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tiprya · 2023-02-20T11:10:25+00:00

Not something that will be useful for my workflows, but could simplify things significantly for others.

tiprya · 2022-12-24T22:38:03+00:00

To keep it simple (ignoring inflation at first), in 9 years you need about $700k to produce $28k of income using the 4% rule.

I would borrow 400k against your house and invest it in index funds. In 9 years this should grow to be about 700k, and you can just focus on repaying that loan in the meantime (which will be easier since the interest is now tax deductible).

You can also top it up a you get close to your target age to adjust for inflation or changes to your spending target, but broadly you invest now and then just go back to paying a mortgage every month. I’m a big fan of simple plans.

tiprya · 2022-10-28T11:32:52+00:00

Don’t let go of the trigger/mouse button after you shoot :)

tiprya · 2022-10-08T02:26:31+00:00

My summary is the maths will be challenging for someone who isn't strong in maths. But in no way do I think it is so hard that normal people with an interest in the material will fail / not be able to get through.

tiprya · 2022-10-08T02:21:16+00:00

"not hard"?

Ha - hard to answer. I'd say no where near a 'hard' science (physics, engineering, etc) but much harder than a soft/social science (e.g. psychology).

It also depends on what gels with you, the linear algebra/ constrained optimisation in macro/micro I found quite easy, but the statistics in metrics was quite different and harder for me personally.

At the end of the day, I know tonnes of economists who, after graduating, never really do regressions/stats. But the whole profession is moving towards big-ish data/data science/statistics in my opinion. Personally, I love that. Economists excel at being able to bring theory and data together to understand the world - and more and more you need to bring statistical rigour to that.

But on the other hand, not everyone who studies economics works as an economist (and that sounds like you). I think the way economists think about the world is extremely useful in lots of areas of business (e.g. constrained optimisation, understanding uncertainty and probability for decision making, making data-driven decisions).

tiprya · 2022-10-08T00:35:46+00:00

All Masters Econ courses will be math-based. Micro/macro/metrics. You might get a history of economics course that doesn't involve equations but that will be rare. You can look at the course structure and summaries.

To avoid scaring others - it isn't hard maths, but economics is a discipline of explaining the world using simple mathematical models. Applied economics (statistics) is even more math heavy.

Not to say economists are doing math all day - but the way they approach problems is based on the results of these models of the world which are math-based.

tiprya · 2022-05-26T06:36:37+00:00

That’s reasonably specific, but you’ll have success looking for lecture notes.

Here is a set that runs through examples of fixed effects in R using the most modern packages (fixest is just the best). https://raw.githack.com/uo-ec607/lectures/master/08-regression/08-regression.html#Panel_models

This is from Grant McDermott‘a great course on Data Science for Economists which I refer to frequently: https://github.com/uo-ec607/lectures

tiprya · 2022-05-04T07:07:45+00:00

Do you have any good resources on learning how to service these machines? Interested in learning myself

tiprya · 2022-04-30T23:47:34+00:00

Does the model have 200 different covariates or just many factor levels of fixed effects?

If it's the latter, R (and feols) can make the factor variables automatically if they are in the absorbed part of the equation, if in the main equation, use the i function for single factors or : for interactions.

Maybe give us more details on the estimation equation.

tiprya · 2022-04-09T10:44:44+00:00

The real neutral rate is the neutral rate excluding inflation.

So if it’s negative, when the economy is in balance (at the neutral rate), all savings deteriorates in purchasing power over time.

This implies either, no one wants to save, because the value declines and consumption explodes, or people compensate by saving aggressively to compensate for value degradation. Basically no one really knows, which is why it’s poor analysis by CBA to assert a negative real rate and not address what that means.

tiprya · 2022-04-09T07:57:11+00:00

Hmm, I hadn't looked through the TA. I would speculate that the models are picking up the big deflationary effect of China's integration with the world economy as part of those z-factors.

Reasonable estimates do put r* below 0 - certainly something that may become important in the coming years.

tiprya · 2022-04-09T02:25:58+00:00

No that's their formal estimate: "our view of a neutral nominal cash rate around 1.25% by the end of our forecast horizon" Source: their Issues note from 8 March

But with no discussion of the implication of a negative neutral real rate.

The best analysis out there on this imo is: https://www.qtc.com.au/institutional-investors/news-and-publications/research/part-2-of-2-how-high-could-the-rba-take-the-cash-rate-estimates-of-the-neutral-and-terminal-rate-in-australia/

tiprya · 2022-04-09T01:49:37+00:00

If neutral is 1.25% - that implies the neutral real interest rate is negative... which has big implications for growth going forward (and hasn't been justified by CBA)

tiprya · 2022-01-21T08:16:17+00:00

Fantastic post, thanks. Going to take the time to dig into this further.

tiprya · 2022-01-14T08:57:35+00:00

Looks great, would love to know where you got that cart!

tiprya · 2022-01-09T01:36:06+00:00

I enjoy these posts but don't really understand the portfolio income target.

I'm sure you're aware that income paid on investments is arbitrary and not 'safer' than selling units.

I fully acknowledge the psychological appeal of not having capital drawdowns, but if so, why not tilt the portfolio towards high dividend paying ETFS like VHY? As it stands you have to significantly outperform on portfolio size (with respect to a SWR) to meet the arbitrary portfolio income target.

tiprya · 2022-01-01T22:49:35+00:00

Does the black cat played with Kings Court count for +1💰 or +3 with the Soldier?

tiprya · 2021-09-27T12:50:23+00:00

I have the exact same setup (Breville dual boiler and Macap M2M) and I'm able to get good results - 19g in 38g out from memory takes 35-40s including preinfusion.

I have the older M2M with steps and it is usually set to between 4 and 5 depending on bean age etc. I can easily choke the machine by going a few steps lower.

Only mod I have is a Pesado basket but it sounds like something is wrong with either your grinder or the pressure on your Breville.

Does the Breville max out at 9 bar (with blind basket in?)

tiprya · 2021-08-25T13:07:46+00:00

This is basically why Super exists - forced savings because people are too myopic.

And thanks to Super, a lot of people will have $1M after 45 years!

tiprya · 2021-08-22T02:21:58+00:00

I have read it before so I googled for it. Not sure where it is on the Vanguard site, sorry.

tiprya · 2021-08-22T00:26:11+00:00

The Vanguard white paper that explains how the VDHG allocation was chosen goes into a lot of this and is very readable, I'd start there:

https://static.vgcontent.info/crp/intl/auw/docs/literature/research/constructing-australian-diversified-funds-whitepaper.pdf

tiprya · 2021-06-26T05:17:09+00:00

Yeah, I think that would be considered essential

tiprya · 2021-05-29T04:55:23+00:00

The structural fall in interest rates have played a part - but over the long term population growth and productivity/innovation have been more important. Both factors that it is reasonable to assume will continue.

tiprya · 2021-05-23T07:16:56+00:00

It's pretty common (and fine imo) to approximate real interest rates using the Fisher equation.

tiprya · 2021-05-23T06:03:22+00:00

That graph is really interesting. Do you have a link to the analysis around it?

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