How to Peel a Head of Garlic in Less Than 10 Seconds

How to Brick a $100K+ Fisker Karma

According to Consumer Reports:

Our Fisker Karma cost us $107,850. It is super sleek, high-tech—and now it’s broken.

We have owned our car for just a few days; it has less than 200 miles on its odometer. While doing speedometer calibration runs on our test track (a procedure we do for every test car before putting it in service by driving the car at a constant 65 mph between two measured points), the dashboard flashed a message and sounded a “bing“ showing a major fault. Our technician got the car off the track and put it into Park to go through the owner’s manual to interpret the warning. At that point, the transmission went into Neutral and wouldn’t engage any gear through its electronic shifter except Park and Neutral.

We let the car sit for about an hour and restarted it. We could now engage Drive and the same error message disappeared. After moving it only a few feet the error message reappeared and when we tried to engage Reverse the transmission went straight to Park and again no motion gear could be engaged. After calling the dealer, which is about 100 miles away, they promptly sent a flatbed tow truck to haul away the disabled Fisker.

 We buy about 80 cars a year and this is the first time in memory that we have had a car that is undriveable before it has finished our check-in process.

The taxpayers are only into this company to the tune of $528.7 Million through the Stephen Chu Hedge Fund Venture Capital Fund at the Department of Energy.

Reasons to Buy a Chevy Volt

Chevy Volt - Building a Better Tomorrow from Ben Howe on Vimeo.

As Richard Prior said, "when you are running down the street with your hair on fire, people will get out of your way."

But in all seriousness, this is yet another tax break for the top 10% (if they choose to buy such a toy) at the expense of the 90% to subsidize a product that could not succeed in the free market. Not many people can afford to pay $40-50K for a car that only has a range of 30 miles and might burn the house down if they park it in their garage.

A Civics Lesson About the Forms of Government

The Grouch's Millionaire Secrets

“Earnings are only a means to an end, and the means should not be mistaken for the end. Therefore, we must say that a stock derives its value from its dividend, not its earnings. In short, a stock is worth only what you can get out of it. Even so spoke the old farmer to his son: A cow for her milk/ A hen for her eggs/ And a stock, by heck/ For her dividends.”

~ John Burr Williams, “The Theory of Investment Value” (1938)

Many books have been written over the years on how to become a millionaire. Some are based on sound business and investment principals while others are based on the latest fad of the moment. But you don't need to waste your money on these types of books (invest it instead). In the simple world of the Grouch, they can all be boiled down into a handful of key items that can fit on a single sheet of paper.

1. A million bucks ain't what it used to be. The younger you are, the more money you will need to live independently. You should set your goals higher, probably somewhere in the 3 - 5M range, before telling your current boss goodbye for good.

2. Your house is not an investment. It is a place to live. The days of massive real estate gains are over. Long term house price tend to move in line with inflation. The current correction in real estate is a reversion to the long term trend line. Until we have a good dose of inflation and higher employment rates, don't expect to see prices rise significantly.

3. Gold is not an investment. At best, gold is an insurance policy against fear. Gold has no fundamentals, no earnings, no cash flow, no dividends or interest. Its price is determined by supply and demand, and most of all by fear. In troubled times, its price will move higher as stocks move lower. In good times, its price will tend to drift lower.

4. Invest early and often. Let the power of compounding work for you and be happy with the 7 - 12% average gains of the market over the long term. Compounding is a magical thing that can turn small sums of money into large sums of money.

5. Choose low cost investments. Cost are subject to the laws of negative compounding. A 2% expense ratio is a tough hurdle to overcome year after year. Even the most talented stockpickers must take extra risk to beat the market. An index with an expense ratio of .07% is much more likely outperform a fund with an expense ratio north of 2%. It does happened, but it is usually luck rather than skill that lands a person in these fortunate funds. Odds are not in an investors favor with high expenses. Why buy yachts for your broker or fund manager instead of yourself?

6. Stay away from today's hot hand and pick managers based on investment philosophy, or invest your own money. Statistically, value investing produces higher returns over the long-haul as compared to growth investing. Chasing performance only works occasionally, and usually results in permanent loss of capital. Pick managers that apply a consistent discipline to their investments and only buy assets that they believe are selling for cents on the dollar.

7. Be a contrarian. The best deals are to be found in what investors are currently shunning. Major stock market corrections like in 2008 and 2009 are a prime example of this. But it is hard to control the emotions and be rational when fear is so thick in the air you can almost cut it with a knife. So do your homework and make sure the current problems with a business or security aren’t of a permanent or fatal nature.

