Sunday, May 24, 2015

Thursday, May 21, 2015

"The Truth About George Washington" by Stefan Molyneux

I thoroughly enjoyed this lengthy podcast/investigation about the rise and competency of George Washington.  Even if you think George Washington was god, it is still interesting to note the effects of connections and cronyism in Colonial American politics.  I would be curious if anybody from the UK or US would be able to corroborate it on account I trust Stefan Molyneux's intent and veracity.

Wednesday, May 20, 2015

Help a Fellow Cappy Cappite Find His Lost Son

Bad news every one.  A good friend of mine's son has gone missing. 

The kid's name is Danny/Daniel Domres and he is a soldier based in Colorado Springs that has gone AWOL.  The details are here, but the kid could be anywhere.

Anyway, keep an eye out for him or if you know about his whereabouts please contact the ole Captain.

If Blogs Were Stocks, We'd All Be Millionaires

An outstanding point by one of my commenters:

What's the point of trying to save $300,000 in a retirement plan paying 2%? That's only $6,000/yr in income... so, does that mean if you start up a website that generates $500/month income that it also is worth $300,000?

If so, I'd say it's a helluva lot easier to start the website than to save $300,000 - especially since it will take 36 years to double your capital with interest compounding at only 2%. 

This was in response to my original post that given the insane valuation multiples of the stock market, I can get a higher rate of return by investing in stupid ideas like this.  Yes, it's not as liquid, yes, there are no perpetual, magical "capital gains," but the cash flow (which once again is the ONLY thing that drives the value of any investment) is a lot more than a paltry 2%.  Ergo, if you really want to look forward and not be part of the 401k Clergy Sheeple Congregation, in addition to your 401k or IRA you may want to put forth a little effort into starting a little business on the side.

Tuesday, May 19, 2015

What Precisely is a "World Reserve Currency?"

A video request that turned out to be a pretty good lesson for those new, young, aspiring economists here on Cappy Cap.

Finance Industry as a % of GDP

Time for a simple economics lesson we can all enjoy.  So gather round and listen to ole Uncle Cappie.

The finance industry, technically produces nothing of value.  Yes they provide banking services.  Yes they keep your money safe.  But in the grand scheme of things the finance industry merely supports the production of stuff.  It in it of itself produces nothing of value.

Because of this you would like to see the finance industry account for as small as a percentage of GDP as possible as it would indicate the industry is being "efficient" by supporting the "real" economy consuming as little as possible in terms of resources.  Matter of fact, you'd like to see it shrinking as this would indicate efficiency gains allowing the finance industry to support increasingly more real production while consume the same or less amount in terms of resources.

So what has happened to the US finance industry as a percentage of GDP?  Well this.

While at the end of WWII the finance industry only accounted for 2.5% of GDP, today it's now over 7%, almost reaching 8% during the height of the housing bubble.

So why is this happening and why should you care?  Because it explains a lot about the global economy and portends things for our future.

First, the US economy has gone from an industrial one to one where we are increasingly  more service based.  The decline in industry and manufacturing was caused by outsourcing our industries overseas as labor (and taxes) were typically cheaper.  This helped increase services as a percent of our GDP, partially explaining the tripling of the finance industry's size relative to GDP.

Second, manufacturing is hard and math based.  If you had the choice to work on an assembly line, doing manual labor for 8-10 hours a day, or sit in an air conditioned cubicle farm clicking a mouse, most people would prefer the air conditioned cubicle farm.  And so as economies grow they prefer to pursue these "easier" industries as they are not only likely more profitable, but just plain "easier."  Alas, this is why we have "Tina the 25 year old social worker" and "Chip the investment banker" while China has "Jing the suicidal iPhone assembler" and "Chang the coal miner dying from black lung."  Modern Americans would just prefer not to get their hands dirty, and there's really no dirty hard work in banking.

This results in a sort of "tail waging the dog" as a flood of labor into banking and finance bloats the industry's size relative to the rest of the economy, while providing less and less value to the real economy.  Alas, this is why most finance positions are sales and not providing services that help the rest of the economy grow.

Third, as the world economy becomes more integrated and globalized, different countries specialize in different things.  And so instead of merely serving and selling products within your borders, you sell your goods and services around the globe.  This results in some countries becoming the manufacturing plants of the world, while other countries (notably the UK, the US and Switzerland) become the "financial centers" of the world.  In other words the US finance industry is no longer serving the US, but the entire globe, and thus its share of the domestic economy grows.

