I wrote this to try to explain Bitcoin mining.

Here’s an analogy for Bitcoin mining.

Let’s say I open a giant factory to make origami sculptures. I open the doors and say that anyone that wants to work for me is welcome.

You bring your own paper.

I pay per piece and I pay in gold coins worth about $10 each.

I want an average of 3 sculptures per hour. If the people are producing more than that, I’ll make a more complicated pattern that takes them longer to fold.

Whenever someone brings me a completed sculpture, everyone else throws their paper in the garbage and the next pattern I want folded goes up on the big board.

The gold coin I pay per sculpture never changes but let’s say the price of gold goes up 10% every day.

Do you bring your paper and come work in my factory?

Also, China sends a giant delegation of expert origami artists to work for me.

Note that just because you're not very good at origami doesn't mean you can't take a crack at this and maybe get a gold coin.

If you like, you can get together with a bunch of your friends and even a bunch of complete strangers and come to an agreement that you'll all go to the factory and, if any one of you earns anything, you'll pool it together and then divide it up based on how many folds you made. Even if all your papers ultimately went in the garbage, you should still get something out of this.

Obviously you're gonna want some ringers in your group and they'll be folding way faster than you are and with more accuracy. It's only fair that they'll get a bigger share of the loot. So number of folds seems like as good a measure as any to divide it up.

Steve will collect all the coins for the group and put them in a bucket in his basement. He'll give you access to a spreadsheet so you can check whenever you like to see how many coins your group earned and how much of it is your share.

One day Steve will tell you he went to put the latest coins in the bucket but found it empty. There's no coins in it. Steve has no idea how this could have happened.

Steve will then buy a yacht.

I've been looking into the whole crypto-currency thing to understand how it all works. I think I've got a pretty good handle on it now.

FWIW, my conclusion is that the whole thing could go up in smoke at any time and is ripe for manipulation but that a lot of people are going to make a lot of money right up until it does. It's basically a giant game of hot potato and whoever is holding the coins when the music stops loses.

As part of my research, I went and got myself a Bitcoin wallet and would love nothing more than to see it actually do something.

To that end, I sent out a tweet and a few messages basically begging anyone who would listen to send me some small fraction of a Bitcoin. Just a penny's worth. Enough to buy a gummy bear. Nothing more.

So far, nobody has. I've utterly failed in my fundraising goal and will probably never be able to afford the sweet sugariness of a gummy bear.

You can see the balance and transaction history of my wallet here. https://blockchain.info/address/1CSo3bVBkxBErBtGfi1KxPpahjApjn5r4Z

Nothing. Absolutely nothing. 🙂

This was just too amusing to not post.

I was having a chat about tax software and someone mentioned that TurboTax might be worth a shot. Right now all my tax history is kept in some software called ProFile so my first thought was whether or not I can easily convert those files.

I went to the TurboTax website and right at the top is a box that says "Ask a question, get an expert answer". Sounds like exactly what I need!

So here is what happened:

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Your Question
“Convert profile history”

Our Expert Answer
The vehicle plug-in conversion credit is 10% of the cost of converting any motor vehicle (new or used) to a qualified plug-in electric drive motor vehicle. The maximum credit is $4,000 per vehicle. The property must be placed in service after February 17, 2009 through 2011. TurboTax will calculate your allowable credit.
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And that is all. Just that answer. Lol! Well there you have it. Probably not for me…

I, and most other people who get paid bi-weekly, get 26 paycheques a year.

Someone pointed out to me that if I take my gross pay and multiply it by 26, it comes out to less than my supposed annual salary.

As it turns out, it comes out to my annual salary minus exactly a day’s worth of pay. This isn’t accounting for leap years, when essentially I work an extra day for free.

I figured that there had to be some accounting for this discrepancy. Is there an adjustment somewhere? Is there some reason for this?

Well… I did some digging… which is to say I printed off a bunch of calendars and worked out the pay periods and found that every 14 years, there is a LEAP PAYCHEQUE! A year with 27 paycheques in it!!!

Now, this would have been a lot more exciting if it were nearby, but it’s not. I figured out that if you get paid biweekly on Thursday, like I do, and if tomorrow is pay day for you… then the next Leap Paycheque will occur in 2020. 2020 will have three-pay months in January, July, and December!

So… woot! You heard it here first. Only 8 more years…

Incidentally, if you’re on the opposite cycle, and NEXT Thursday is your payday, then your Leap Paycheque will come in 2015. Only 4 more years for you, you lucky bastard!

So the Greeks seem determined to plunge the world into another deep recession.

Now… the fact that they're able to do this is a topic of its own, but that's not my point here.

I'm just wondering whether they're doing it on purpose to line their own pockets. The people in charge are part of the infamous 1% right? So this seems like the sort of thing they'd do… and rest of the world be damned.

If the Greeks look like they're about to resolve their issues and take care of business, the markets go up like a rocket.

If they give the indication that they're full of crap and can't resolve anything at all, the markets drop like a rock.

So if you're in charge there… and you buy a bunch of index funds… you'd do well to announce to the world that everything is under control.

Then you sell your funds at a massive profit. You then short-sell a bunch of ETF's and… I don't know… maybe announce that you've changed your mind and decided to let the people decide in some snap referendum.

There's another massive profit.

And so on and so forth.

I mean… these guys know exactly what's going to happen based on what they decide to do. How do we know they're not all just messing with us for their own gain? They're politicians, right?

I entered a contest on moneyville.ca by writing a blog entry with some financial advice.

They didn't like it enough to put me in the final five, but I'd hate for nobody to ever read it. It took some effort to pare it down to (EXACTLY!) 500 words, so it would be a shame for that effort to be in vane.

