Monetizing Living Cost In A Long Term Currency Unit

Definitions

Long term here means centuries, millenias, eon.

The idea is to find out some unit of currency which is valid both in long term and across most regions of world. Then figure out how much in that currency is needed to live.
 

Constancy

The amount in that currency needed for living costs must be constant.

What Is Included (And What Is Not)

Living cost includes this:

• Food
• Clothing (clothes to wear + bedsheets + curtains etc)
• Commercial Services (barber + traders' profit + transportation + entertainment etc)
• Industrial goods (housing + utensils + furniture etc)

Living costs do not include:

• Savings
• Medical (supposed to be provided by govt for free)
• Education (supposed to be provided by govt for free)
• Utility bills  
• Wastes (luxuries + losses etc)

The calculation is for a livable as well as pleasurable living but do not include luxuries, savings, welfare services (education, medical, security) etc.

The Currency

The currency is goat's meat. Unit is 200 grams of that. This works well as a universal unit, free of inflation, appropriate for most of the last eon of history and is good enough across most regions.

Lets name this unit "star". One star = 200 grams of goat's meat.

How Much Is Needed

It turns out that money needed for food when cooked at home is 1.5 stars per day per average person. Average person here includes children and old people, therefore a working-age woman is 1.2 average person and a working-age man is 1.5 average person, due to higher than average food and other needs. Working age is 20 to 50, after 50 its age of taking work from others then retirement.

For clothing the need is of 0.5 stars.

For commercial services and industrial goods, the need is 0.5 stars.

For entertainment the need is 0.5 stars.

Altogether, the minimum long-term livable living expense is 3 stars per person per day.

Adjustments

Now the adjustments part. If we include medical and educational expenses, then 1 more star have to be included, making it 4 stars. If we include utility bills then another 1 star have to be added.

Therefore money equal to 0.5 to 1.0 kg of goat's meat is what is needed per person per day. Below 0.5 one has to borrow, above 1.0 either there is waste or saving or both.

In Terms Of Hours Of Labor

In terms of hours of labor needed to produce these stuff, when all work is done manually i.e. without electricity and fossil fuels, it takes 72 hours to produce and gather enough food, herbs, honey, fiber for clothes. 24 hours to process fiber and leather to make clothes and shoes. 12 hours to  produce minimum industrial goods. 12 hours to produce minimum commercial goods. 12 hours to produce more commercial services (this includes entertainment). 12 hours to produce more industrial goods (means better quality, more quantity, more items). 24 hours for education services, 24 hours for medical services. The calculation is per year and for an average person's need during that year. The calculation is for both production and expenditure.

At Minimum

In short:

Food: 72 hours = 1.5 stars
Clothing + Shoes: 24 hours = 0.5 stars
Minimum commercial services (no entertainment): 12 hours = 0.25 stars
Minimum industrial services: 12 hours = 0.25 stars

This add up to 2.5 stars or half kg goat's meat. This is the lowest sustainable level of living in long term.

Appropriate

On top of this, further things can be added:

More commercial services (e.g. entertainment): 12 hours = 0.25 stars
More industrial services (better housing, better other industrial stuff): 12 hours = 0.25 stars

This becomes 3 stars by now. This is a reasonable level of living because it is livable as well as pleasurable. This is the level of labor class. It do not include utility bills. It do not include services that are supposed to be provided by govt.

First Extension

On top of these, further things can be added:

Utility bills = 1.0 stars

Now it becomes 4 stars.

Second Extension

On top of these, further things which are education and medical can be added. If govt is weak then one has to pay for these too. The added cost is 1 star.

Conclusion

One point to note is, actual living costs never exceed 5 stars i.e. 240 hours. What comes after it is waste or saving. Driving in a personal car is actually a waste because proper public transportation should exist and be used. Living in a larger than needed house therefore increasing utility bills is still a waste. Going to far off places on vacations each year is also a waste.

Bonus: On The Production Side

The above is on the expenditures side. Now a little on the production side. A person working 7 hours per day, taking one day off a week, having 15 gazetted holidays a year, having 24 casual leaves a year, can work 1920 hours a year. This is equal to 40 stars.

