jar First

This section is on the father of Progressive House Music DJ Kaskade who was nominated for the Grammys five times. After reading this short section twice, I have no idea why this is in the wealth section.

Anyway, I'm just going to talk about that famous metaphor where the professor asks the university students to put rocks of different sizes into a jar. If you put the smallest rocks into the jar first, there would be insufficient space to put the large rocks later. Instead, the optimal approach to maximise the use of the jar would be to put the largest rocks into the jar first before the smaller rocks. This maximises the use of the jar and you can even put some sand into jar later on.

While this is a good metaphor to advise people to make room for their biggest priorities, the folks in their 20s will not even know the size of the rocks before they start prioritising which rocks to put into the jar first.

Are are limits to how far a good metaphor can go in assisting us in life decisions.

I just had a meet-up with my buddies and just now we suddenly had this really candid conversation about what my buddies had originally planned to do about setting up a family when they were much younger.

The story began when we gossiped about a friend who supposed had his life planned out after junior college, he was supposed to have a stable job with the uniformed services and would be happily married in his early 20s. Life did not turn out his way because he had some pretty bad patches in his relationships and now completely turned off on the idea of marriage.

Then some other friend shared about his own initial goal of marrying young because he thought his life would be modelled after his dad. For other various reasons, he too, remains single today.

I am currently the only married guy in my usual group. When I was in university, marriage was the last thing on my mind (although I was a horny desperado in the later stages of University life which led to many misadventures and some  encounters which I may probably write about one day on this blog).

Furthermore, my dad married late for men in his generation, so I was fighting hard to marry later than he did ( which I did ), instinctively I wanted financial freedom as a single man before I took the plunge.

As an engineer in my 20s, I had no Culture in my life. I had no Art. A few years down the road, I would have a HP12C calculator. ( I soon learnt that if you have a HP12C and master reverse polish notation, you neither need Art nor Culture in Singapore. )

My obsession was money, playing Dungeons and Dragons and building a solid career.

After reading Robert Kiyosaki, I figured out that as a male without economic resources in my 20s, I basically had a Lan4 Ming4 Yi4 Tiao2 - A worthless life which I can throw into my career.

How did the family rock appear in my jar when I did not prioritise this early in my life ? Why do I even have kids today ?

Why do some couples pay me to listen to my advise on relationship and personal finance today ?

( Maybe they just want to listen to Thomas or Lionel. )

But the moral of story is that metaphors are great.

But having an Intention does not equate to an outcome.

Your large rocks can mutate into small rocks when your personal circumstances change.

And sometimes your jar just breaks and you need to get a new one to move on with life.

Friday, January 13, 2017

Money & Love Event : My take on the event

The one big talk for 2017 is over. Before I get back into finishing up law school, here are my thoughts on the event yesterday.

If I can redo the event all over again, I will make two changes to the programme.

First, I will work closer with SDN or ROM to find sponsorship and scale the event to invite a bigger audience. But we are still a bunch of financial bloggers who are trying to bring a new kind of seminar into this market. For our next event, I am pitching towards an event which is friendlier to sponsors so that we can do this on a larger scale and may even be able to pass on cost-savings to customers.

Second, I think a lady speaker would make our event so much better and so much more relatable to the women in the audience. We were initially expecting more husbands to show up but ended up with a balanced crowd. A woman's perspective would have added so much value last night.

We are now processing the feedback from the audience and more will be said over the next few days. One feedback is that we did not answer one question properly on how our finances changed when we transitioned from being single to being married.

That being said, I just thought I'd share what I liked the most about what the other speakers said. This is because for BigScribe events, the speaker is also part of the audience and I am listening to Thomas and Lional speak the first time last night :

a) 15WW / Thomas Zhuo

Thomas' presentation is really useful to me because it addresses many personal question I had for the past 20 years. There is always this arrangement I know that university students make with each other during their undergraduate days about settling down early and getting married upon graduation which I never understood because women wouldn't touch me with a 10 foot pole 20 years ago. How do these peeps know that their significant other is a the right one when they haven't even started earning money yet ?

