Kuta Beach

Kuta Beach

Monday, 23 August 2010

Suspicious of Undercover Boss

I have watched a few episodes of Undercover Boss and I am very suspicious of the show. The basic premise of the show is that the CEO goes undercover as an entry-level worker on the front lines of the job to see how it is run.

Some people have expressed skepticism over how genuine it is since the undercover CEO walks around with camera crew, which would make workers suspicious. However, the show explains this by claiming that the workers are all told that the cameras are there because they are recording for a show about an entry-level worker.

The main issue that I have with this show is that every single worker you see happens to be a saint and they always seem to work hard and then right on cue they always tell a sob story about how tough their life is. Then predictably at the end these poor workers are rewarded for their hard work by the kind CEO. Is it just a coincidence that just about every single worker the CEO comes into contact with has a sob story? I think that many of the workers who come into contact with the undercover CEO actually know that he or she is the CEO and they pitch their sob story with the hope of striking it rich. Another explanation is that the show is rigged and the undercover CEO is led towards workers who are filtered initially to make sure they have an interesting sob story.

Further Reading: Undercover Boss is the Most Rigged Reality Show I Have Ever Seen (WrestleZone Forums)

Saturday, 21 August 2010

The Problem with Election Betting Market Predictions

The betting markets predict a win for Julia Gillard in the 2010 Australian Federal Election (see Punters Back Gillard Victory). Some people believe that betting markets are very accurate predictors of elections, but I am skeptical.

I know of many people who have put large sums of money on Labor to win. These people are people who do not want Labor to win but bet for them so that their sorrows if Labor wins can be compensated for with cash.

The Labor Party may have certain policies that are unpopular for wealthy people, e.g. the mining tax. Wealthy miners who do not want Labor to win may hedge their bets by betting big for Labor. If Labor wins, they win big money from gambling. If Labor loses, they make big money from mining. This would then skew the betting market so that it predicts a Labor victory.

Australian Federal Election 2010

This year's federal election is between Julia Gillard and Tony Abbott. Julia has a background in socialist politics and is a former union lawyer. This is typical of what you would expect from a Labor Party condidate. Tony Abbott is a devout Catholic and one of the chief architects of the controversial WorkChoices policy. Tony is pretty much the type of candidate you'd expect from the Liberal Party.

The major problem is that even though these candidates have very different backgrounds, their stated policies during this election campaign are virtually identical other than perhaps Labor's promise to build the National Broadband Network.

Julia Gillard's knifing of Kevin Rudd as well as her opposition to pension rises one minute and then support of it the next minute, clearly shows that she is a shady character who cannot be trusted. Unfortunately, she is running against Tony Abbott, who is just as bad. Tony was a rabid anti-woman religious radical who and, as mentioned, a chief architect of WorkChoice. All of a sudden, he portrays himself as a loving family man and has completely backflipped on WorkChoices.

When the candidates for prime minister are both quite poor, one can only look at the histories of the parties to make judgments. The left-wing Australian Labor Party (ALP) has traditionally been the party that represents the interest of workers and has its history in the trade unions. The ALP's opposition to WorkChoice therefore is very credible. The right-wing is a coalition between the Liberal Party and the National Party. The Liberal Party has traditionally been the party that represents the interests of business owners. It is the party of choice, flexibility, entrepreneurship, and so forth. The National Party represents the interests of farmers.

In terms of my economic self-interest, it makes sense for me to vote for Labor since I am neither a business owner nor a farmer. I am a worker just like most people. It would make no sense therefore for me to vote against my own economic self-interest. Of course, without business owners there would be no employment and hence no workers, so there needs to be a limit to how much you can tax businesses. Even those working in government need business since government exists because of taxes on business profits (or income or consumption, all of which are products of business profits). Business profits are essential for everyone, not just the business owners themselves but also the workers and governments that share in the profits.

But this labour versus capital view of the political parties may not be accurate because the major parties nowadays are starting to mix into each other. The Liberal Party is promising a massive paid parents leave scheme that will be funded by a massive increase in company tax rates. Labor is promising the same thing except under Labor's scheme the business will pay for it whereas for Liberals the government will pay for it. Either way the effect is the same since government profits come from business profits via taxation.

Monday, 16 August 2010

Mosque Near Ground Zero

There are plans to build a mosque near the site where the World Trade Center collapsed during the Septermber 11 terrorist attacks.