So I'll post it here. Now 2 or 3 people will read it. 🙂

So here it is. My advice on paying down your mortgage early.

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Your lender tells you about Accelerated Bi-Weekly payments as a way to pay off your mortgage quicker without much impact to your wallet. Take your monthly payment, divide it by two, and pay that amount every other week (bi-weekly). It’s like magic.

It’s a great idea.

It’s not magic though. What’s happening is you’re choosing a bi-weekly payment and a shorter amortization period. That’s the time it’s expected to take to pay off your mortgage. The standard to start with is 25 years.

I suggest you take that further. You can make higher payments. Paying more each month may not make a huge difference now, but you’ll thank me in 10 years when you’ve got a year or two of payments left instead of 15 years. With 5 years left, you’ll look forward to being mortgage free and thinking about how you’ll spend all that money each month. With 10+ years remaining, that’s just science fiction.

Understand that the amortization period, so long as it’s less than you got approved for, is an arbitrary number and you can ask for whatever you want.

RBC has a “double-up” option that allows you to manage this yourself on a payment to payment basis. I expect other lenders have similar things. My wife and I used this to manage our mortgage as follows.

First, buy a house you can afford. If you can barely make your payments, then you’ve taken away your options.

Next, decide how much you can pay every other week.

This should be higher than what the bank is expecting. Then drop it down to give yourself some buffer, and make that your payment. Finally, increase your payment to be up to double that (which should be way too much or you started too low) and test the waters, adjusting up and down as you feel comfortable.

Here’s an example.

You're borrowing $300k and the current variable rate is 3%.

A 25 year mortgage will have a bi-weekly payment of $655.27.

The "accelerated bi-weekly" option will change the amortization to 22.2 years and make the payment $709.87.

You then decide to make payments of $900.

Set the bi-weekly payment to $800, so even though you can pay $900, you can drop it down later if you were too ambitious, or just want to put $200/mo toward something else.

Ask the lender for an amortization period of 18 years and 10 months. Your bi-weekly payment becomes $801.43. Immediately set a schedule to add $98.57 to each payment, making it $900.

When your husband seems to have too much money at the end of each month, convince him that you can each pay an extra $200 a month toward your future. If it's too much, you can drop it back down again. So you increase your payment to $1100. Now, your mortgage will be paid off in 12 years and 7 months and you'll have paid $50,000 less in interest than if you'd done the accelerated bi-weekly option. How cool is that??

Markets are rising yet again. It's good news for all of us with seriously depleted retirement funds. Perhaps the end is not so nigh afterall.

With that in mind, I am officially declaring the recession as over. You heard it here first.

In more interesting news, Kyle Busch dominated the field yesterday to win at Bristol in what turned out to be a reasonably entertaining race. If last year was any indication, then next week's race at Martinsville should be even better, and I can't wait. Hooray for short tracks! Let the pushing and shoving continue!

I just saw a link to the energyshop.com site from a news article, and remembered a previous post here.

Someone anonymously replied linking to that same site.

I went and checked it out, and can't help but to feel like they're trying to pull a fast one on me.

They list a bunch of the energy retailers (scammers) and their prices.  Then, toward the bottom, they list quite separately the "Regulated Residential Rates", which is what you pay Enbridge.

The chart for the scammers shows only the gas supply rates.  The cheapest (and I assume the one this site is associated with) is Canadian RiteRate Energy, at 35.8 ¢/m3 for a 5 year contract or 38.8 ¢/m3 for 3 years.

The very different chart, for the market supplier, has completely different headings.  I'll describe it here:

First it says the gas supply is 30.36 ¢/m3.  Then it mentions a -3.96 ¢/m3 adjustment.  They don't do the math, but that tells me the supply rate is actually 26.4 ¢/m3, a number not mentioned at all on the chart.  

Note, at this point, that the very cheapest rate offered from a retailer is a full 36% higher than this market rate.

Next on the chart is the 14 ¢/m3 delivery charge that you have to pay no matter who you're paying for your gas.  That's not mentioned anywhere on the previous chart for the retailers, but you have to pay that when you're buying from them as well.  Finally, it lists a "Total ¢/m3" of 40.39, which has every indication of being more money than you'll pay a retailer, even though it's far less.  That's followed up with some mention of a monthly fee and an estimated bill amount of nearly $1400.  

Is there an estimated bill amount listed for the retailers?  Nope.  

Are you feeling like they're trying to deceive you?  You should, because they are.

For what it's worth, I'm going to do the math for you and toss out my own estimated billing number here.

Based on 31,000 m³ / year, at the very best rate they're offering I estimate you'll pay $15,449.95.  Now put that in your pipe and smoke it!

For years now insurance companies have been giving discounts to people for having taken driver education classes.

This is the driving reason behind many people taking them, or perhaps buying certificates saying they've taken them.

Now there are statistics showing that those who have taken a driver education course in Ontario are 62% more likely than those who have not to get into a collision. That's no small statistical potatos!

So with that in mind… should I not be getting a discount based on the fact that I have not taken such a course? Isn't that how insurance companies come up with these sorts of things? Aren't they based on the evaluated risk determined from these sorts of statistics?

It's been fraud week in NotWeaselLand.

My credit card was stolen over the weekend and whoever took it apparently tried to spend a few grand on Monday. Visa didn't let it go through, so all is well, but the whole thing has been quite an inconvenience.

To top it off, I've also found out that somebody back in June got a cell phone in my name and now they seem to think I'm going to foot the tab for it.

*sigh*

Wouldn't the world be a nicer place if everyone was honest and earned their own keep?

Perhaps it's time to bring back public flogging.