The Daily Parker

Politics, Weather, Photography, and the Dog

M'aidez

The bad news is I've been in meetings with clients all day. The good news is their office has a view of the Golden Gate Bridge.

Updates as warranted. And as I have time for.

3,002

I had meant to make a note of my 3,000th blog posting, but I completely forgot it was coming. So, after 2,353 days (and 24 minutes), three house moves, a few significant personal events, and Parker's entire life, The Daily Parker is still going strong.

At the historical posting rate for the blog (1.28 per day), I'll hit 6,000 entries in September 2018 and 10,000 entries by April 2027. (For the last two years, though, I've posted about 1.5 per day, so you could see 10,000 as early as April 2025.) Stick around.

And thanks for reading.

Lena gets a scar

The word we would use in programming to describe this situation is: "FFFUUUUUUUUU—":

Someone parked by Braille. Someone has grey paint on his bumper. Someone is my sworn enemy.

Another quick link roundup

I like being busy, but it does take time away from lower-priority pursuits like blogging. If I had more time, I'd pontificate on the following:

For now, though, it's back to the mines.

Tonight, on 60 Minutes

Mike Wallace: Now, you've watched this gate for many years, right?

St Peter: Yes, that's right.

MW: And do you decide who gets in the gates?

SP: Well...I mean, I don't make the final decisions, no...

MW: But you can, for example, send someone to the back of the line?

SP: That's...you know, that's not something that would be done. In some, rare cases, people decide to return to the end of the line on their own.

MW: Peter, come on. Did Carl Sagan go back on his own?

SP: Well, look...you know, Carl was...look, Carl was a special case, being an atheist and all. There wasn't a decision made or anything. He got to the gate and decided, you know, on his own I think, that he didn't want to go in.

MW: Well, we spoke to Carl a little while ago, and he said, I'm quoting here, "There were billions and billions of people in the line, and I had to walk past all of them after St. Peter turned me away." What do you think about that? Did you make Carl Sagan walk back to the end of a line containing billions of people?

SP: OK, you know, I'm not... Look, if a decision was made, it wasn't made by me. I don't make policy, I'm just the guy, you know, at the gate.

MW: Sagan went on to say that you said a couple of other things to him. Peter, did you call Carl Sagan a "dirty unbeliever" and an "apostate?"

SP: Now, wait, that's just... Look, I can't comment on that.

MW: Peter, did you send Carl Sagan to the end of the line?

SP: Mike, I'm sorry, I really can't answer that question.

MW: Peter, did you send Carl Sagan to the end of the line because he was an atheist?

MW (in studio): Peter ended the interview at that point. But still, we're left with the question, who decides who gets in? After repeated denials from the Trinity, we were able to speak to Metatron...

Sunday link roundup

Some items that have gotten my attention:

More, I'm sure, later.

What to do with $540 million?

The Mega Millions lottery, held in 42 states including Illinois, now has an estimated jackpot over $540m. (The amount will probably be higher as more people buy tickets.) But how much do you really get if you win?

First, you have to choose whether to get 26 annual payments or take the award as a lump sum. The lottery uses a discounted cash flow analysis so that the amount you get as a cash lump is worth the same as 26 equal payments of the whole thing. In other words, if you get a lump sum, you actaully only get the amount that the total award would be worth if you took it in the future.

Take that $540m prize. If you take it as an annuity over 26 years, you get 26 payments of just under $21m each. But a promise of $21m in 2038 is worth a lot less than $21m right now. Think about it: if you have that $21m today, instead of 26 years from now, you can make investments, give it away, buy a lot of stuff that gives you happiness, etc. So how much is $21m in 2038 worth right now? Only $10.7m. Or, put another way, if you take $10.7m in 2038 or $21m today, it's worth about the same—according to the lottery.

We can figure this out by looking at the lump-sum value you would get if you opted for it. If you won today's lottery, Mega Millions will give you $540m only if you take it in 26 payments. Or they'll give you a steaming pile of $389m in cash right now. Because to them, it's the same value.

Why? If you win, you have to make a bet on whether they've estimated something called the discount rate correctly. The discount rate is a guess about how much money will be worth in the future because of things like inflation and the risk that investments change in value. For example, if I bet on a discount rate of 4% (which is historically about middling in the U.S.), I'm betting money gets less valuable by about 4% per year on average. In that case, if I give you the option of taking $100 today or $104 a year from now, and you think the discount rate is 4%, it's an even bet. But if you think the discount rate is 3%, you would take the $104 in a year—because by your estimate, $100 invested today is only going to be worth $103 in a year.

Using a quick Excel function, I figured out that Mega Millions uses a discount rate of 2.6%, well below historical averages but close to what we've seen in the last five years. Here's the calculation:

Yeah, but watch this. If you increase the discount rate to 4%, the estimate of the present value of that $540m drops to $332m, a difference of $57m. In other words, because the lottery uses such a low rate, if you bet that the rate is 1.4% higher, you're betting that you'll come out ahead $57m by taking the money right now instead of over 26 years.

So, great, you're getting $389m in one big pile. Excellent.

Later today I'll talk about your Federal (36%) and Illinois (5%) taxes...and what they might do to the calculation.

More coyotes in cities

Via reader DB, a report of a coyote captured in downtown Boston:

At about 3 p.m., the 40-pound animal was finally located by Animal Rescue League workers. It was found cowering next to a downtown building near the corner of Lincoln and Summer streets, surrounded by a crowd of curious onlookers and police. Using teamwork, a large net, and a catchpole, the rescue workers were able to catch it.

[A Boston Animal Rescue League spokesman] suspected that the animal most likely was able to enter the city by following train tracks, but couldn’t find its way back. He said this happens a few times a year and that coyotes are much easier to catch than deer.

We've had coyotes in Chicago news a few times in the past couple of years. I've seen them as well, the last time right by the Whole Foods in Lincoln Park. I love how they've learned to adapt to us—and what they're doing to the rabbit and Canada goose populations. (Sorry, Bugs, you're just a long-eared rat.)