Thomas' best idea is his justification for marrying early. When you marry at a younger age, you get the best subsidies and can obtain a cheaper mortgage since houses which appreciate with time. Marry later, and you might bust the income requirements to buy a HDB. Subsequently, the appreciation in the value of your real estate will exceed what many couples can save if they opt to live with their parents or remain single.

Of course, the caveat is that property goes up in value as they have done in the past.

b) Cheerfulegg / Lionel Yeo

The great thing about bloggers coming together is our different styles and I'm glad Lionel gave a very upbeat presentation on his approach towards managing his personal finances. If I'm Batman, Lionel is Superman. This blog channels fear and encourages gritty skepticism. Cheerfulegg channels hope and encourages moving towards a happy and fulfilled life.

Last night, Lionel distilled his ideas into a framework which made taking actionable steps very easy for listeners. Now I don't really want to discuss Lionel's entire framework because it is vary valuable and something which should only be shared if you can consult our paying customers, but I just want to share one really useful tip I learned from Lionel.

In my earlier books, I recommended employing a second savings account to assist in keeping a budget. When your salary arrives, decide on how much you want to save and immediately transfer that amount into this second account. This way you pay yourself first through a process I called salary truncation.

Lionel has a more sophisticated operation. He employs the OCBC 360 account which allows him to create many micro-accounts like Travel and Restaurants. OCBC 360 also let's him automate transfers from his main account a day after he receives his salary.

[ Note : OCBC does not pay me a single cent to say this ]

The ultimate benefit from such an expert move on automating your finance is the amount of mental stress it frees up so that you can live the life of your dreams.

What to expect in the future

BigScribe has now two fully sold out events and the feedback so far is that we somehow managed to the get the formula right. We will be conducting our meetings to see if we can conduct such events on a more regular basis and I have already pitched to the directors what I hope to do next.

If you like our events, please share with me what kind of things that you'd like us to talk about. Collectively our research and delivery capabilities are reasonably strong and you should not constrain yourself to simply investment content.

Thursday, January 12, 2017

Tools for Titans #36 : Some Quick Tips.

[ I am wrapping my work for today to go to the venue where I will be giving the talk later. Fortunately, today's article is very short. ]

Noah Kagan is the thirtieth employee of Facebook and the fourth employee of Mint.com. He is quite short on life philosophy but quite extensive on life hacks.

Just three ideas from him :

a) Increase your productivity

One instant way is to increase the speed of your mouse tracking. Another is to get a higher-end router.

b) Remove distractions

Facebook can be very distracting. One way is to use a Facebook newsfeed eradicator. I just shut off news I don't like.

c) The "+" trick in gmail.com

Someone should try this and let me know whether it works.

Suppose your email is bob@gmail.com. When signing up for a website like Simisai.com, try signing up with the email bob+simisai@gmail.com. Messages will still arrive on your email but you will know instantly which website is is spamming you.

That's all for today !

Wednesday, January 11, 2017

Tool for Titan #35 : What makes a successful salesperson ?

Daymond John is the CEO and founder of FUBU. He has won many business awards.

As this section is rather incoherent, rather than focus on what was said in the writeup, I would just take the opportunity to deconstruct a common trope in Singapore which is the successful salesperson.

I grew up in a retail environment so I had a lot of exposure to the folks my dad hung out with.

One person you would encounter is the "successful salesperson".

This salesperson may adopt a particular approach to life :

a) Life is about chionging (Aggressively taking risks ).

You don't need Minister Ng Chee Meng to tell you to chiong in life if you are a salesman. A successful salesman is all about chionging. It's not an easy thing to do, but the door gets slammed in their faces on a regular basis so they need to cultivate a thick skin and just get the job done.

b) The best motivation is being broke at one point in your life.

This is explained by Daymond's book The Power of Broke. If you read about those MDRT insurance folks, you will inevitably read up on stories of them going broke at one point in their lives and not having enough to pay for electricity.

As a family man, I don't like being broke even once in my life. However, I actually enjoy simulating poverty.

c) Education is unimportant to the salesperson.