But then there is the fourth reason.  And the fourth reason is reason enough to worry.  And the reason you should worry is because here the finance industry provides absolutely NOTHING in terms of real production or value for the rest of the economy. 

The retirement bubble.

You all know my opinion that the stock market is highly overvalued due to the trillions in retirement dollars that have flooded it.  However, do not expect people to start becoming savvy investors who start asking questions about PE ratios and contemplate how dividends ultimately drive value.  Too many commission addicted salesmen and mutual fund managers need Americans to keep buying stocks, bonds, and mutual funds.  And the "401k Clergy" in the finance industry need you guys to keep mindlessly investing in your IRA's for "retirement."  This means that instead of:

financing a new plant
raising money for a new mining company
or providing the capital to expand Stark Enterprises' robotics division

the vast majority of the finance and banking industry is focused solely on selling you assets. 

And merely selling stuff does not help contribute to GDP.

It is here I get a little chuckle because 9 out of 10 times when I run into your standard leftist they immediately point to the booming stock market as evidence that "the economy can't be doing that bad."  But of course when I cite the actual measure that measures the economy (GDP) they ignore that, preferring instead to think asset prices "are the economy."  But the divergence from economic growth and asset prices is not a good thing, because all profits (and thus all the value of all assets) ultimately has to come from economic growth.  And right now we have fantastically high prices, with slow, sluggish, lethargic economic growth.

In the end, however, the two will have to converge.  We can certainly postpone the inevitable with having a world reserve currency.  We can play currency wars and borrow till our heart's content, creating entire industries out of borrowed money to keep our precious liberal-arts majoring princesses and princes employed.  But in the end, there needs to be economic growth to warrant forever increasing asset prices.

In the meantime, keeping tabs on how big a non-producing industry like finance grows as a percent of our overall economy is a pretty good way to tell if the country and its people have any intention of growing up, putting work gloves on, and starting to produce things of genuine economic value,


if we want to continue living in Lala Land where we can all be bankers, we can all be life insurance salesmen, we can all be teachers, and we can all retire on full pensions with forever increasing asset prices at 55.

Enjoy the decline.

Monday, May 18, 2015

Latest Podcast! Max Mad Feminist Road Recap Edition!

38 degrees in Minnesota
The Clarey Family Reunion
The Economics of Wood Cutting
Cappy is objectified by women...and he loves it
People need better sex lives
The Mad Max Feminist Road Drama
The media is no longer the 4th branch of government


in THIS EPISODE of The Clarey Podcast!

40 Degree Monday Morning Linkage

Because of my obtuse travel schedule, I am up Monday morning before 9AM.  Unfortunately, it is a balmy 40 degrees here in Minnesota, and I'm going to have to fire up the fireplace in the middle of May.  In the meantime here's some linkage:

DT and the Man make a point I hadn't thought of - of all the work, research, thought, philosophy and strategem, the world is so petty it focuses on the fact a guy doesn't want to see a feminist movie.

The Damnit Janet Podcast Archives (which I would have linked to earlier had Janet informed me she was putting together a podcast, but NOOOOOOOO, nobody keeps the ole Captain informed!)


Remember Democrats, keep telling yourself "deficits don't matter."

When lefties start businesses.

Mr. Muir gives me a hat tip.

New podcast on the Podcast Roll.

Like father like daughter. Don't ever tell me that race whore represents black people.

Saturday, May 16, 2015

But Is Mad Max Fury Road Feminist?

Naturally you all know about the international hubbub I caused by daring to say,

"I don't want to watch a movie that has a feminist lecture in it."

However, no matter how much cursing and swearing and calling me an international professional misogynist occurs, it doesn't moot the question - Is Mad Max Fury Road what I feared it would be?   A feminist film?

I have a couple buddies who are going to see the movie, but I know some of you have as well.  So for those of us on the fence (or just curious as to whether I was right and called this one like I did the housing bubble) please report back in the comments section below.

Wednesday, May 13, 2015

Why Entrepreneurship May Be the Only Feasible Retirement Plan

I had faced a problem.
For the first time in a while, the ole Captain had enough money saved up that he could start thinking about throwing some money in the ole IRA.

