CNET noted that the school system could be sued for violating a number of laws/regulations such as, "the Fourth Amendment, the Electronic Communication Privacy Act, the Computer Fraud Abuse Act, the Stored Communications Act, Section 1983 of the Civil Rights Act, the Pennsylvania Wiretapping and Electronic Surveillance Act, and Pennsylvania common law." They didn't even get into the potential child pornography charges that could potentially come from the girl who said that she shower with her laptop open to listen to music (if they are shown to have violated that).

I find the story interesting on many levels. Having a Computer Science degree and working in the technology industry for the past decade, I usually stay on top of technology happenings. It never occurred to me that a web cam could be used in a nefarious way like this. Take it a step further and imagine a virus that does the same thing. Yikes!

The biggest question for me from a financial perspective is, "What if the school is found guilty of all these violations?" The damages could be millions and spread across numerous families. On the outset it would seem that justice would be served and everyone could just move on. However, the community would be left with a bankrupt school system. That typically means raised taxes. So others in the town would have to pick up the pieces. This leads me to think, the ones who "win" could be the lawyers. It might even be in the community's best interest to root for the school as outlandish as it sounds.

Yesterday, I touched on the Legality of IPodMeister's digitizer service. Bringing up the First-Sale doctrine opened up a can of worms in my mind.

I love digital media, but I won't pay for it (or steal it obviously). I have never purchased a song from the iTunes Store. For too many years, all the songs were looked up so that they'd only play on certain Apple products. There were workarounds, but they were less than convenient for this Lazy Man. The iTunes Store is heading in the right direction making it so their songs do play everywhere (or so I've read). You could burn a CD of the songs you bought on iTunes and then rip that to MP3. There was some software that was a little more direct, but it just seemed to be a gamble. If I could spent money and get something without restrictions, why spend money and get restrictions? It's no problem to sell a CD to someone, but have you ever tried to sell a song you purchased on iTunes? Good luck with that.

I like the idea of the Amazon Kindle. I was very close to saying that I love it. After all it's a nice way to carry pile of books with you while traveling. However, when I looked at the Kindle in depth, I saw too many drawbacks. People aren't likely to steal a book at the beach if you go for a swim. If I like a book, I can't lend it to a friend. And like the iTunes Store, you can't sell the books you bought to others.

Amazon gets around this by stating in their End User Licensing Agreement (EULA), that you aren't really buying the book, but the rights to read it. You can read more here. Okay, I can play ball with that restriction, but you need to give me something else in return... like a much cheaper price. Of course as CNET's Rick Broda points out you often don't save much money on eBooks. You would expect a lot of savings considering that eBooks eliminate the need for: Paper, ink, shipping (gasoline, trucks, and drivers), warehouse storage, shelf space, sales staff, etc. but that's not the case. When you give up the rights to sell the book it's looking like a worse deal.

I don't want to pretend that there are no advantages to eBooks. There are features like search and digital annotation in addition to the aforementioned portability that are quite nice. In the end though, I think it comes up to be a wash or regular paper books having the advantage. This disappoints me, because I think we should be making moving forward with innovation and eBooks could be a large part of that - except that arbitrary restrictions hold them back.

It's that right of first sale that I don't understand. It would be technically easy for Amazon (and others) to implement one of two things

• Credit an Owner's Account a Percentage for Deletion of the eBook - In this scenario, you are essentially selling the book back to Amazon. Why would Amazon buy the book back? Simply because they know you A) are more likely to buy a book in the first place knowing that you can sell it back and B) will use the credit to buy more books hence making them more sales.
• Allow People to Sell their eBooks - It's easy to transfer the "Amazon license" from one account to another. In fact, Barnes and Noble's new Kindle competitor, the Nook allows you to lend eBooks to others, as long as you only do it once per book for a maximum of 14 days. It is a baby step in the right direction.