Because I grew up in a pet-shop which is hardly the kind of place to be an intellectual, I used to get ragged by two kinds of folks who do not take kindly to my academic inclinations. The first are oil riggers who make more money than most medical or legal professionals. I'm actually fine with them because what they lack in education, they make up with solid hands-on skills.

The second group are salespeople.

Sales-people make a living by persuasion. I've seen some really horrible tricks pulled by shop-keepers to impress ex-pats to unload thousands to buy rose-wood furniture while I was growing up. If bullshit can be so profitable, going into further studies will probably be an impediment to financial success. You will notice that this anti-intellectual message is very common and much welcome in the insurance and MLM businesses.

The combination of my dad's buddies disapproval and scorn throughout my rebellious teenage years probably shaped me into what I am today.  It actually pushed me deeper into my books. I wanted to beat these sales fuckers in my own game. This also explains why I have never engaged an financial planner in my entire life. Everything for me is self-taught and self-bought.

Salespeople are in a losing proposition for many years now. Consumers are getting smarter and everything can be verified by going into the web. While personal relationship building still matters, a salesman needs real credibility and books on consultative selling has been dominating the bookshelves for years.

What's more important for everyone is to know what happens to these oil-riggers and salespersons at older age. What I learnt is that living on bullshit and manual dexterity makes it harder to developer the intellectual skills required to manage their money. Many failed to preserve their wealth and hardly transitioned into good investors.

Instead they continued to drown themselves in beer.

As I converted my father's physical property into investment assets, at a late stage of his life, he too was able to enjoy a monthly stipend higher than most working professionals. My mum even joked as to why i did not teach my dad how to invest when I was 9 years old, we would avoided a major business loss in the 1990s.

These few years my dad finally admitted that his friends are all not doing all that well, with many selling off their real estate assets to support the the last years of their life.

Tuesday, January 10, 2017

Tools for Titans #34 : Build something which have no value in others copying them

Chris Young is an inventor and tinkerer who is co-author of this mind-melting book called Modernist Cuisine.

The one single idea in this section which is worth thinking about is a question of what we would build if we have $100 million that would have no value to others in copying. This question encapsulates several more important questions we need to ask ourselves before we get into the start-up space. It has implications when we invest in technology as well.

One interpretation is what kind of barriers to entry will we erect against competitors. The example shared is about Intel chips. It is so expensive to produce Intel processors that competitors would rather not invest the billions of dollars to copy Intel's designs.

Another related idea is the question of how much your own revenue can cost an incumbent. If every $1 you make costs an incumbent $10 in lost sales, the incumbent is better off investing in your company than resisting you in this new space.

Right now Singapore is slowly waking up to the idea of legal tech. We are seeing a lot more press coverage on legal start-ups and the government is starting to get law firms to buck up and become more productive.

As we get more coverage on legal tech. We will see a lot more push back from the legal industry about how much bespoke work lawyers bring to the table and why lawyering will be never be affected by the latest and greatest developments in artificial intelligence. I have tried playing with smart contracts and even the spreadsheet from the Legalese website and I think we are quite a few years away from any meaningful revolution right now in the legal sector.

The question of whether lawyers will be replaced by software is not the right nor politically correct question to ask right now. You will be up against the most powerful Guild in Singapore.

The question to ask is whether a combination of new technologies with capable legal professionals can generate revenue via productivity improvements at the expense of the incumbents in the legal industry.

As it stands, these startups can hardly generate any revenue so the $1 revenue of such a firm will not be able to create any loss to the incumbent even within the short and medium term.

But the game has only just begun.

Monday, January 09, 2017

Tools for Titans #33 : The Rule of 3 and 10.

Phil Libin is the founder of Evernote and its executive chairman.

There is only one point in this write-up which is about the Rule of 3 and 10. Phil learnt this from Hiroshi Mikitani who is the founder and CEO of Rakuten.

The theory is quite simple.

If you build a company, expect everything to break every time you grow 3x or 10x its size. Actually as 10 is very close to 3 x 3, it's possibly reasonable to argue that everything breaks when your organization triples in size.

This idea was created to caution founders who run growing companies who may suddenly find themselves with outmoded systems and processes when their company grows too fast. The opposite applies to larger companies which might be wasting too much time on innovation initiatives when the next growth milestone may be years away.

