2017 – Page 3 – David Veksler

Laziness must be learned

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 in the level of effort or concentration.

I would argue that most caregivers in West systematically discourage kids from meaningful self-directed work until they become the average lazy adult. We invented concepts like “adolescence” as the label for the chronic disease we created by interfering with the natural development of children through forced schooling, the prohibition of child labor, limits on unsupervised outdoor play, etc.

Company scrip and other great ideas pushed out by employment regulations

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 on-demand, rather than workers paying for four years of education, and finding that only 1% is relevant to their job.

* We leave our homes empty all day while we go far away to the office. Why don’t we share our living and working spaces? Corporate campuses with serviced housing should have built-in housing. This would be common if school districts and zoning laws went away. Employees could save years of their lives by skipping the commute.

* Whatever happened to the company store? The IRS makes company scrip difficult to account for, but companies often share a common culture, and employees could save big by buying in bulk or sharing big purchases like cars, jets, and hot tubs.

What else would we see combined if the government got out of the way?

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

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 “out of the box economics.”

“Steal from the rich to give to the poor” is not economics, nor is it exactly an original idea. Currently, my total marginal tax rate (what I pay for any additional income earned) is 46%. The cap on social security taxes is one of the few motivations I have to take on additional projects in order to raise my income. A 12% increase in my marginal tax rate would push my rate to 58%.

Why should I work my butt off every day to keep 42% of my income so I can pay for people who haven’t contributed a penny towards their own retirement?

How FEE.org gets 30,000 free monthly clicks with Dynamic Search Ads

FEE.org gets about 30,000 clicks from our primary Google AdWords account per month. This is not a lot of traffic – about one day of organic visitors – but the vast majority of Google traffic comes from new users, so it is an important source of new users.

The best part is that this traffic is totally free: FEE get’s a $40,000 per month AdWords credit from Google’s Grants program. That’s $480,000 of free advertising per year!

There are some catches you should be aware of:

A maximum cost-per-click limit of $2.00
Only text ad campaigns are supported
Your ads show below those of paying advertisers
A daily spend limit of 1/30th of your monthly total

In practice, these conditions make it difficult to hit your daily spend limit. Even if you do hit your limit (for example, by targeting hundreds of low-traffic keywords), it can be difficult to send your visitors to fresh content because someone has to keep creating new ads for new articles on your site.

Google AdWords offers an ingenious solution to this challenge: Dynamic Search Ads. This campaign type uses Google Search’s index of your site to automatically create ads matching the keywords that people are searching for. It’s as if someone creates a new ad every time new content is posted on your site! Using Dynamic Search, FEE.org is able to spend about 50% of our $40K budget on ads that send people to the latest FEE.org articles.

How learning to hurt people helped me deal with chronic stress

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. I reached over to the horn as I usually would, but before I could press it, an inner voice said: “this is not important.” The emotion was gone and I didn’t care anymore. This has happened a number of times recently.

Do you know someone who is perpetually worried about a million different problems, who feels like they just can’t get a break in life, who complains about how their relationship, work, or health is always falling apart? I bet it’s been a long time since they felt that single-minded focus and passion towards a goal.

Short bursts of high levels of physical and mental stress are a crucial ingredient for humans. In today’s culture, many people resort to media as a substitute for mental exercise and aerobic activity as a substitute for physical exercise. However, neither works properly on its own. The substitution of periodic high-level physical-mental stress with chronic low-level emotional stress in our culture contributes to high levels of stress-induced chronic physical and mental health problems.

How FEE uses Facebook audience sharing to maximize engagement

As social media has become the primary way for young people to discover brands and ideas, the effectiveness of traditional television/print/radio has fallen. Reaching people interested in your ideas on social media is hard — there are so many competing brands vying for their attention. Remarketing (aka retargeting) to audiences known to have an interest or relationship with you is one of the most effective ways to reach people who are most likely to engage with your brand.

While FEE’s marketing has historically been focused on personal referrals and “organic” growth, in 2016, we decided to focus on reaching new audiences and developing new marketing channels. Key to our plan is reaching new audiences on social media, using some tricks used by top ad agencies that are new to the nonprofit world. Typically, when organizations run ad campaigns – whether web, print, or radio – they target broad demographics. What FEE has been doing with great success is targeting individual people.

We use email lists and website retargeting data (including visitors to FEE.org and partner sites) to target people on social media who have already expressed some interest in liberty ideas. In other words, we match our visitors’ browsing behavior to their Facebook profiles, and show content targeted specifically to them. This gives us very high click-through rates compared to targeting broad demographics, resulting in costs as low as 2 cents per click.

If you are interested in reaching young people who care about free markets and liberty, would you consider trading Facebook audiences with FEE?

I’m not asking for your audience’s email or any personally identifiable information. Custom audiences are the aggregate collection of social media profiles which can be used to show Facebook posts and ads to individual users based on emails or website activity. This data is created by creating a custom audience in Facebook from an email list and/or adding a tracking code to your site. We would be sharing Custom Audiences as described by Facebook here.