We can get 1 worker of age 20 to 50 years and male gender out of every 4 people in population. Therefore, at most, 40% of production have to go to the labor. Rest goes to profit of business men, taxes, depreciation costs and expansions. We can make people work till age 60 but this is compensated by unemployment (due to lazyness + lacks of skills + disability etc).

Bonus: Where The Money Should Go

10% of production of a business should go in charity. Another 10% in compensating depreciation. Another 10% to 20% in operating expenses. Operating expenses includes seed and manure for farm, medicines for livestock, utility bills for offices, business-travel expenses etc. Its the rest 60% that is actually available.

Each of the worker produce on average 40 stars, out of which 60% is available which means 24 stars. We have to keep life standard of labor class to 3 stars. Since there is one worker in a population of every 4 people, we need to pay 12 stars to the worker. This is 30% of total income and 50% of available income.

The rest 12 stars is to be divided among business-owners and govt.

How to Win Over Competition

The only right way to win over competition, is to avoid competition altogether. This can be done by providing some unique services that your competitors don't. Then there is no competition and you have monopoly.

This is a great victory because you not just win over your competitors but also over the very idea of competition.

The other way i.e. the wrong way of fighting competition is to do same things that your competitors do, just do them more. The problem is, your competitors will likely respond with same action, evening out efforts of you and them both. Situation therefore become worse for both parties.

An example of this madness is price war in marketing, where two competitors striving for larger market share lock themselves in a race to bottom by reducing prices. In each cycle profit of both companies shrink making it harder for both of them to operate. Both continue this practice in anticipation of the other party failing first giving them monopoly. The problem is, it may happen that the damage is so huge that BOTH parties fail and a third one come and take over. Even if a third one do not come, the two can still sieze to exist.

In addition of damage to the fighting parties, there is a larger damage to the society as whole. Though consumes benefit initially by reduced prices, in long run they suffer as either the product is entirely lost due to failure of both parties or the winner now having monopoly raise price back to previous level and then some.

Another example of this in politics is arms race between two countries. As one country develop a new weapon after expenditure of enormous resources, the other soon develop a similar one of its own again with a huge expenditure of its own. This may continue till both of them die due to lack of reinvestments in productive sectors as an unsustainable portion of GDP is allocated to development and maintainence of weapons.

There are many ways of avoiding competition. One is to move to another market by a company, or move to another field such as arts or architecture by a country. Sometimes arts, architecture etc, i.e. the soft stuff, impress and nuetralize an adversary lot more than weapons technology or even a hot war.

In a forest, different kinds of animals exist, and do not compete with each other. There is a place for all kinds of birds for example because each of them get feeded on atleast slightly different food depending on shape of beak, have different survival tactics etc. While both lions and tigers feed on grass-eating animals, their diet is different. Tigers which cannot defeat lions in physical one-to-one fights have abilities of speed and tree-climbing which lions don't.

Its the same idea that animals and birds in wild follows during drought. When food go scarce they instead of fighting on the same resources, tend to migrate to other land where there is plenty of food.

Its the same idea that when there is clutter of available candidates for jobs in a particular field, a lot of candidates simply abandon the field by learning new skills and moving on to other fields which have capacity to accomodate them.

The natural alternative of diversification is starvation. Since resources are not enough to sustain all of the existing parties, some have to die if they do not move on by diversification.

If you are a small company then you cannot compete with your large competitor company. You can however diversify yourself by operating only in the marginal markets which are too small for your competitor to work in but large enough to sustain you . You can diversify in other ways too, the most obvious is to moving to a different product, but also by providing direct sales, faster customer service etc.

If there is for example a large forest in a country producing high quality wood that another country wants, then one way is to fight over that resource, by invasion. This requires huge expenditure of resources by the invader and if the victory do not come fast then another large amount of resources are spend by the defending country. There is however another way for the first country to get the wood without a fight. Its called trade. Ofcourse the first country have to produce something of value to gain money to buy the wood but still its a net positive scheme.

Trade is the base of peaceful co-existence. It enables parties to share resources with benefit going to not just the trading parties but to all the parties because of increase in efficiency. Each of the two parties produce only what they are good in, resulting more and better, and then through trade getting those things they need and the other party produce and sale.