Several points are missing from this write-up.

As the idea is Japanese is origin, Phil should have appreciated that some forms of innovation are incremental in nature. Large companies can invest in incremental improvements like TQM which could result in massive profit upgrades in spite of not growing at break-neck speeds.

Finally, an investment portfolio scales way better than individual companies. Unless your investment strategy goes into the billions which prevent you from investing meaningfully in Singapore small caps, you can generally employ the same ETF or dividends strategy as you move from $100,000 to $1,000,000 or even $10,000,000.

Although Tim Ferriss subsequently invites readers to ask themselves how they are complicit in creating conditions that they do not want, I find that this rule of thumb is not as useful when applied at a personal level.

Sunday, January 08, 2017

2017 is all about Donald Trump !

On 20th January 2017, unless something really drastic happens, Donald Trump will become the next President of the United States. As SMU's only law student who supported the Republican ticket in 2016, I promised my classmates a dinner buffet if Trump won the presidential election the day before the election results were announced. I figured that there was only about 16% chance Trump would win over Hillary Clinton but lo and behold, it suddenly dawned on everyone that the party would indeed take place !

To understand the mechanics of a Trump victory, I strongly suggest that a disappointed liberal or a triumphant conservative should try to read JD Vance's Hillbilly Elegy. It not only details the disintegration of a a southern white town in the US, it chronicled how a hillbilly overcame life's obstacles to graduate with a Law degree from Yale.

Here are some things which jumped at me :

a) Try not to equate a Hillbilly with an Ah Beng

The first thing a Singaporean reading the book would instantly equate a Hillbilly with an Ah Beng. Try not to do this. Even our worse off Ah Bengs are not even half as tragic as a Hillbilly living in a town where a major plant or mining operation has ceased to exist.

Hillbillies have to deal with drugs in their everyday life and are effectively segregated from more successful whites from coastal towns and cities. I definitely credit our own government with desegregating the races when in the 1960s.

The books also raises an interesting point relevant in Singapore politics. Welfare which targets non-working poor may make life better for them, but it enrages the working poor who are struggling and faced with higher taxes. This is something we need to think about before we give in to welfare schemes here.

b) Yale Law school is light-years ahead of my own law school experience

There is another food for thought for law students here. JD Vance's encounter with Amy Chua the Tiger Mom was featured in the book and would make a great reading for all local law students.

While Yale costs 4-5x what I pay for my own program with SMU. The lengths Yale professors would go for their students is almost unfathomable in Singapore.  After pulling strings to help the author, Amy Chua went as far as to dissuade JD Vance from a clerkship because she felt that he has a great relationship with his girlfriend and should not prioritise his career over their relationship. As I am a big fan of the Tiger Mum, I am glad to read an anecdote which humanises her.

Other stories of Yale alumni coming back to campus to assist juniors in preparing for law school exams is also make me envious. But on balance, I would still prefer my fees to be lower, thank you.

c) Marines look after their own kind

The author would probably still be languishing away in Middletown if it wasn't for his stint with the Marines. The Marines straightened him out and may actually be that magical "conscientiousness" raising pill for many lost young men.

Marines really look after their own kind, which is very unlike the SAF. A senior Marine would go as far as to assist a junior when buying a car so that his money goes a longer way. This allows the warriors to stretch their dollar when their monthly paycheck is $2,000 SGD at most.

Anyway, I'm going to end with making some predictions on the Trump presidency :

a) Trump is very likely to reduce regulation faced by Wall Street. This is in line with business interests.
b) Trump is like to succeed in building more infrastructure during his stint. But this infrastructure will not include a Wall of Mexico.
c) Trump is less likely to start a trade war with China. If you think about it, businesses in China and the US would hardly benefit from a trade war so I doubt this would happen.

Will I be right ?

Only time will tell...

Saturday, January 07, 2017

(On Upcoming Talk ) Tools for Titan #22 : Picking the right audience

Tracy Dinuncio is the CEO of Tradesy who has raied $75 million from various prominent investors in spite of being born with a serious birth defect.

