Blog

Short blog posts, journal entries, and random thoughts. Topics include a mix of personal and the world at large.

All about leverage

Looks like it doesn’t matter that I can deadlift 300 pounds. After a few hours of working on my car, bending and squatting, my lower back is barking like mad all the same. Though I’d be in even worse shape if I hadn’t been exercising the posterior chain at all…

While I do enjoy working on cars, the aftermath is always painful. The skinned knuckles, the bruised fingers, and soiled clothing. All part of the deal, of course. Like callouses on the hands for weightlifters. I can’t fathom being a mechanic for a living. Physical labor is really tough on the body. I’m gladly surprised my father came out of 30 plus years in construction with only some mild nagging joint pain.

These days it’s popular to invoke the trades as an alternative to university. Indeed it is! Having alternative options is a positive. However, the trades are hard to scale. You can only climb into so many HVAC ducts in a given day, or unclog so many toilets. The monetary upside is largely capped. Just about the only multiplier is branching out and being your own boss. Have people under you to climb many more ducts.

Going to college offers a higher ceiling. Knowledge work can continue working even when you’re done inputing. Simply look at the many software engineers making upper-middle class living. Or study to become a white-collar professional. Hours will be long on the outset, but the monetary compensation for careers like lawyers, bankers, and medical is high.

And what that high income allows for is compounding. It’s far easier for a $200,000 dentist to invest in the stock market than a $100,000 plumber. And that bigger initial pie will only grow larger faster. The law of large numbers comes into play.

The word here is leverage. Maximize the size of the output with the set amount of input. A job is a job, and power to those who are doing what they got to do to put a roof over the head and food on the table. However, if there is a choice? I’m thankful I am able to trade knowledge for money, rather than manual labor. The sore hours immediately after working on my car is a good reminder to not take it for granted.

Don't cry for Argentina

We’re all aware there's been a slew of tech layoffs in the past few years. The latest victims to the great culling is 10% of the META workforce. What I don't understand is how on earth then are rents in the San Francisco Bay Area still so god-damn high? You'd think with all the tech firings, there's got to be a net negative pressure on demand in the region. I guess not!

For those of us in the peasant class, it's difficult to muster sympathy for these highly-paid workers losing employment. It's simply math: a software engineer with a total comp of $250,000 getting fired is not the same as a Target team member losing all his shifts. Above a certain sustenance level, the amount of extra money earned allows for plenty of leeway. I would generally say that any laid off tech worker that don't have at least a year of runway money stored up is doing it wrong.

Of course that is predicated on spending discipline. A deep six-figure earner who lifestyle inflates is in no better position mathematically than someone making $50,000. However, it's far easier for the high earner to shut off the spigot and reverse the deficit. The high inflow is such a strong lever to tackle debt. $25,000 in credit card debt means differently for someone earning $250,000 compared to $75,000.

To quote Andrew Yang: "It's just math."

I'd argue that any software engineer, after a decade of work, who does not have at least $1 million socked away in equities, has done it incorrectly. You’ve got a generational opportunity at earning an outsized income! It's just smart of save a chunk of it for much later. Besides, isn't the FIRE movement largely made up of tech workers busting ass for a solid decade and stocking up enough to last for the rest of life?

The extravagant compensation comes at the expense of job security. This isn’t public government work, where you expect to stay all way to retirement on that sweet pension money. Therefore the onus is on the tech worker to absolutely save for a rainy day. And if you didn’t, and you got laid off in recent times? Again, don’t expect sympathy tears from the peasant class.

I don't have money

These days I am seeing a lot of FL5 Honda Civic Type Rs on the road. It’s a real curiosity because one, Honda does not produce many, and two, the Type R is rather expensive. A cool low $50K when it’s all said and done (got to pay the tax man, you know), and then there’s the super high insurance premiums. (Thanks to the totally not a war in Iran, gas is not cheap either.)

How are folks affording these cars?! The demographic of Type R buyers skews young, mind you. This isn’t a case of boomers buying cars they can easily budget for. I myself can mathematically afford an FL5, but I simply would not be comfortable plucking down that much money on mere transportation, even if it looks and performs awesomely.

Perhaps I’ve aged out of being irresponsible with money vis a vis cars. I’ve done it, thankfully financially recovered from it, and have no desire to do it again.

Or, my mother would say: “Everybody has money. It’s you who don’t have money.” That’s probably true. Sure it’s easy to run credit and get into debt in America for shiny things, but the fact is there’s also statistically a lot of people out there with money. The median income in the San Francisco Bay Area is mathematically apparent. So it actually should not be a surprise that I encounter a large concentration of FL5 Civic Type Rs on the road around here.

It’s just frustrating sometimes that my better financial senses are restricting the possible experiences that I can pursue as a car enthusiast. That is why, out of spite, out of jealousy, and simply as a cope: I’ve stopped watching YouTube videos of cars I cannot begin to afford. Another unobtainable special edition Porsche 911? Watching about it only brings sadness.

That's just your opinion

There’s some naysayers out there who say spending thousands of dollars on plane tickets to Guangzhou, only to not explore anywhere else in China, is a waste of money and time. These people’s vision of traveling is to do as much as possible and visit as many places as possible. PTO is a precious commodity, is it not? You can lounge around and eat right at home. No need to spend so extravagantly.

Good news is, I live for me. Forcing myself to travel differently just because of the opinions of others would be peak inauthenticity. It’s like wanting a child soon as your friend group start popping out babies. Memetic tendencies that served us well ancestrally - you don’t want to be the caveman that sticks out - are no longer necessary. We can and should live how we want to, unheeding the conscious and subconscious influence of others.