8. Be frugal. Live well below your means. Make bargain-finding a lifestyle. Be a coupon-clipper at the grocery store, and put at least 100K miles on your cars.

9. Use demographics in your favor. Observe the world around you with fresh eyes every day. See where the population trends are heading and invest in these areas prior to discovering trends with the masses from Money Magazine, Kiplingers or Smart Money. By then, it is too late.

10. Look at everything with a skeptical eye. Try to poke hole in every investment thesis, and understand the potential downside of every investment before committing capital. This is more important than understanding the potential upside of investments.

11. Keep a balanced approach. Use some income assets to help you deal with portfolio volatility, and to provide stability in the bad times. But realize you will never get rich off of these type of investments. At best you will stay 1 or 2 percentage points ahead of inflation.

12. Invest in yourself. Always seek to grow your base of knowledge every chance you get, whether through formal or informal education. Reading books, youTube and blogs are a great source of knowledge as well as misinformation so you have to apply a filter to everything you experience to separate the wheat from the chaff.

13. Have fun. Life's an adventure. If you don’t enjoy compounding wealth, then by all means be like most people and live paycheck to paycheck. Buy whatever your heart desires, but don’t come boo-hooing to Uncle Sam that the taxpayers should fund your dream retirement. This isn't Greece. But for those who want to try something different, compounding wealth can be a lot of fun. Not just for misers, but for regular folks who may ultimately want to give it all away to their favorite cause, or just take care of their families.


Ok. So there’s nothing secret about anything in this list. It’s all just common sense, and if applied consistently throughout your life will make you very wealthy, much more than your friends who will be laughing at how cheap you are. It all comes down to what you want to do with your life. If being financially independent is important, these items can provide some general guidance. Each person will have to individually map out their course to wealth, but the principles are universal and timeless.

The Case for Optimism and Abundance

At TED2012, Peter Diamandis makes a case for optimism -- that we'll invent, innovate and create ways to solve the challenges that loom over us.  The last 100 years have been an absolutely incredible time to be alive.

Quote of the Day: Matt Ridley

The entire argument for green jobs is a version of Frederic Bastiat’s broken-window fallacy. The great nineteenth century French economist pointed out that breaking a window may provide work for the glazier, but takes work from the tailor, because the window owner has to postpone ordering a new suit because he has to pay for the window.

You will hear claims from Chris Huhne, the anti-energy secretary, and the green-greed brigade that trousers his subsidies for their wind and solar farms, about how many jobs they are creating in renewable energy. But since every one of these jobs is subsidised by higher electricity bills and extra taxes, the creation of those jobs is a cost to the rest of us. The anti-carbon and renewable agenda is not only killing jobs by closing steel mills, aluminium smelters and power stations, but preventing the creation of new jobs at hairdressers, restaurants and electricians by putting up their costs and taking money from their customers’ pockets.

We now have an estimate, from meticulous work in a new report by the Renewable Energy Foundation, of just how costly those subsidies are going to get in a few years’ time: £15bn a year, or 1 per cent of GDP. Ouch. That’s more than this year’s growth.

Contrast that with news from the United States that, according to a report from IHS Global Insight, the cheap shale gas revolution now in full flow has created 148,000 jobs directly within the gas industry and – by making energy cheaper – has created at least another 450,000 jobs elsewhere in the economy. By 2015, the total impact of shale gas will be 870,000 new jobs, says the report.

Shale gas now provides more than a quarter of American gas from a standing start about five years ago. Its effect has been dramatic. Whereas gas prices rose sharply here in the last two years, pushed up by oil prices, the Libyan civil war (which constricted supply) and the Japanese earthquake (which boosted demand), by contrast they stayed low in the United States.

~ Matt Ridley, from In America, the shale gas revolution is creating jobs and growth. It can here too

Grouch: Ridley is his usual brilliant self in this editorial. Here in America, I'd say the shale gas revolution is happening in spite of the politicians and the resulting lower prices are prompting many, many folks to convert from oil and propane heating over to natural gas. Our anti-Energy Secretary Stephen Chu has wasted billions of taxpayer dollars on green energy companies with political connections, many of which have gone bankrupt even with massive government loan guarantees. Let's hope the political insanity on both sides of the Atlantic will end soon.

drill, drill, drill = supply, supply, supply = low, low prices

The Best Buying Opportunity in a Generation for Investors?

Edelman Financial Services CEO Ric Edelman on why there are such great opportunities for investors right now in the markets.

Grouch: My love/hate relationship continues with Ric Edelmann. I believe he is one of the better and more consistent people in the financial planning industry, but the personality is sometimes a little too much for me. I do agree with the premise of his comments.