This section is short and has only one point on picking the right audience. So this is a great opportunity to share some details on planning which is going into our next talk which sold out yesterday.

I originally pitched this idea as a bootcamp for couples who are planning to get married, even promising myself to incorporate another company if I can't get a law firm to accept me this year if I turned out to be the only believer in this idea. This would have been a part of a series of bootcamps for people who are in different stages in their lives. The vision is that the company would have a product line of courses which show ordinary people how to plan their finances based on their specific personal circumstances. Running these bootcamps can then sustain our company moving forward.

But our company is unique in which every shareholder including myself has something more serious to do than to work on this company initiatives exclusively so we could only experiment on something on a much smaller scale.

As the investment content on our next talk is going to be a lot lighter than our previous talk, I was initially sure that sales would be much slower. However, we still sold out within 3 days for a larger venue which is largely credit to Lionel Yeo and 15WW who have a very strong and dynamic readership.

So this process is very much like doing A/B testing. We are selling 50-60 tickets to readers and providing content which goes beyond the value of a single session because, at least for me, I wish to keep an option to scale it into something much larger.

So, if you paid for the tickets, please keep the feedback coming. If there is another event before the mid-year, I expect to pitch something more technical and targeted at yet another different crowd.

Friday, January 06, 2017

Tools for Titans #21 : We all begin with SUCK.

Ed Catmull is a co-founder of Pixar Animation Studios and a recipient of 5 Academy Awards.

a) We all begin by sucking at something

One thing that I learnt from this section is that art is volatile. According to Ed, the first draft of a Pixar movie is often dramatically different from the final version of the movie. I read in another source that in the first version of Frozen, Elsa was even a villain.

We have to be prepared to suck when we engage in innovation. I am pretty sure most of you would have fairly crappy portfolios to start with. For me, I started by paying 2.7%+ management fees in my first global equity unit trust.

b) If you have problems reading something, try listening to it.

This is an excellent tip which is so obvious, I am ashamed that I did not even think about it.

I do struggle with a lot of my readings because some can be dryer than legal cases. The book considers Iliad as an example, but I am sure that I will benefit from listening instead of reading Kafka or Chaucer.

I do want to process Walden by Henry David Thoreau, but reading a page always puts me to sleep. I should listen to an audio instead.

c) To become an artist, learn to see

This section held more promise than what the author intended.

As Ed did not see art classes as being enough to reach the level of a Disney Animator, he studied physics which made his friends incredulous. This lesson goes beyond the assertion that art is about learning to see.

The lesson for me is that attaining mastery of a field may not come from an obvious source. The best traders for a hedge fund are better off recruited from engineering and science colleges rather than business school.

In the 1990s, when Computer Science was still a Science degree, it did not have its current elitist air.

The folks who wanted to program in Assembly and C were better off doing engineering as it had rigorous coding classes. While the best programmers probably still came from CS, companies still liked hiring engineers to take up hardcore programming and systems admin roles. Even better than engineers are mathematics majors who can break a complicated equation down into computer code and write specialized programs for manipulation of graphics.

Wednesday, January 04, 2017

Next Financial Bloggers Talk on 12th January : Couple Finances

Most of you would have been aware by now that my next talk will be on 12th January 7.30pm at Singapore Shopping Centre. If you wish to buy tickets to this talk, please follow this link.

Once again, there will be three speakers.

Other than myself there is the super-popular Lionel Yeo from CheerfulEgg who has just recently gotten married. Another speaker is Thomas Zhuo of 15hourworkweek who has chronicled his personal journey to financial independence along with detailed information on his personal expenses.

My session is divided into two parts. For the first part, I will be covering insights I have found from social science research on marital finances. As some truths I will be revealing may be counter-intuitive or even mildly controversial, there is going to be more emphasis on researched information for the first part of my presentation.

The second part of my presentation will be on my own personal finances and how I provide a stipend for my mum and support my family of four while being a full-time student with SMU.