You might at first think this is not a problem.  But it is, young aspiring economist.  It is.  For the problem facing anybody under 65 who still has a bit of life expectancy left is:

Precisely what do you invest your money in?

All of you know my general concern that money coming from:

1.  Retirement dollars of baby boomers and Gen X
2.  Quantitative easing money being injected into the financial markets and
3.  Low interest rates prompting a trillion dollars worth of buy backs

is jacking up stock and other asset prices that there's effectively no good deals out there.

The PE ratio shows the stock market overvalued by almost half:

This results in a dividend yield of LESS THAN 2%

Housing only pays a whopping 4% today (and that's if you don't consider repairs and expenses)

And even an investment like education increasingly fails to generate the returns necessary to validate it.

Alas, today's investor is faced with the following effective REAL rates of return:

Stocks 0%
Savings -1%
Real Estate 2-3%
Education - HA HA HA HA HA!!!!!

Now naturally, many of you are saying,

"Wait!  0%???  The stock market has been booming!!!  How do you get 0%?"

Well, inquiring young mind, I'll tell you.

You see, there is no such thing as capital gains.  The real rate of return stocks (or any other investment for that matter) provides is the income or profit is generates.

Housing generates rents
Bond generate interest
And stocks generate dividends

However, ever since we thought it'd be a grand idea to designate stocks, bonds and other marketable securities as the default investments for our IRA's and 401k's back in 1978, stocks have gone up NOT based on their profitability, but by simply how many trillions of dollars-worth of mindless sheeple's money they throw into their 401k's accounts every paycheck.

Microsoft hasn't paid a dividend since it's existence?
Screw it, buy more.  The price might go up!

The S&P pays less than a Kaazaa account?
Screw it, buy more!  The price might go up!

Tinder or Twitter don't generate income at all!!!???
Screw it, buy more!  The price might go up!  IT'S AN IPO!!!

And so why we see the above ABYSMAL and PETTY REAL rates of return for the various asset classes.

So where precisely is somebody who demands an adequate rate of return to invest their money?

Sadly, it looks like entrepreneurship may be the only place to go.

It wasn't until I was having a conversation with my dad while running did I notice that even with all the tax benefits and government incentives to invest in IRA's and 401k's, the best use of my money is sadly to reinvest it in my various ventures.

If I drop $500 advertising my books on the Tom Leykis Show, I on average double my money. 
If I drop $100 advertising Asshole Consulting on Viva la Manosphere, I get about a 60% rate of return.
And if I drop $200 running ads on Marginal Revolution for my books, I get about a 70% rate of return.

Naturally of course, I don't enjoy any of the tax benefits on these investments that come with the government ordained IRA's and 401k's.

But so what?  Even adjusting for taxes, investing in your own private ventures generates MUCH higher rates of return than the government approved investments for your retirement account.

Tom Leykis post tax rate of return = 75%
Stocks (still) = 0%

Viva La Manosphere post tax rate of return = 45%
Bonds = 1.2%

Marginal Revolution post tax rate of return = 50%
Real estate = (post property taxes, repairs, insurance, etc.) -5%

Now naturally key to all of this is to get a product or a business in place where expending such money on advertising, equipment, etc., would generate such returns.  And I will be the first to admit that that is not easy.  For every successful business I have, I have at least 2-3 that have failed, and that says nothing of the labor put into researching, trying and deploying these ideas.  But all those drawbacks aside, returns are so non-existent in today's financial markets, you may not have a choice.  It is a mathematical impossibility to rely on today's conventional retirement planning tenet of "compounding rates of return" when those rates are effectively at or near 0%.  Ergo, it practically behooves you to have your hand at entrepreneurship and see if you can't make up your retirement from scratch.

Of course, most people will point out and say, "Not everybody can be entrepreneurs!  If we all became entrepreneurs there'd be no workers or economy!"

Thankfully, nowhere near "everybody" reads Captain Capitalism.

Now if you'll excuse me, I'm going to go and work on my next business idea.