According to the article Obama Denies Backing Ground Zero Mosque in The Age, President Obama one moment supported the idea but then toned down his support of the proposal.

I would have thought that the American Constitution supports freedom of religion and therefore building a mosque would not be a problem. However, the article claims that some Republicans have "described the plan as an affront to the families of victims of the September 2001 terror attacks." The article also says the following: "New York Republican Congressman Peter King accused Mr Obama of caving in to political correctness."

This comments about political correctness makes no sense. Political correctness refers to altering language or behavior in order to not offend others. In other words, it refers to politicians not being frank and honest but rather pandering to the norms and values of the public or the masses. Since about 70 per cent of Americans are against building this mosque, being for it is therefore politically incorrect, which I suspect is the reason why Obama toned down his support.

The terrorist attacks during September 11 were an attack on American values such as freedom of religion. To then ban the building of a mosque and therefore to deny freedom of religion is to go against American values. By banning the mosque you are effectively spitting on the American Constitution, behavior which would be very insensitive in light of the terrorist attacks.

Of course, this line of reasoning is what I would expect from a normal and reasonable person. But I am not naive and understand the political reality, which is that many people have prejudices and believe that the religion of Islam as a whole is responsible for the September 11 terrorist attacks. It is in my opinion unreasonable to hold this opinion. Within all large religions there are factions that are extreme and violent and there are factions that are moderate and humble. Among Jews there are the militant Jews (e.g. Jewish Defense League) and there are the moderate reform Jews. Among Christians there are the extremist Westboro Baptist Church (godhatesfags.org) versus the moderate Catholic church. The same applies with Islam. There is the extreme and violent terrorist organization that is Al-Queda and then there is mainstream Islam. Some argue that a quick reading of the Islamic sacred scripture (the Koran) reveals text that incite violence, mysoginy, and so forth. This may be true, but the sacred scriptures were written during different times when different values applied, so women were seen as subordinate. We see extreme elements in not only the Koran but also the Bible and even the Jewish sacred scriptures of the Torah and the Talmud. The Bible is homophobic, mysoginistic, and even calls for disobedient children to be stoned to death. But how many Christians actually do this?

Wednesday, 4 August 2010

Exchange Traded Residential Real Estate Fund

According to the article Class Divide: Property vs Shares, in 2011 (next year) there will be a security that you can buy on the ASX that will allow you to track Sydney house prices.

"Whether people want to hedge their own exposure, or start their kids investing in an index that will keep up with property prices, it would work the same, " he says. Joye says this listed product should arrive on the ASX next year.

"We're working with the ASX to list a security that covers an index of Sydney housing, which will give investors exposure to the performance of residential real estate but, more importantly, will give them the low volatility of the index.

The Alpha Strategy

I have just finished reading The Alpha Strategy, which is a book that I simply downloaded off the internet (see the link earlier) and put onto my mobile phone using a free software called EBookMe. In other words, I paid nothing to read this book. I think there is no need to pay money to buy a book because ebook programs like EBookMe are free and there are virtually infinite free books out there on the internet that you can easily find.

The Alpha Strategy is a good book. It is about the problem of inflation and what individuals can do to protect themselves from inflation. This books pretty much claims that a good way to protect wealth from inflation is to stock up on goods, e.g. toilet paper, wine, honey, and so forth. The ideal is that you stock up on goods that you will need anyway so that it won't matter if the price of these goods go up. If this is not possible e.g. because it is difficult to store wine, etc, then the next best move is to stock up on raw commodities like copper. There is a whole section near the end of this book that explains how to buy copper from the futures market. This book was probably written during a time when there was no exchange traded commodities (ETCs) for sale.

I think stockpiling goods is a great idea, but the main problem is that a lot of what the author is explaining is just too difficult. It is very unrealistic for me to start stockpiling because I still live with my parents. If I were to start piling up toilet paper in my bedroom, my parents would not be happy. Because most goods deteriorate (e.g. wine may go off if exposed to too much light) then you have to be very careful about the storage conditions and you have to make sure everything is stored securely because of the threat of theft. It is all very difficult. While reading the book I got the feeling that this investment strategy of the author was just an excuse he was using to justify his love of shopping, e.g. he describes in detail different types of wine.

I think the author's stockpiling strategy is good and I definitely will think about using it, but I won't put all my wealth in stockpiled goods. I think putting, say, 10 per cent of your wealth in stockpiled goods is a good idea, e.g. I might stock up on some soap or some breath mints or tic tacs.