I travel because I want to spend time living in places that I like. I could spend two weeks in Seoul and do nothing but hang out, walk around, and eat. The touristy stuff isn’t a must-do. The goal isn’t to check as many boxes on the landmarks list. If it were, I’d have gone to Europe many years ago, instead of visiting China every single year since 2014.

Waste of a plane ticket? Absolutely not. That’s like saying renting a place - versus buying a home - is throwing money away. It’s all transactions that we simply don’t agree on the value in return. You maximizers out there surely cringe at doing relatively nothing in a foreign city for two weeks. I on the other hand reckon that’s a lovely time. Besides, anything is better than working, right?

Oil shock

Owners of electric vehicles must be feeling pretty smug right about now. With the Strait of Hormuz closed thanks to the American President irrationally ordering an attack on Iran, petrol prices have climbed significantly in the past month. And it’s only going to get worse until there’s truce.

I’m so glad I do not have a car commute. Though if I did, I would have purchased a fully electric vehicle a long time ago. EVs are the perfect commuting appliance. The lack of combustion engine means a super quiet cabin. The torque innate to electric motors makes zipping in between traffic gaps a cinch. There’s far less maintenance items for an EV compared to an internal combustion car. The only negative is that, for those who can’t charge at home, you’ve got to wait a bit long to “refuel”.

But you’d rather have that, wouldn’t you, than paying for stratospheric gas prices. If your livelihood is car-dependent - ride share and delivery drivers - and your car uses petrol, it is currently not a very good time. Fix cost per mile has shot straight up. Another smug feather to the cap of Waymo. Their fleet of self-driving taxis is fully electric, therefore insulated from the inflating gas prices. I reckon the human taxi driver as a profession is slowly going towards extinction.

The taxi driver that drove us to the airport in Guangzhou was not feeling the gas price pinch. Because his car is fully electric. China has successfully weened itself from internal combustion vehicles. Can’t have an oil chock if you’re not dependent on oil! Perhaps it will prove shortsighted for the United States government to roll back on its EV incentives and infrastructure spend. If not for air quality, do it for oil independence.

That said, even if you drive an EV, this turmoil in the oil markets will touch you and all of us eventually, one way or another. Way too many things are dependent and correlated on the stable availability of petroleum. Gas prices is only the tip of the iceberg we can easily and initially see. There’s surely more pain to come in many other areas. I should book that flight for my fall vacation before airlines raise ticket prices…

WeChat pay the proper way

It’s well known that digital currency is super common in China. The foreigner trying to pay in paper cash money is the extreme outlier. Everybody else just tap-tap with their phones for absolutely everything. It’s like paying for everything with credit cards, but with no fees - you add money from your bank account, and with way more surveillance. As someone who has used WeChat Pay And AliPay extensively for many weeks over the years, the system is fabulously convenient.

Unless you are a foreign tourist. The two main payment platforms cannot be bound to foreign bank accounts. Nor can foreigners open local bank accounts without some sort of residency proof. Tourists’ only option is to bind their foreign credit cards, which works just fine with official merchant accounts. However, the small mom and pop shops typically carry personal WeChat Pay and AliPay accounts. Even some taxi drivers carry personal accounts. Those accounts cannot accept payment from foreign credit cards. It’s paper currency for you.

And while official law is merchants must accept cash, in practice it’s hugely inconvenient for the cash user. At pay-before-you-eat restaurants, you might be served after people who are paying with mobile. Not because of overt discrimination per se, but because the cashier has to dig up the tiller from the back. Because you might be the only cash transaction for the store for that entire day. Paying for taxi with cash? Don’t expect change in return. There’s a solid chance the driver won’t carry enough amount and variety of bills.

The ultimate flex as a foreigner is to have a local person transfer money to your account. Word on the street is many a hotel front desk person has done this. Foreigners give them cash, they transfer digital money from their WeChat or AliPay account. No restrictions, no messing around with foreign credit cards. This is how I’ve done it when I do my yearly travel to China, and it’s fantastic. A truly cash-less society is one I can get behind, because it’s cleaner, too. Currency bills are notoriously dirty. No thank you.

Dude where is my money?

Word on the street is there’s a delay in folks getting their Federal tax return. A friend of mine filed for his parents back in February, and as of writing they are still waiting for their hard-earned cash from Uncle Sam. Good news is they are not the type to desperately need their tax return to balance the personal budget. However, for those who do, they must be pretty annoyed with our government.

Sir Elon Musk must have DOGE-d a bit too hard and got rid of a few too many IRS workers.

Maybe this will be good impetus to incentivize people to adjust their tax withholdings so they end up owing the IRS instead. We’re all familiar with the pithy saying by now: don’t lend the government money interest free. And if it’s difficult for you to come up with the sum to pay Uncle Sam at the end of the year, then I think you need to first look at how you’re spending your money. Good news for pay-in-four fans: the IRS already offer payment plans!

I end up owing money every tax year, which is as it should be. 2025 I owed a bit more because I sold some securities. What I forgotten about was that the State of California treat investment gains as ordinary income, which is absolutely insane. It’s already bad enough the Federal Government takes 15% of the proceeds, but California wants to wet their beak so much that it is permanently submerged. No wonder people are leaving the state, or carry bank accounts in tax havens.

Bad news for me I don’t make nearly enough money to resort to such financial trickery. It’s truly the middle class that gets screwed. The 1% may pay the most taxes, but the law of large numbers means what’s leftover is still way more than anyone can ever need. The government taking 5 million out of my 10 million still leaves me with my own 5 million. At the same percentage cut, $50,000 out of $100,000 really hurts.