My Response to the "Fury" Over "Mad Max: Feminist Road"

If you didn't know, a piece I wrote at ROK went viral and now I am of course being accused being a misogynist, woman hater simply because I refused to see Mad Max: Fury Road in fear of receiving yet another unwanted feminist or social justice lecture from Hollywood.  Instead of answering all the requests for interviews (which no doubt would be butchered), I'm simply putting this video up as my official response to the media  

However, despite the hubbub and drama, I am rapidly being proven right.  The movie is increasingly looking like a feminist film, and so to (if you'll forgive the term) "raise awareness" to this fact I started a hashtag on twitter that I hope catches on. #madmaxfeministroad  Hopefully, (unless the movie proves otherwise) we can save a lot of people a lot of money and a lot of time, and again, I am more than happy to watch the movie if it proves NOT to have a lecture on feminism or SJWing, etc. in it.

(I might also add that this is how you handle the liberal media, in case any spineless conservative politicians needed a couple pointers.)

Some Damn Fine Economics Work

Steve Sailer does some damn fine work indeed.

Tuesday, May 12, 2015

Hiring Writers

Howdy All,

Alex over at Academic Composition is hiring writers.  It's a great way to work on a beach in Thailand or traveling Europe while making decent coin.  Here are the details:

1. Considerable experience writing college papers. While a college degree
is not necessary, I'll need some evidence that they are capable of doing
quality academic work.
2. Ability to write over 50 pages per week on any subject other than STEM.
3. Willingness to thoroughly with all of the professor's requirements.

What's in it for the writer?

1. Minimal compensation: $10 per page, but my full-time writers generally
earn between $600 and $700 per week.
2. Flexible work hours, no rigid schedule. All it matters is that you
complete all of the work you take on. Yes, I would prefer to have a writer
who outputs 50 pages per week, but quality writers are hard to find. Hence,
I am willing to work with anyone who does good work on time.
3. Prospects for a higher pay-out. Full-time writers have been the pivotal
factor behind the recent growth of Academic Composition. Hence, it is very
likely that my per page rate compensatory rate will soon increase.
4. Managerial responsibilities. Full-time writers can procure additional
compensation by managing part-timers.

Aleksey Bashtavenko
Academic Composition
Owner & Principal Writer
(540) 300-1253

Episode #94 of The Clarey Podcast is Out!

Beard hairs caught in chest hairs
Independent contractor is superior to being an employee
Silver Dollar Bikini and why it means conservatives have better sex lives
Kanye West and American college students deserve each other
St. Louis Park wants to ban plastic bags

and MORE in THIS EPISODE of The Clarey Podcast!

Monday, May 11, 2015

Monday Night Linkage

You're putting the cart before the horse.  You have replaced men with government.  Men now have no agency in the real world, so they will seek it in a digital world.

An older man gives a younger girl some advice...and she actually listens!

Matt Forney interviews a girl about living in Chicago.  She inevitably gets to the point.

Putin, the privatization of Soviet assets in the 1990's, the oligarchs, and how it's the west to blame.

Department of HHS defines fathers to include "men living with your mom."  Heaven help us.

"Special needs" is the new vehicle by which a whole new victim class will be forming.

Mad Max: Feminist Road

But let us be clear. This is the vehicle by which they are guaranteed to force a lecture on feminism down your throat. This is the Trojan Horse feminists and Hollywood leftists will use to (vainly) insist on the trope women are equal to men in all things, including physique, strength, and logic. And this is the subterfuge they will use to blur the lines between masculinity and femininity, further ruining women for men, and men for women.

from my latest piece at ROK.

Sunday, May 10, 2015

What Precisely Is Quantitative Easing?

Well this!

"In the Hands of 16 Year Olds Everywhere"

Yes, yes, I do sound like Randall from "Clerks"

From an Amazon review of Bachelor Pad Economics:

This book is one of the most practical life guides that I've had the privilege to read. Aaron Clary does not mince words, and I love that he addresses the idea that having kids is a CHOICE, not a necessity. He gets really gritty and if you're overly sensitive he just may ruffle your feathers. Literally every aspect of life is covered, from worthless degrees to the decline of western civilization. He is a true man in a wilderness of wildly feminine life advice. His podcast is amazing, as well, so I'd highly advise that you check it out. He sounds like Randal from Clerks and he is just as hilarious, but also mixes in solid economics and live advice. 10 thumbs up. If this book could be placed in the hands of 16 year olds everywhere, civilization might have a chance to survive.