The Ungoverned

Thoughts on man and his universe
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  • David Veksler

How to invest your money – from $25K to $5 million Aug 13, 2017

Your first $25,000 should be invested in an all-market (VTI) or S&P 500 index fund (VOO) in your 401K or IRA. Your first $500,000 should be invested in a broad market, low-cost, diversified portfolio of large/small cap and some international index funds. After you reach $500k, you need to invest the majority of your portfolio into individual stocks.  At this scale, tax efficiency becomes increasingly important, and you need an actively managed portfolio which optimizes the tax allocation of investments (growth stocks into taxable, REITs & bonds into 401K, etc), minimizes trading frequency, and practices tax loss harvesting (sell losses...

By David Veksler Vote4 0

Where do prices come from? Aug 10, 2017

Very few of us have the opportunity to experience the heart of what makes our civilization work. Crypto-asset markets are one of the few places where you can participate in a real asset exchange without spending a decade getting training and certifications. If you want to try your hand at playing Wall Street trader for a day, this is the place to be.

By David Veksler Vote11 0

Why I’m betting on the future of Bitcoin Aug 2, 2017

Five years of living in China spoiled me in terms of financial transactions. Most people don't use debit or credit: they either use cash or more commonly, send money electronically via mobile apps. Mobile wallet apps are often used for large payments, and your landlord or utility company is just as likely to accept them as the friend you're splitting lunch with.  You can login to your bank's website or ATM and send someone a million dollars as easily as a few bucks. Then I moved back to the U.S. I owe several thousand dollars to a friend. At first,...

By David Veksler Vote5 1

Four secrets for getting the most out of your company’s 401(k) Jul 23, 2017

Here's how to get the most out of your company's 401(k): 1 Set your savings rate high to max out your contribution early in the year You can invest up to $18K per year into your 401(k) (plus $6,000 if you're 50+).  Regardless of how much you plan to contribute, you don't have to split your contributions evenly throughout the year.  If you set the savings rate high, you can invest the entire amount you plan to invest in your 401(k) early in the year, then save up for other goals for the rest of the year.    I set...

By David Veksler Vote7 0

Here are the 10 cards I keep in my wallet Jul 22, 2017

As promised, here are all the cards I keep in my wallet*, with a rationale of why I acquired each card.  Jump below the image to read why I got each card:     I have two criteria for credit cards: No annual fees: I don’t spend enough to warrant paying an annual fee for any card. Cash back only: I don’t mess with complex point systems which only encourage spending.  I just want some money back on my bill.   American Express Blue Cash My favorite card.  Why?    3% back at supermarkets 2% back at department stores and...

By David Veksler Vote7 1

The sapient mind is a parasite Jul 17, 2017

The conscious, rational mind is a parasite which has hijacked the homo sapiens species for its own purposes. For billions of years, life on earth was organized by genes directing primitive bio mechanical systems. Recently, the genes began building neural networks with built-in instructions, and even the capability to pass learned behaviors between generations. But the genes screwed up royally when they enabled the replicators doing their bidding to override their programming and develop a culture of their own. You see, when homo sapiens invented culture, they gained the ability to overrule their genetic programming and do whatever their rational...

By David Veksler Vote4 2

Here is the best personal finance & budgeting app Jun 3, 2017

I tested all the popular budgeting and personal finance tracking apps out there: Mint, Personal Capital, Truebill, Prosper Daily, Albert, Level Money, Proper Daily, and more. These apps can connect to most banks and credit card companies to pull your transaction history and track your spending. Some of them can monitor and help you cancel recurring subscriptions, or recommend relevant (or not) financial products. Most of the apps I tried ran into problems such as double-counting credit card charges and credit card bill payments, classifying bank or brokerage transfers as bills (Truebill), not showing pending charges or credit refunds, unable...

By David Veksler Vote5 1

Laziness must be learned May 29, 2017

After reading the "toddler maximum effort" story, I was thinking back to when Sophie was an infant. I noticed that while she was crawling around or playing, she was usually covered with sweat. We adults sometimes think that because kids are not good at the things we take for granted, their play is not focused or meaningful. In fact, babies are far more likely than adults in engage in prolonged "maximum intensity" effort. Productivity is our default mode, while laziness must be learned! The activity we call "play" refers to its low economic value to adults, not to a difference...

By David Veksler Vote4 2

Company scrip and other great ideas pushed out by employment regulations May 28, 2017

The relationships between unrelated services that the government imposes on us often don't make any sense: * Why should my choice of doctor depend on my job? * Why should my kids be forced to attend a school based on where I live? * Why does my retirement plan depend on the provider my employer choose? But other relationships would probably be more common if the government did not force them to be separate: * Why doesn't our employer pay for our education? If a certain skill is needed to perform our job, then our employer could pay for it...

By David Veksler Vote2 1

Dear NPR: “Steal from the rich to give to the poor” is not a genius new economic theory May 27, 2017

I've been avoiding TV and radio for many years now, but I catch glimpses of NPR now and then because my wife listens to it in the car. It usually only takes a few minutes to remind me why: A "human interest" story features an average guy who figured out a "trick to save social security." This "amateur economist" has a "brilliant" proposal: eliminate social security taxes on middle-class incomes by raising the cap on earnings subject to the Social Security payroll tax. So: steal more from middle-upper families and redistribute their money to middle-lower families. This is hailed as...