Why would you want to share Facebook audiences?

It doesn’t cost you anything, and your audience is never individually identified.
You can share both email list (FEE has 100K active emails) and web audiences (about 700K Facebook users per month.)

How to get started:

If you already have targeting data via Facebook custom audiences and are ready to share it, we can exchange email and web audiences immediately. FEE’s account ID is 25217845.
If you want to proceed with sharing custom audiences but don’t know how to get started, get in touch with me and my team will guide you.
If you want to know how custom audiences and retargeting works, I can share some resources with you.
Feel free to reach out to me if you are interested in a general discussion of how FEE has grown traffic 3X in two years and 2X within the past year using innovative remarketing strategies.

P.S. In addition to sharing audiences, we also share content, with video cross-posting.

Introduction to Modern Portfolio Theory

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 explain the basic idea of MPT with a simple example:

Suppose you want to start investing with $100. You could choose to put all $100 in Apple’s stock. Your portfolio will then depend entirely on how Apple performs in the future. It’s done great in the past, so it might continue to gain value, or the iPhone 8 might be a disaster, and you will lose everything. Investing in any single company is a high-risk investment because you’re putting all your eggs in one basket.

If you wanted a safer portfolio, you could put $50 into Apple and $50 into Amazon. Now you have a similar expected return, but much less risk. However, the fortunes of Apple and Amazon are still highly correlated because they are both tech stocks, and they tend to move up and down together. If the tech market crashes, you will still lose a lot of money.

What you could do is put half your money into Exxon, which is less likely to match the performance of tech stocks, and so will provide similar returns with a lot less risk. You could take this strategy further and split your $100 into 25 different stocks in all kind of sectors such as industrials, healthcare, and utilities, and include some international stocks as well. You might put some of your money into bonds, which are much safer (you only lose your money if the company or government goes bankrupt), but provide a lower return.

Here’s the key insight of MPT: you can graph all possible allocations of a set of investments on an efficient frontier: a line (actually a hyperbola) which represents a combination of investments that has the least risk for a given level of return. From a safe 100% bonds portfolio to a risky 100% stock portfolio, every point on the frontier represents the highest return for a given level of risk. The degree of risk you’re willing to tolerate depends on your personal preference, but you should always try to maximize your return for whatever risk tolerance you choose. You achieve that by having a well-diversified portfolio where no single asset represents more then 4% of the total, and the correlation between assets is minimized.

Here is another insight of MPT: you can often lower your risk with a small degree of diversification. By putting 25% of a portfolio into international stocks, a little in alternatives such as real estate, and a little in bonds, you greatly lower the risk, with only a slight decrease in the expected return.

Below, I show you exactly what this looks like for my portfolio.

The catch is that the efficient frontier is based entirely on historical performance, so if the market behaves dramatically different than it has in the last 100+ years, your assumptions won’t hold true. Furthermore, it is not a set-it-and-forget-it approach: you must continually update the model based on market performance and re-balance your portfolio to keep the ideal asset allocation. This is a lot of work! In fact, it’s more work than the average investor is capable of, which is why I don’t recommend that individual investors buy individual stocks. Instead, you should either buy a few ETFs which represent entire markets, or let a robo-trader do it for you. The ETF approach could consist of just three securities: a domestic market ETF, an international market, and a bond ETF. A robo-advisor would do the same thing, only more efficiently (so less risk, lower taxes, and potentially higher returns), but for a small fee. (I use Personal Capital, but Betterment.com is cheaper for new investors.)

Here’s what an efficient portfolio looks like for me. If you own stocks or a 401K, etc, I suggest you sign up for the the free Personal Capital app, so you can see whether your portfolio is efficient.

What is FEE’s digital marketing strategy?

FEE’s mission is ultimately one of marketing. FEE does not do basic research or write academic treatises. We do not contribute to academic journals or conduct economic research. The intellectual foundation in support of a free society and sound economic principles is well established and our partner organizations do a great job of building on it. FEE’s mission is to popularize a set of ideas: the values of a free market and individual liberty. We must make effective marketing a core competency of FEE.

Strategy

Our marketing strategy has three elements:

Create great content that engages, informs, persuades, and delights users.
Distribute our content using the platforms that young people use.
Accelerate our audience’s engagement with the liberty movement by promoting events, online courses, and program partners.

Core Competencies

In order to further this mission, FEE is developing a world-class technology and marketing platform based on the practices and tools used by top marketing agencies:

Inbound marketing: we leverage our vast catalog of articles, books, and media in new formats to draw audiences to our site and create more opportunities to create customers. We have developed the capability for cost-effective social media advertising that pushes our content to audiences proven to best respond to our message.