Some say that publishers don't want this digital media transferable because it's simply too easy and would cut into sales. People might just buy the first hundred thousand copies while the cheap guys (like myself) wait for them to finish and then buy them for the lowest price. I don't know why publishers fear this so much because that already happens. You can buy used books on Amazon. You can use PaperBackSwap.com to get books for free. And then there is that library system.

The Best Digital Media Solution

The RIAA should maintain some kind of huge database that notes the digital rights that everyone has. As long as you paid for the rights, you can get the music in any form you wish for a nominal free (downloading for free, a mix CD for a buck or two, etc.). Sure it's a privacy nightmare. However, I think consumers would buy into it. There are a lot of consumers out there who are fed up after buying Aerosmith's Toys in the Attic in 5 times (vinyl, 8-track, cassette, CD, iTunes). The RIAA says that a lot of the cost is paying the people producing the album, but if you paid those people with your vinyl purchase, why do you have to pay them again for the cassette version? If my CD gets scratched, it should be replaceable for the cost of the CD as all the parties are already properly compensated. If Toys in the Attic gets remastered or if we are talking movies with DVD extras, it's fair to charge the consumer a bit more to upgrade their license. However, the consumer should get the choice to keep the license for the previous work which they've paid for.

This solution would work for all digital media. If I bought a book on a Kindle and later decide that the Nook is a better device, whatever organization that binds book publishers should transfer over that license for easy downloading.

It's inevitable that we get there, it's just going to take time for media publishers and owners to realize that this is the fair way to make sure that everyone gets compensated fairly.

What does this have to do with history? The world is changing - extremely fast. Detroit used to be a thriving hotbed of wealth. Now it needs bailouts just to keep afloat for another few months. At last 2007's American Pharmacists Association, a distinguished speaker said that companies were exploring outsourcing clinical pharmacy studies oversea. Shoot the data over the Internet, have a pharmacist there analyze it and shoot the results back. It's that simple and a lot cheaper. At some level, either Americans have to start providing more value (how?) or one of two things is going to happen: American wages will drop or other countries' wages will rise. I imagine it will meet somewhere in the middle.

This has me thinking... for years financial advisers and Money magazine have repeated the 8-10% historic rate of return on stocks. Can we trust this history? What were the factors that contributed to that history? When I was growing up, I remember seeing things that said, Made in USA. I don't know if I've read that phrase in the last ten years. Might that impact the historical rate of return of US stocks? I think it might.

I often read the historical rates of return on real estate. It's had a big run and it seemed that around 2004 everyone was living by the "it always it goes up" credo. Well today we've learned that it's not entirely true. Perhaps the reason real estate jumped up over the 30 years is due to women getting more lucrative jobs and families finding themselves with more money. If people have more money, they can bid up the price of homes. If that theory is right, the blast of extra income was a one-time event. In the end, real estate prices have to track wages or people will be forced to stop buying.

What I take from this is that you should believe the popular mutual fund disclosure: past performance is no guarantee of future results. I'd take it a step further and say that past performance might not even be a good indicator of future results. Does that mean you should stop investing? I think you should look for opportunities in this changing world. If you think that television is going to go Internet via sites like Hulu and YouTube, perhaps a investing in Internet infrastructure is a good move (Cisco comes to mind). If you think that we are going to be slow to adopt solar technology, perhaps you should invest in oil. If you think that solar technology is going to be big in ten years (a point I wouldn't argue), perhaps you could invest in Claymore/MAC Global Solar Index or Market Vectors Solar Energy.

Does this mean that everyone in the United States is doomed? No. Now is the time to be proactive and think about the future of your field and your career. It's time to take a few minutes and not think about what's for dinner tonight, but what your long term plan is (unless you are already nearing retirement. In that case just carry on :-).

A final thought, this month's Money magazine points out that Japan has been in a bear market for 19 years - very much a whole generation. I wonder what the Japanese version of Money magazine says about historic rates of return.