By David Veksler Vote4 2

How learning to hurt people helped me deal with chronic stress May 24, 2017

I like going to Krav Maga practice because it's very practical: each session is about learning how to maim and cripple your opponent until you eliminate or escape the threat. Technique is key, but during most practices, there comes a time when I am exhausted during an exercise and have to find the strength to continue. It often comes out as a roar and a total focus to finishing the task. Every athlete knows what that feels like. How do frequent sessions of learning to hurt people change a person? I was driving today, and someone did something that upset me....

By David Veksler Vote8 2

Introduction to Modern Portfolio Theory Apr 30, 2017

The key principle you must understand to have a well-balanced portfolio is modern portfolio theory. Although the idea was introduced in 1952 by Harry Markowitz (who got a Nobel for it), it still doesn't get the central focus it deserves in investment planning. Like the efficient market hypothesis introduced by Friedrich Hayek seven years earlier (who also got a Nobel for it), it is a very useful theoretical model to understand the relationship between investment risk and performance, but should not be abused by failing to question whether its underlying assumptions hold true in particular cases. Let me try to...

By David Veksler Vote6 0

How to prepare your life for the Technological Singularity Apr 22, 2017

If you believe that a technological singularity is coming in the 2030's, is there anything you can do now to prepare? Yes, plenty: Career: As increasing automation replaces rote human labor with machines, work that requires creativity, adaptability, and self-direction is becoming more valuable.  Expert systems will augment and then replace technicians, and deep understanding and expertise will fall in importance relative to broad cross-functional heuristics.  Engineering and programming will increasingly be performed by creatives working with high-level design tools, while algorithms work out the technical details.  "Employment" itself will become obsolete, and most work will be performed by either temp workers...

By David Veksler Vote10 2

Why you (probably) don’t need life insurance: how to self-insure your family Apr 6, 2017

I'm not categorically opposed to life (and most other kinds of) insurance, but if you follow good financial practices, you're better off self-insuring.  Self-insurance is essentially the idea that you assume a risk instead of paying an insurance company for the service, either by not taking out the policy at all, or selecting a high-deductible. This requires financial discipline and planning to keep sufficient savings to pay for emergencies. Here are my thoughts on why insurance doesn't make sense in most cases. I'll focus on life insurance, but it applies to many others. When (term) life insurance makes sense: I'll...

By David Veksler Vote4 0

Four income streams that young professionals should develop Mar 28, 2017

Whether you're making minimum wage or pulling down $250K per year, if your day job is your only source of income, you should start working on developing additional income sources. The biggest reason to do so is to start transitioning from working for your money, to making your money work for you: you need passive income sources which build wealth with minimal effort. While you might never want to retire, financial security (not being financially stressed by losing your job) is something you can achieve in your 20's, and financial independence (not needing to work a regular job at all...

By David Veksler Vote5 1

The myth of rising house prices Mar 26, 2017

One the biggest myths about buying a home is that it is an investment. An investment is an asset which tends to go up in market value over time. But consider what would happen if this were actually true: if home values increased faster than inflation, pretty soon no one could afford a home! In fact, home values for the most part barely keep up with inflation. The math is complicated by a number of factors: the size of homes keeps getting larger, so comparing the average home price now versus 30 years ago does not mean that any specific...

By David Veksler Vote2 0

Here’s why buying a home is a terrible idea for young professionals Mar 26, 2017

Here's the main reason why I don't think young professionals should buy a home: If I get fired or quit my job tomorrow, it won't be a big deal. I'm confident that of the seven billion people on this planet, there is a person or group somewhere who will find my skills valuable enough to pay me enough to support my family. It may take me some days, months or years, and take me to Kentucky, Seattle, Shanghai, or Kathmandu, but I have no loans, debts, or any other ongoing financial commitments, so my savings will last long enough until...

By David Veksler Vote8 2

The myth of America as a “Judeo-Christian” nation Mar 15, 2017

The term "Judeo-Christian" was invented in the 1940's as a response to the rise of Nazism and anti-Semitism in America. As a historical fact, the idea that America is a Judeo-Christian nation is nonsense. In many ways, America represents a rejection of Judeo-Christian values. At the time of the United States' founding, the vast majority of Christians and Jews lived in outside America - and they held very different moral values than Americans. Everything that defines America - the belief in the inalienable rights of the individual, the importance of property rights and free markets, equality before the law, and...

By David Veksler Vote4 0

Why most university degrees are worthless, Part 2 Feb 22, 2017

When I say that "most university degrees are worthless" I don't mean "no one should go to college" or "drop out of school now." I mean that the objective value of university degrees is more often than not negative. If governments stopped subsidizing higher education, the vast majority of young people and employers would find a way to match with each other without wasting four years. By this, I don't mean "in a theoretical utopia you don't need to go to school, but in the real world, you better start on your applications." The fact is that many, if not...

By David Veksler Vote2 0

A letter to my broker on the Fiduciary Rule and the repeal of Dodd Frank Feb 21, 2017

The CEO of my brokerage firm asked for my support in opposing the Trump administration's plan to roll back the Dodd Frank Act and the Fiduciary Rule for retirement accounts, which would require brokers for retirement accounts to act in their client's best interest. Sounds great, right? This is what I wrote in response:  Dear [CEO's Name], Please allow me to share a few thoughts on your request as a client of [Firm Name]: I appreciate that you believe that the Fiduciary Rule and the Dodd Frank Act are in the interests of consumers and the economy. I respectfully disagree....

By David Veksler Vote4 1

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