Sunday, July 24, 2016

House prices

Just imagine for a second that it was known that house prices would not increase for 10 years.  In Australia, that is almost unthinkable.

Now a lot of houses in Oz are bought as "investment properties".  They are rented out, and at some stage in the future they are sold, usually for a healthy profit.  Typically the rental income is small.  That is, if the investor borrowed the money to buy the house, then the rental income would be less than the interest payments on the loan.  Or, conversely, if the investor had the money to buy the house, but instead invested it in a term deposit, they'd make more money from the term deposit than the rent they would from renting the house.

No, the actual money is made when you sell the house for a lot more than what you bought it for.  But what if that capital gain vanished?

With no expected capital gain, you'd actually want to make money on the rent.  But then you'd need to charge around 50% higher rent.  But then people wouldn't rent your property.  So your investment doesn't make sense.  For it to have made sense, you'd need to have bought it for two thirds the price you paid.  And the same goes for all the other investors.  They are all sitting there, thinking that they need to sell because they are losing money.  So rents will fall, and investors will stop buying houses.  And that should make house prices fall.

And at this point, some renters should start to buy.  Because they were close to buying before, and with the fall in house prices, they can now afford to buy.  So investors are replaced by owner occupiers.

Anyway, this won't happen.  Australia takes a lot of migrants every year.  A lot.  And they all need houses.  And that means that any fall in prices is purely short term.  In the long term, house prices will keep rising, and investors will keep the prices higher than they really should be.

Friday, May 27, 2016

Carbon fibre furniture

We love our carbon fibre bikes - so light, yet so strong.  As someone who thinks that moving house once is one time too many, and that carrying heavy furniture is a right pain, I'm thinking that we need carbon fibre furniture.

A carbon fibre sofa where all the weight is in the cushions.  It might even need hooks onto which you attach weights to give it some gravitas.  A carbon fibre dining table that you can carry around on your shoulder.  Ditto for your carbon fibre desk and your carbon fibre cupboards (except that all wardrobes are built in these days).

Sunday, May 8, 2016

What should Labor do?

Australia votes for a new government in a few weeks.  The election has been called, and campaigning has started.  I'm a supporter of the Australian Labor Party (ALP).  So what should the ALP do?

In my mind it is quite simple.  When you look at the recent past and the probable future, there is a consistent theme of change:

  1. Big business and rich individuals refuse to pay tax.
  2. Continual technological improvements reduce the number of jobs available.
  3. Increasingly Australian workers are competing directly with overseas workers.  And this is driving down wages.

The Liberal Party (Australia's conservative party) responds to these changes as follows.  They recognise that their tax income is falling, and therefore reduce their expenditure.  They recognise that there aren't the jobs needed, so the penalise the unemployed, and invent fictitious paths to employment.  They actively support the use of overseas labour.

The Libs also pander to the fears that Australians have about the future by encouraging them to "get ahead".  Its a fear thing.  The perception is that in the future if you retire without enough money, you will suffer very real hardship, because the government can't collect the taxes needed to give you a decent retirement.  So the Libs will be generous in helping you avoid that fate - through tax tricks like negative gearing, and (until they fixed it a week ago) through incredibly generous superannuation for the well off.  Basically, its the Titanic.  Everyone is scrambling for lifeboats, of which there are too few (lack of taxes...).  There is some effort involved in climbing up to get on a lifeboat, and the Libs model is that some people should kneel down and form steps to help others get on board.

So my suggestion for the ALP.  Firstly paint the Libs model in all its defeatist and elitist glory.  And then, speak directly to those people who fear missing out on a lifeboat.  Tell them that you will tax the rich and the corporations, and that there will be lifeboats for all.  Tell them that they won't be used as stepping stones to help others clamber on to lifeboats.  Tell them that since we live in an ever more productive society, then need never fear being "left behind", and that  we live in a time of plenty, not scarcity.

Sunday, April 10, 2016

UWA restructure

So right now the University of Western Australia is undergoing a restructure.  We are going to lose around 200 "professional" staff.  "Professional" means you aren't an academic - you are an administrator or you do accounts, or you are a PA to an important person, or a lawyer, or you work in HR, or like me you are a unit coordinator, etc etc.  This is about 10% of the total.

The new model for the university is that there will be 4 faculties and a central admin.  Each of these will have a "service delivery centre" (SDC) which will house most of the admin functions.  This is a considerable reduction in the number of faculties, and this new model is supposed to allow the 10% cut in staff.

The current phase of the restructure involves deciding which professional positions are to be based in the SDCs, and which will be based in the individual schools that make up the university.

And I'm wondering about the restructure.  I'm wondering exactly what values will be driving this process.  What is in the hearts of the people driving the process?  Obviously everyone working at the university will have different priorities.  What do I value?

We teach students.  I love the students.  They are great young people at a very difficult time of their lives.  They've done well at school, but now they are making their own way, in an environment where they may not do well.  They are starting to chart their own path in the world.  They may not be able to achieve what they set out to do.  Dreams may be shattered.  I reckon we owe them something.

We have to offer them a good degree.  High quality, with high standards.  A degree that has some status in the world.

We should not enrol students who have no chance of success.  Universities have plenty of data on high school and degree performance.  The very least they should do is give students an idea of their chances of success in their proposed course(s) of study.  Its not impossible for a student with a weak background to succeed, but at least we should tell them up front that they have a long hard road ahead of them.