Here are some highlights on what I will be covering for this session :

  • Motivation behind financial planning for singles, married couples and families.
  • Differences between men and women when it comes to money.
  • Change in expenses when transitioning from single-hood to marriage.
  • Key information on wedding expenses
  • Effect of marriage on earnings
  • Expenses incurred when you have kids
  • How I manage my own personal finances
  • Pre-marital finances checklist 
  • Post-marital finances checklist

Our company is currently experimenting with talks which emphasises less on actual investing but more on general personal finance. We do expect our audience to be different from the last time and this event will provide us a platform to determine what kind of future events we will conduct for the audience.

Please give us your support. !

Tuesday, January 03, 2017

Tool for Titan #20 : The art of asking the right questions.

As school has just started, it is quite appropriate to have a short write-up today.

Today's segment features Alex Blumberg who is an award winning radio producer. This part of the book is all about asking the right kinds of question in interviews to get someone to open up.

 a) Ask a dumb question everyone is afraid of asking

The example used in the book is "Why are banks loaning so much money to people who can't buy it back ?" The answer which was not in the book is that because banks have found a way to package these loans and sell them off to other people so longer have to bear the risk of a default.

At least from a context of a law student, some questions are dumb but other questions are really DUMB. Not every industry is forgiving and some thrive on finding out what your personal weaknesses are. At least in my context, its better to ask a question after you have tried consulting the web or your research materials first before asking.  If you do your homework then ask a question, it might even impress the person you are asking.

Nevertheless, finding a simple question which may have a counter-intuitive answer is useful to listeners is great if you are conducting a radio interview.

b) Prompt to elicit a story

This is a useful tip which goes beyond radio interviews. It might even be useful in a date. The best questions elicit a story from someone else.

Try this one for size : "Describe a conversation you had with a loved one when you decided to use a dating app like Tinder to meet other people."

c) General fishing lures

 The book has a useful list of some fool-proof questions.

Here are some of my own so that this article would not ruin your experience of reading the book :

" If you could travel back in time to speak to your younger 25 old self, what would you say to him/her ? "
"If you could recreate your company from ground up, what would you change ?"

Monday, January 02, 2017

Tools for Titans #19 : How tactics become commoditised.

Ramit Sethi is probably the most successful financial blogger of all time. He has more than a million views a month and his company makes easily $5 million a week. I must admit that I simply could not stomach his material because too much emphasis was made on bargaining.

However, any write-up on how he succeeded would be something that should be worth reading.

a) How tactics become commoditised

If you understand the timeless principles, you would always be able to come up with refreshing tactics. However, relying on a tactic may make you some money on the short term, but these tactics eventually get commoditised.

This is easily illustrated in investing.

Dividends investing is clearly a tactic. Finding a stock with a high dividend yield and sustainable cash flows is a useful tactic to make above average gains. This can be proven by backtests on Bloomberg.

The principle of backtesting, noting down returns and the standard deviation is a broader strategy than dividends investing which some of us like to do. The Financial Analysts Journal this month has a great article on how to refine a dividends investing strategy and reports a higher Sharpe ratio when an investment portfolio is targetted at mid-cap value stocks. I will be testing this out in SMU"s Bloomberg terminals this week to confirm whether it works in local markets.

My practice of reading investing white papers, networking with investment bloggers, backtesting and then building the portfolio gives me the ability to have a formless approach towards building portfolios based on timeless principles instead of tactics.

Even my friends who were drunk on Technical Analysis 10 years ago are talking about dividends these days.

b) Products should adopt the barbell strategy.

Ramit does not not call it a barbell strategy when it comes to product creation and launch. I thought Nicholas Taleb's idea of the barbell would be helpful in consideration product creation.

Close to 99% of the stuff produced by Ramit is given away for free, but when he has to charge for a physical appearance or a premium product, he goes for the jugular and charges fans $7.5k per seat.

This dualistic strategy works because the free aspect of the strategy gets you the eye-balls  but the paid strategy maximises the revenue for the least amount of effort because the profit margin is so high.