This is not to say that war and competition do not have its place.  One should go for them only when either one's survival is at stake, or when victory is reasonably expected to be cheap and fast. The latter happens when you have special divine help, enemy is too weak, you have just mastered a new technology and have a window, pillars of enemy are defecting to you, or you have just gained huge alliances etc. Its however useless to compete when enemy is roughly as strong as you.

In the light of above, nazi invasion of soviet union was the right decision as far as military strategy goes. Soviet military has just killed almost all of its officers down to level of major, had suffered huge losses by tiny Finland and is generally in middle of industralization. It was that at operation level that fatal blunders were made by nazis like spreading forces on a wide front, providing inappropriate clothing to soldiers, ignoring lacks of roads and general brutality towards conquered people that the defeat came.

Things You Should Never Do In A Software Project

Branching

Its when different branches of your code have different features. Problem comes when you built on features on basis of work already done in other features. Then when you need these new features in other branches you lack that basic work which is necessary. As a result you have to almost have those features in the branches, which means doing the same work over and over again.

The solution is to move on a single branch, adding features as needed. Then use end-user administrator-level configuration to turn off features that are not needed.

Finished but Unreleased Features

Once a feature is completed and appropriately tested, it should be released. Piling up features to be released in the next mega version is a waste.

The solution is to use sub-version to release less important features.

Having Multiple Owners

Owner here means administrator, that is, a person who is responsible for the project. There have to be exactly one owner of the project, who is fully responsible for the progress on the project. The person who initially started the project is also usually the person who done most of the base work, such as building the underlying engine/kernel, and is also the person who took many critical early decisions about the project such as what technology to use, what platform to support, what architecture to follow and what libraries to use. This person is naturally the most appropriate person to own the project.

No matter how large the project is, and how many hundreds or thousands of programmers are involved, the owner have to be one and only one person. This is the person whom you expect to be the first to go the extra miles for the success of project even when not asked. Its also the person who is brave enough to handle wrong decisions of management often by forcing a reversal.

Throwing In Extra Men On a Delayed Project

This never works. If a project missed deadline then adding new personnel to the project make it to be delayed further than in the absence of them. This is because software development is such a hi-tech job that new people requires project-specific training and there previous experience not help much.

The solution is to make the same people continue work on the project that are already working on the project. If the initial staff is no longer available, then its ok to have a fresh team but thats a separate thing and is a valid strategy irrespective of delay state of project.

Habitually Forcing Programmers to Work Extra Hours

While its ok to force your programmers to work extra hours, especially near release date of project, its a bad idea to make a habit out of it. Tired mind produce buggy code, because the components are not well-tested before they are relied on, certain shortcuts are made here and there, the approach used is too specific to be used elsewhere in project etc.

The solution is to allow programmers go home at end of day. Ofcourse to stay in profit this implies that you have to be very careful when hiring programmers to have only the skilled ones so they do not take undue advantage out of this strategy.

Avoiding Static Code

Languages have the feature of static methods for a reason. The methods that work ONLY on the sent in parameters are supposed to be static, because they do not depend (i.e. use) any object or global state. Examples include encryption, hashing, DAL used with stored procedures, selecting last item in dropdownlist, returning an array of values of items selected in a multi-select dropdownlist etc.

There are enormous benefits of static methods including having a ready library that can be used in other projects.

Static methods are anti-object-oriented because they defy architecture. In a sense they lie flat in the highly structured OOP environment. This is a good thing because of three reasons:

• You do not need boiler-plate instantiation and initialization code of building object graph before they can be used. Instead you can use them directly.

• Changes in class hierarchy structure do not effect them. So this is one less place to test and solve bugs when such changes happens.

•  They can be used in other projects which have different class hierarchies. 

These methods are inherently thread-safe because they do not depend on any state.

Having Noisy Environment Around Programmers

This reduces efficiency because programmers tend to slow down while keeping in mind workflow of a group of variables they are currently working on. Other problems include poorly thought or poorly implemented architecture, buggy code and resignations.

For a programmer, a silent environment is marginally more important than even proper cooling and furniture and is hugely more important than salary.

Try, try again BUT don't be insane

When trying to achieve something, usually the first attempt fails, because of imperfection. Therefore one have to keep trying.