We have to fail students who don't master the material.  We do no favours to first years if we let them progress to second year despite a failure to master the first year material.  "Failure" is not really failure, it is just a sign that your efforts are best taken in a different direction.  By not giving that signal early, we are delaying the inevitable and wasting the students time.

Clearly the university makes money from students.  So the university has a motivation to pass students who should fail.  But ultimately the professional pride in each of the schools at the university will stop them handing out degrees to undeserving students.  It really is best if students stop wasting their time as soon as possible.

A very important part of failing students who haven't mastered the material is not allowing cheating.  There is currently a push towards online testing.  Why?  Because it is cheaper to do testing online, but I have yet to hear of a method of having online assessment for 1000 students that isn't susceptible to cheating.  I look after a unit where there is an online assessment component.  Its worth 10%.  If it wasn't worth marks, the students wouldn't do it.  That is why its worth marks.  The reason its only worth 10% is because you can cheat at it.  So you can't pass the unit just by cheating on this component.

In some situations markers are paid casual rates, but are told that a certain number of essays are expected to be marked per hour.  So if we give you 40 essays, we will pay you for 2 hours.  If such a marker detects cheating, they will be required to do extra work, work that may not result in extra pay.  Such markers will, suprise, suprise, detect very little cheating.  Whatever structure UWA decides on, they do need to make sure that perverse incentives to tolerate cheating are not part of the system.

We have to be organised and efficient.  Its one thing to have students failing because they aren't good enough, but quite another for it to happen because their course of study is disorganised and haphazard.  Every unit should have a clear structure spelt out at the start of semester so that students know what is expected of them.   The students fill in a "SURF" survey on each unit, and generally the scores are good.  Where they aren't, the university tries pretty hard to fix it.  This will be a key part of the restructure.  If SURF scores fall, the university needs to see if any of that has been caused by the restructure, and fix it immediately.

Lastly, all the core units that make up the backbone of a degree should form a cohesive structure.

So mainly I care that we do the right thing by our students.  And I hope that the students are uppermost in the minds of the people doing the restructure.  And not just because of the dollars attached to them.

Friday, April 8, 2016

That diet thing

So back on 22nd November 2014, I started monitoring my weight.  I wanted to lose weight, and figured that before I tried to do that, I should at least have an idea about how my weight behaved.  I weighed myself each morning, after going to the toilet, but before eating anything.

In February 2015, I had some gastro, and decided to start a diet.  A pretty simple diet - no food after about 8pm at night.  Typically this removed a bowl of muesli eaten at around 10pm.  I based this diet on the idea that fasting was good, but that I didn't have enough willpower to actually fast for a whole day.  I also figured that this was not a temporary measure, but a change for the rest of my life.  With that in mind, I didn't want anything too onerous.

The weight just dropped off.  By May I'd lost about 6kg.  Then the weight loss stopped.  It was flat until October, at which point it went up slightly until early January 2016.  And then it started falling again.  Its now down 8 - 9 kg from the start.

You'll notice that I changed scales around June 2015, to ones that weigh to 0.1 kg instead of 0.5 kg.  The new ones also weighed about 2 kg heavier, (measured over a 3 week period where both scales were used), so I added 2.01 kg to each of the measurements taken with the old scales.

Wednesday, April 6, 2016

Australian Liberal Party Policy

The Australian Liberal Party, the equivalent of the Conservatives in the UK or the Republicans in the US hasn't really announced any policies for the election that will be held this year.  Except they have.  It pretty much goes like this:

We accept that we can't force companies to pay tax, and that we can't collect tax from wealthy Australians.  We won't do anything about negative gearing, or about those ridiculous superannuation laws for the moderately wealthy.  We won't ask more than a pittance from BHP and Rio as they ship Australia to China, bit by bit.

We can't collect any more tax from those ordinary Joe Blows who actually do pay tax, so we just don't have enough income.

As a result, we will be gradually cutting spending on government hospitals and schools.  We will be trying very hard to take money away from low income earners and those on welfare.  We will do our bit to help corporations make even more money.  Because if we don't, they will pack up their bags and leave.

In our future we see a two tier society.  The ambitious and well connected, going to private schools, and private hospitals, and those who will just have to scratch around for scraps.  If you have illusions that you are in the top tier, great, you'll vote for us.  If you don't, we aim to convince you that the without the top tier being fabulously well off, you will be even worse off.  Look, we know its a lie, but you can fool some of the people all of the time.

Monday, March 28, 2016

The price of a closed shop

The medical specialties in Australia are a closed shop, and it is a disgrace.  Perfectly qualified people are denied the chance to practice as anaesthetists, gynaecologists, dermatologists, immunologists etc etc, not because they aren't any good at it, but because entry to those specialties are controlled by the existing specialists, and they have a very strong vested interest in keeping newcomers out.

And it appears that this may have contributed to this tragedy.

Try booking a specialist appointment.  You will notice that they are not desperate for work.  That they don't say, "Is tomorrow at 3pm good for you?".

If the Australian government had any guts whatsoever, they would tackle this now.  But no, the Australian government is busy tackling penalty rates for hospitality workers on Sundays.  The Australian government is busy making sure that the backpackers who are paid a pittance to pick the fruit we eat - that they are taxed properly.  Not the multinationals who shift their profits to Singapore - no, the fruit pickers.