I highly doubt that this strategy is realistic for folks who are not Ramit Sethi. Us bloggers are planning our next event and we can't charge such a high premium yet. We're better off keeping our costs reasonable and ensuring that we can sell every ticket we have.

c) 1,000 true fans

Many readers may have heard of the 1,000 True Fans doctrine by Kevin Kelly. Get 1,000 true fans who would buy anything from you and attend all of your talks and everything else is just about churning out products which maintain your popularity. Everything else is ensuring that you cut away enough middlemen to extract profits from product sales. If you create a $100 product a year and you have 1,000 true fans, you will have income of $100,000 a year.

It is almost the same as Dividend's investing ! I've always been harping about getting $300,000 invested at 8% a year for a reasonable income at around $2,000 a month.

But it's probably easier to earn money from  a regular job to get $300,000 than to even get 10 true fans.

( I have great readers who interact with me on this blog, but I highly doubt that I even have 10 true fans here right now. That would take a longer time. )

But let's not think in terms of absolutes. 10 true fans who pay $100 is $1,000 extra income a year. Not to mention the 50 plus or so casual fans who will probably buy a book for $30 and netting you another $1,500.

1,000 true fans is a great goal. Question has always been what system you need to adopt to get true fans.

Gurus tend to be silent when confronted with this.


Sunday, January 01, 2017

2017 is about devolution, not resolutions.

Perhaps because of the backlash against new year resolutions this year on social media, I very much prefer not to go through the process of making new year resolutions for 2017. Most of us fail to track our progress throughout the year anyway.

I think the best thing a 40-something guy can hope for is that things devolve less than before. We are no longer at the age where a new year brings a new and better person with better social and financial outcomes. I am in fact three years away from the 45-54 year old dip for middle-aged men, which has been shown to be the most miserable years of a man's life.

But I think I am way better prepared for this compared to many guys my age.

Anyway, here's what I have to look forward to in 2017.

a) Financial Markets 

I am cautiously optimistic about the future because even as 2016 has been a really bad year, the impact to a defensive income portfolio is minimal. Even if things do not improve in 2017, we would have a great bargain hunting season which would have lasted one year.

As much as it is impossible to predict what a Trump presidency will bring to the world, it is amazing how much other world leaders are looking forward to cooperating with him. But based on metrics like CAPE, my guess is that the US market is not likely to see much upside in 2017.

So flat markets in 2017.

b) My progress in SMU Law School

Three years is far too long to obtain a new qualification.

I am already facing some fatigue and a lack of motivation to study as hard as before and it showed in my grades last semester. Perhaps a better JD program would be built if it were offered part-time for 6 years but I'm itching to use my newfound skills for anything I see at work.

Nevertheless there has been some good progress in this front. I managed to land at least a promise to develop my legal career further in a law firm in 2017. It's been very hard not getting interviews based on my age and so-so grades but I'm glad to get something solid once I had my first serious legal interview a couple of days ago.

c) Managing portfolios professionally as my plan B

As the economy is unpredictable and I could screw up in my subsequent internships, I always make sure that have a plan B. Right now I am in very tentative discussions to examine a career in portfolio management as a remisier.

Over the years, many friends have asked me if it were possible to help them manage their money using the techniques I built over the years.  So right now, there is apparently a way for me to do this but I need to accumulate my fund to a substantial size ($7m - $10m) before I can survive on this job because it is not an in house fund management role.

If you are a reader and would like to consider putting some money with me, do write to me privately to help me assess the feasibility of this career path.

As I have said, this is only a Plan B.

d) Exciting stuff lined up

Right now, me and some bloggers are trying to do one talk first quarter of 2017 but I'm not too sure whether it will materialise soon. But I am always ready to give talks anytime. Just write to me to make enquiries.

Another possibility is one TV appearance in the works but that is one long shot.

e) I hope that everything is ok at home in 2017, but I am prepared for the worst.

2016 has also been particularly rough for my family and I spent a lot of time at the hospital last year.

My mum had a scrape with breast cancer. Then my dad fell down on CNY eve and also on Boxing day so he just came back yesterday from a 5 day hospital stay. My kids have to be sent to KK a couple of times when they had some fever or asthma-like symptoms.

I hope 2017 would be more drama free, but we're pretty much prepared for anything after 2016. My parents are not getting any younger and neither am I.