Almost all of the great achievements of mankind came only after repeated trial and error, sometimes hundreds or even more trials. For example, it took Edison more than a thousand attempts to make the bulb, aryans 500 years to expand to subcontinent, humanity 700,000 years to make fire etc.

 However, there is a fine line between this steadfastness and insanity as "Keep trying the same thing expecting different results" is still the definition of insanity.


In order to be persistent yet sane, a person do have to try again and again, but everytime change tactic a little, learn from mistakes, change sequence of steps etc. The idea is not to clone the effort, but to try different flavours of the same strategy.


Its worth mentioning that the strategy needs to be consistent, only the tactics needs to be continuously monitored and changed as per the day-to-day situation. If strategy changes then all the efforts made so far become irrelevant and one have to start again from zero, therefore strategy must be conserved. It goes without saying that strategy therefore must be made only after deep thought.


Note that when strategy is changed, efforts become irrelevant, not wasted. The difference is, in a later similar strategy, these efforts may be useful. Its like when R&D moth a project because of insufficient resources, then when research resumes on the project, one do not have to start from zero but can continue from the point things were paused.
 
There is yet a third thing: "not enough effort". It happens at times that a person is doing things with both right strategy and right tactic, but is simply not trying enough. Everything has a price, and often the price is a certain amount of effort or time, so a person have to stick to guns and keep firing till the castle falls. It do not matter whether a person change tactic or repeat exact same thing if he is simply not putting enough effort.

The telltale sign of not putting enough effort is giving up before the end, not completing the entire operation but quitting in between due to emotional exhaustation. One should let things go their natural course once effort is made, and patiently wait for the results. Sometimes failures are just bumps on the road and things are moving towards the goal. So patience too has its place.

Therefore one should begin with a strategy. The strategy needs to be simple, one-line sentence, and ifs must be avoided. Its OK to take time to make strategy because strategy needs to be comprehensive i.e. cover all cases. Examples of strategy are:

(1) "Europe first" by allied forces during world war 2. It simply means that the resources must focus on finishing war in europe first, before they be diverted towards the pacific theatre.

(2) "Tit for tat" in technology and arms, adopted by both soviet union and usa during the cold war.

(3) "Blood and iron" adopted by bismarck of german empire in 1880. The strategy was about fast industralization and waging wars to capture raw materials from neighbours.

(4) "Diversification" usually adopted by corporations. It means to develop new products to meet changed needs of markets. Its a viable strategy when for example due to technological advancement, the flagship product of company is getting decreased demand year over year and company cannot (due to lack of resources, patents etc) improve the flagship product. In this scenario, its better for company to develop a different product where it has more chances of success.

(5) "Retrenchment" adopted by empire or corporations when facing defeat. Its like when the outer wall of castle falls, the soldiers reposition on the inner wall, when that falls soldiers reposition at the keep. Sometimes there are so little chances of success at a wide front due to lack of resources or loss of some critical high ground, that its better to lose some ground to achieve better position and gain some stability and control. A corporation which in its boom days have expanded to several markets or products find hard later on to hold its position, can decide to shed off some product or market to focus on its core product or market where it has a better chance of survival.

(6) "Acquisition" adopted by corporations when facing competition. If you are a large company facing severe competition from an underdog whom you cannot defeat through product development or marketing, then its a viable option to buy the underdog. Being big you have resources to take over the little company and can digest it. Once you buy it, you can decide to shut it down to give your old product a better chance to prosper. Sometimes throwing money over problem is the fastest, easiest and at the same time best solution considering everything. Small cities in medieval times and even in classical antiquity (persians, greeks, romans) sometimes use a form of this strategy to avoid foreign invasions and subsequent plunders. Ofcourse they do not try to own the invaders, they just try to settle things down giving off some gifts. From the invader's point of view the benefit of gifts sometimes out-value the cost of sieging, fighting and capturing especially because the gifts can continue the next year and so on.

A strategy is built to last atleast for 5 years but may extend to a hundred years if overall scenario remains same. Strategy is also an empire-wide or corporation-wide affair, therefore it must take in account both current situation and expected change of events in time to come over all the units of empire/corporation.

Its important to have as many different point of views as one can muster from key sub-ordinates and friends.

Once a strategy is built and actual effort is started, one must give some flexibility to the commanders-at-front. As long as overall effort is moving in the right direction, its OK to change tactic on daily or weekly basis. If a tactic fails, and tactics fail more than they succeed, a different tactic must be used.

In between changing of tactic, one must not put aside the other two pillars of success: working hard enough, and patience. Like it takes a certain amount of energy to move a load up a cliff, and a certain amount of energy to shoot a rocket in space, there is a certain amount of energy needed to achieve a goal. While using a level or leveraging any other sweet spot, the amount of force (energy used per unit time) can be changed to some extent, the overall energy need cannot be changed. This is due to the second law of thermodynamics which is a fundamental law of universe and can never be broke. One can use a little force over a long period of time, or a large force over a small period of time, but the overall work (force x time) needed to gain something remains constant.

Enough effort must be put before anything can be achieved. No matter how comprehensive a strategy is, or how well tailored to situation the tactic is, no goal can be achieved if less than enough effort is poured.

Even if we have the first three pillars right: strategy, tactic, effort, we still cannot gain our goal if we are lacking enough patience. Putting effort in something is not enough, there is another factor, the factor of time. It takes a certain amount of time for energy used in effort to reach its target, then move things around, before effects can be seen. This is due to inertia, which is a fundamental property of matter. Things do not start moving as soon as they are pushed, they take sometime and during that time nothing moves. Once this time has passed the movement starts and things start getting rolled.

If things are not working out, then how can one be sure that the solution is just to wait a little more vs change of tactic/put-on-more-effort. The answer is to let events complete their cycle, do not quit in between. Its always a good idea to put a little more effort if one can muster more resources, but one should never change tactic before a cycle is completed. Let the effort reach the target then give it some time to react.

How can one know that a cycle has completed? At end of every cycle something big happens. For example in a marketing campaign, a cycle completes when end-user come to know about your effort, that is awareness reaches the usual percentage of your previous marketing campaigns. When you bang a ram on the castle, the cycle completes at each stroke when the door gets a swing, you hear a voice. If you are working against a competitor then its very easy to find when cycle completes, its when your competitor registers your efforts. The registration usually comes by a counter-attack from competitor but it can be other smaller things such as a complain (to you or to an authority), as a change of tactic by competitor, or simple retreat.

For every action there is a reaction. A cycle completes when reaction happens. Note that reaction do not happen immediately after action, due to inertia there is a passage of time before reaction happens. Its this passage of time during which you need to be patient. You should not change tactic before you see reaction. Its because you never know about the correctness of your tactic and amount of effort before you see reaction. If the reaction is no apparent crack in the wall then you have to try harder i.e. put on more effort because the thing is costlier than what you are putting in. If reaction is a crack then you are putting right amount of effort, you just have to put it for longer period of time, you do not have to take resources from other operations. If there is no crack in wall after a hundred cycles then your tactic is not working out, may be the wall is made of iron instead of concrete so your wooden ram is not enough. You have to change the tactic, i.e. try some other point on wall, or may be dig a tunnel. You still have to continue with your strategy of taking over the castle.

When applying for a job, it takes a substantial amount of time before your resume is visible to the employers among the pile of other resumes. May be you have chosen the right career (strategy), applying at right companies through right channels (tactic) and putting in right amount of effort (sending enough resumes), its just that due to inertia it takes time for your efforts to be fruitful.

While waiting patiently for your efforts to work, it not hurt to try in a little more effort, because it do not hurt anything, it just gives you better chances. If your resources have no other important uses, for example you are unemployed and therefore have lots of free time in hand, it do not hurt to learn something new in your field (putting in more effort).

Money

Money is media of possessions.

A media is a channel of transfer/transportation.  

Air is media of sound. Road is media of people. Blood is media of nutrients and oxygen. Vacuum is media of energy. A wire is media of electricity.

A media is means of transportation. A thing through which another thing can change position.

If you want to go from point A on surface of a planet to another point B on the surface of same planet then you have to go through a media. It could be the surface itself, or air, or space or even underground. All of these are media.

TV, internet, radio, sms, phone calls are all media of information.

If you want to exchange possessions with another human being, such as give some hours of labour and get a cell phone in return, then you can conveniently do so by using money.

Note that you can do exchange without money. This is called barter system. In barter system you exchange possessions directly. In money system you first convert your possessions into money, then give the money to the other person, and that person give you the thing.

In every money based transactions, possessions are converted into money twice.

Anything can be made into money, as long as its scarce. Another requirement is durability. A piece of wood cannot be used as money for long period of time because it may get burned, termite-eaten, or just plain damaged.

Money is not valuable, possessions are. Money is supposed to be kept for minimum period of time, and quickly changed into a possession. Keeping money for long period of time jam the economy.

Money is like blood. Blood itself is not valuable. Its the nutrients and oxygen that it transports which is of value. Blood without nutrients and oxygen is useless.


Blood is supposed to be kept running. Nutrients are constantly poured into blood by stomach and lungs and transported to all parts of body. If blood is holded in one part of body for a long period of time then the other parts of body suffer. Same way if money is locked in purses or safes, then nutrients, that is possessions stop being transferred and the whole system suffers. This is why markup is haram.

When a party takes markup, it holds money. Assuming 10% markup rate per period (period can be year, month whatever), it takes 110 units of money per 100 unit it gives, next time it takes 121 units of money and so on. Its like in every cycle, more and more blood is supplied to a certain organ. The other parts of body suffers, as their supply of blood keep on reducing. The part that gets more blood also get damaged after an initial boom.

Markup is more dangerous than looting and levying unfair taxes. Its because none of these have compounding effect that markup has. A very cruel govt can levy a draconian tax rate of 70% but the tax rate remains constant, no compounding. Compounding is when the rate itself increase. Note that even at a fixed markup rate of 10%, the rate of income that goes to banks can increase. For example at an income of Rs. 100, the markup is Rs. 10, next year it becomes Rs. 11, next year to that Rs. 12.1. The percentage of income that goes to banks keep on increasing.

One can say that the percentage of income that goes to banks would not increase if markup is paid the first year. Indeed markup can be paid every year, keeping the percentage of income going to banks constant, if the world is perfect. World is not perfect, problems do come, businesses do fail, natural disasters do come, prices do fluctuate. In most cases, percentage of income going in markup increase, not decrease.

One can say that in an expanding economy, production on average increases, therefore the burden of markup would reduce, not increase, in future. The expansion of economy is an anomaly. The expansion is due to increase in extraction of fossil fuels. In a finite planet in a finite universe, expansion cannot continue indefinitely. Rules are supposed to cover normal cases, a rule is not supposed to cover anomalies.

Expansion for a limited period of time may be universal, but loans are given to individuals. There is no guarantee that in an expanding economy, all of the business would expand, some would contract, some would vanish.

The expansion not comes free. More and more human effort (even if its just mental effort) is needed every year. Its the working labor that is supposed to get the benefit of expansion, not a banker.

Another cost of expansion is pollution. More you produce more you hurt the environment. At sometime you have to pay for the damage of environment, in terms of diseases for example. These costs are usually ignored.

One can say that we can estimate cost of pollution and compensate that by reducing markup rate. One can say that cost of disasters human or natural can be compensated through insurance. One can say that failure of individual business in an expanding economy can be covered by bankruptcy laws (by which lender cannot have money back if business fails). Even with all of these safeguards markup is inherently bad, not just bad but dangerous to economy. Let me explain.

So you have insurance, bankruptcy laws and very low markup rate. Still there are things you don't cover. Such as fall in profits due to increase in production costs or decrease in produced goods prices or both. There is no insurance against these. If you put insurance against these then you kill efficiency at other places by killing competition. Even if a company is still in profit, just that profit percentage decreases, the percentage that goes in markup increases. The reduction in profit may expand till you are not able to pay all of your markup, that is when the compounding effect kicks in. The markup which goes unpaid adds in the base loan and next time you have to pay even more markup, reducing your chance of taking your troubled company out of trouble.

Another problem is that, money becomes a comodity. Money itself is not supposed to become a commodity. Its like buying air before talking. Money is supposed to flow free. Markup is as dangerous to economy as private ownership of roads to transportation. If roads are privately owned, certain critical roads can be blocked by their private owners altogether irrespective of pricing.