Marketing automation: using tools such as HubSpot, we are building an automated conversion funnel, which automates personalized messaging workflows. We infer our visitor’s goals based on their behavior, then send them personalized messaging. For example, we capture visitors who are interested in events but have not applied, and keep them up informed about our programs.

Targeted messaging with data science: tools such as Parse.ly analyze all our content as well as the behavior of visitors to FEE.org. We use data science analysis to create a personalized experience for each visitor to FEE.org. Additionally, our editors see real-time feedback on how their content performs with each audience.

The goal of FEE’s marketing efforts is to be the most effective advocate of liberty ideas in the world, offer a compelling alternative to anti-market orthodoxy, and develop effective pathways to a deeper and life long commitment to the liberty movement.

How to prepare your life for the Technological Singularity

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 waiting to be obsoleted by AI or entrepreneurs.

The majority of the legacy workforce will gradually discover that their technical expertise is irrelevant and spend the rest of their lives living on welfare and consuming media – probably playing nostalgic games in a holodeck or having virtual orgies. While many people would not have a problem with such a lifestyle, given that I don’t have a TV or a Netflix account, I would rather develop skills that require higher-level skills. Rapid technological change, automation, and on-demand, on-site manufacturing will make highly specialized roles obsolete. Future-proofed workers will need to develop a high-level understanding of research, creative, technology, and marketing, while algorithms work out the details.

Personal Finance:
There are two likely possibilities: either pre-singularity differences in material wealth will be nullified (because the AI’s eat us, or standardize our resource utilization), or they will be dramatically amplified, as the value of capital goods increases exponentially.

Rapid technological progress will make predicting successful companies and sector impossible as billion dollar startups rise and fall overnight. Therefore, a highly diversified, international (intergalactic?) portfolio may offer the safest returns. If existing property claims survive, they may be magnified a million fold or more, so $1000 may become a million, and even modest portfolios may be worth a few star systems.

Furthermore, technology-independent resources such as land and broad ETFs will be more stable than fixed capital assets such as cars, houses, currencies, precious metals, etc. How can we know what assets are still relevant when the economy transitions to new paradigm every night? That will require a degree of social adaptability:

Social Adaptability:
Rapid shifts in technology will enable rapid cultural evolution. New fashion trends will drive demand for new products and technological sectors, just as the invention of the smartphone created new markets and changes work and leisure in the last 10 years.
When most humans are freed up from the need to work, the economic and cultural focus will shift to leisure goods and new kinds of entrepreneurial activity (asteroid mining, undersea colonies, etc). It will be increasingly difficult and yet crucial to stay aware of the cultural trends.

Furthermore, constraints such as ethnicity, gender, sexuality, species, consciousness etc, will become increasingly fluid and amorphous. We’ll need to become tolerant of and respectful of lifestyle and identify choices that we cannot imagine today. Today’s culture wars over transgender people will seem laughable when it will be trivial to change one’s sex overnight, and then back again. We’ll be much more concerned with questions of identity and ethics raised by uploaded, cloned, and synthetic beings. Will our base-human bodies remain relevant in such a world?

Health:
As the singularity approaches, traditional medical treatment paradigms will be overtaken by new ones:
first: personalized medicine based on test automation and DNA profiles,
second: nanotechnology and synthetic biology (such as stem-cell) treatments, and finally,
third: large-scale bioengineering (growing organs and bodies ex-vivo) and/or mind uploading.
The focus will shift from medicine that treats problems to bioengineering existing and new humans in order to improve on nature.

These changes already face fierce resistance from our monopolistic social-political structures. It will up to you to take charge of your biological evolution. For example, because the US government prohibits companies like 23andme from informing customers about the full health implications of their DNA, I exported the raw DNA data for my family and analyzed it using Promethease to get our risk profiles using the latest research. (I also a found a relative from my birth county in Ukraine.)
I spent a month in Thailand getting medical treatments which would have been prohibitively expensive in the USA. In 2010, rather than rely on the medical monopoly’s recommendations, we adopted a low-carb, Paleolithic-style diet and dramatically improved our health.

If you want to take advantage of radical new health innovations, you will need to perform your own research on radical opportunity for both repairing and augmenting your biology.

How to enable cross-posting videos with FEE on Facebook

Cross-posting videos allows sharing Facebook Videos between Pages without re-uploading a duplicate video.

Why would you want to cross-post with FEE?

Your videos get more exposure on other Pages
You control the content and description of the video (unlike re-uploaded videos, cross-posted videos cannot be modified.)
Analytics/Insights are shared with both the author and the page cross-posting the video.
FEE has a $2 million grant to distribute great content, and we are very, very good at distribution!

Tutorial: How do I allow another Page to crosspost my Page’s videos?

Step 1: Click on the Settings for your Pages, then Crossposting. Now add FEE:

Step 2: Go to “Publishing Tools” then “Video Library” then Edit for each video you want to share:

Step 3: Enable cross-posting for each video you want to share with other pages: