good neighbors

Today I heard my neighbors car alarm go off so I headed to a window. Then their other car’s alarm started going off too. Looking out the window, I could see both neighbors and their daughter, pushing buttons on their remotes to get the alarms to shut up.

Seizing the moment, I grabbed a broom and raced out the door towards them. While brandishing my broom high I screamed at them, “get away from my neighbors car.” Rhonda, their daughter, who had set off the first alarm was rendered utterly helpless. Apparently it’s much harder to dodge a broom waving maniac while busting a gut laughing. Who knew?

Smitty, upon hearing the first alarm, thought it was his car so he grabbed his keys and hit the alarm button to turn it off, which is why there was now two car alarms blaring. Rhonda had turned off the first alarm, but then Smitty’s started so she hit the alarm button again, turning it back on. I arrived in time to inject more confusion and transform it into a true comedy of errors.

Get them jollies while you can!

Financial Literacy

A Freakonomics Radio podcast I just listened to, Everything You Always Wanted to Know About Money (But Were Afraid to Ask), stated that studies have shown that in the USA and in nearly every other country studied, the percentage of people who are financially literate is under 30%. That’s the bad news.

The good news was Harold Pollack’s “all the financial advice you’ll ever need fits on an index card” conversation. I took notes:

  1. save 20% of your income
  2. pay off your credit card bill in full every month
  3. max out 401k & other tax advantaged accounts
    1. it reduces your tax burden today
    2. matching employer contributions are free money
  4. never buy or sell individual stocks
  5. buy inexpensive and well diversified index and ETF funds
  6. make your financial advisor adhere to the fiduciary standard
  7. buy a home when you’re financially ready
    1. homes are something we use and consume
    2. when are we ready?
      1. have 20% in hand
      2. fixed rate 15/30 year mortgage
      3. still have reserves for home maintenance
  8. insurance: be protected against losses > your reserves
    1. get the largest deductible
  9. do what you can to support the social safety net
    1. bad stuff happens
    2. lots of people need help

Solar ROI update

I now have a full year of electric production and consumption measured. I also have the SCL rate updates for 2017 and 2018 so I have updated my solar ROI estimates. The significant change is that the Net Metering benefit has substantially increased due to:

  1. SCL electric rates are higher in Shoreline than Seattle.
  2. The 2017 and 2018 rate increases are 5.6% (estimated at 4%)
  3. An added RSA surcharge of 1.5%
  4. The coldest winter in 32 years
  5. More electricity use than I predicted.
    • I was still insulating deep into the heating season.
    • I guesstimated the kWh it would require to heat a 1955 house with heat pumps.
    • I installed a fast (level 2) charger for our Leaf. We were able to use it more, offsetting gasoline with electricity.
  6. The increased usage is all at the higher 0.14¢ price tier.

Reasons 1-4 weren’t known during my initial estimates. Reasons 5 and 6 were planned but their scale was unknown. I knew I’d be removing all natural gas appliances (furnace, water heater, fireplace) but I hadn’t yet decided whether to install tankless electric or a heat pump water heater. I hadn’t chosen the heat pumps for house heat yet so I didn’t know their HSPF. I also didn’t know how much more we’d be able to use the Leaf.

The net result is that I now estimate a 100% return on the solar array in the 6th year instead of the 8th year.

Notes

  • I did not include the cost of the heat pumps or the heat pump water heater. Those were efficiency upgrades that I’d have done anyway. If I were keeping natural gas, I’d have replaced the old 80% furnace with a 97% modulating furnace and the “well past its expected lifespan” gas water heater with a gas tankless. In both cases the costs are comparable and just like replacing the fridge, the efficiency increases have their own ROI schedule.

April solar update

The coldest Puget Sound winter in decades is receding and with it the heat pumps heavy period of energy use. April showers are upon us, the sun is rising higher each passing week and solar output is crawling out of the winter basement. In the past week, the solar panels produced 75% of our household energy budget. It looks like we’ll be into “solar surplus” territory by the end of April.

Who’s Afraid of the TPP?

Who’s Afraid of the Trans-Pacific Partnership?

Very roughly speaking, DeLong’s argument is this: everyone agrees that Germany is the poster child for an advanced economy with a great manufacturing policy. And yet, their manufacturing employment has steadily declined for the past half century too, just like ours. So if this has happened to Germany, there’s not much of a case for suggesting that the US has done anything especially wrong over the past 50 years. We’ve simply evolved from a (relatively) poor manufacturing nation into a (relatively) rich services and technology nation. This has nothing much to do with trade policy, either. It’s just what rich countries do. What’s more, it’s a decidedly good thing overall, even if it does affect a smallish number of people badly.

This is not terribly different than agricultural employment. At the turn of the 20th century about half of US workers were employed in agriculture. A hundred years later as we skated past Y2K it is about 2%.

US manufacturing

The the USA is still one of the largest manufacturers in the world. Our manufacturing sector is producing as much today as it ever has:


source: tradingeconomics.com

While it’s true that some (a small fraction) US manufacturing jobs have moved overseas (especially textiles), the vast majority of manufacturing job losses are due to automation. It is machines that have taken those jobs, not foreigners or immigrants.

On balance, NAFTA was a very big win for the USA and our trading partners Canada and Mexico. The primary reason NAFTA hasn’t helped Mexico far more is due to our ill conceived and almost entirely ineffective war on drugs.

Is a change of political climate in the air?

On May 21st,  leaders representing 6.5 million companies in 130 countries called on policy makers to shift towards low-carbon economies including carbon pricing and an end to fossil-fuel subsidies.

Yesterday, June 1st,  Six oil and gas “Majors” called on the UN Convention on Climate Change to introduce carbon pricing and markets.

If this keeps up, Fox News will admit climate change is real, Rick Perry will admit that government can create jobs, and lions will lay down with lambs.