Dear Xetra and Dax,

• Your Names - Sorry about the names. They seemed cool at the time. I didn't think your mom would take my bet. Even so, Matt Cassel himself didn't expect to win the Super Bowl.
• Your Education - I've seen a lot of specialists make a lot of money. I was a specialist myself - one of a dozen or so people in the United States who could program a computer in a very propietary computer language. However, like me, a lot of specialists lose their jobs when that specialty goes away and have nothing to fall back on. There's something to said about doing one thing and doing it well, but there's also a lot to be said for networking well, writing well, speaking well, and knowing technology well. There are a lot of other valuable skills as well, but that's a fine start.
• Your Time - It's the most valuable commodity you have. Right now, you probably view it as an infinite resource. It gets more finite with each passing minute. Look for ways to do something well once instead of having to do repetitive work. Many mistake your Dad as Lazy, but it's more about being efficient with your time.
• Your Money - If you haven't learned it by reading Dad's website by now, money is important. It buys you freedom from doing things that you don't want to do. It buys you freedom to do the things that you do want to do. It also buys you the ability to help friends and family in time of trouble.
• Your Happiness - I don't have it quite perfected yet, but I've been working on a recipe for this. Beyond that, I've found four factors of focus: family, friends, freedoms, and fitness.

New York Times published an article yesterday saying that maybe everything has changed, money does buy happiness after all. In my opinion, this is the defining statistic:

In the United States, about 90 percent of people in households making at least $250,000 a year called themselves “very happy” in a recent Gallup Poll. In households with income below $30,000, only 42 percent of people gave that answer.

I think you have to look at money as a way to buy various freedoms. If you win the lottery, you might not need a day job, which gives you a lot of freedom. However, you now have cousin Nick asking you to help him out of his credit card problem. You trade one stress for another. If you are a CEO of a big company, you have plenty of money. But then you have to deal with all the responsibility that comes with it. If a friend comes up with great tickets to the big game, you often have to say no and get back to work.

I think it's very difficult to find that happiness balance. Having money (and not the responsibility that comes with it) seems like a way to reduce those obstacles to a very happy life.

One of the best responses was from Programmer who said:

Have you tried learning a new or growing technology? Go where the demand is, become an expert, and work as a consultant to maximize your earnings... The best paid people aren't the code monkeys, but the ones who learn new tech. on their own, love what they do, and as a result have excellent skills because they're passionate about their tech... But, if you're lazy, then you're probably not worth a premium consulting rate anyway. Right?

My points:

• I have consulted and at $150+/hr. Unfortunately, I was skilled in a rare technology that no longer has the demand or potential to earn that. I'm not sure consulting is the answer for everyone as Programmer implied to be.
• I have gone where demand is (Silicon Valley), learned new technology (for me that was Java), but I have not become an "expert" or a consultant (yet). I didn't get to mentioning it, but one of the conversations I had with the friend was how Java (which is where the demand is nowadays) is extremely slow to get an application up and going. Someone in my last company had the equivalent of 200 lines of code to simulate a light bulbs state: on or off. That is not something to be passionate doing or something that motivates me to become an expert. It's something that motivates me to create a website that can me money in way other than programming and leave it to brilliant people in third world countries who will do it for much less than myself.
• As far as being lazy, my name is a reference to many articles about lazy programmers being the best kind of programmers: see this article and this one.

Here are some statements that I found myself nodding in agreement with...
Used Vans Girl said, "I think the problem isn't programming its monotony." Brip Blap echoed that with "Anything you do as a routine becomes dull."
East Side Food Geek said, "It sounds to me like software development ISN'T killing you, but rather the jobs you've had.... In any case, your side business gives you some freedom to be picky, to rebuild your personal brand and reenter the marketplace on your own terms." This comment was dead on and a reason why I started to look to side business. And I've found that as I start to look in the workplace, I can be extremely picky.
Ryuko mentioned "coding would not be a viable job, especially since more and more of them are being outsourced." I agree with that. AskDong said, "I often feel the same way. I'm burnt out, and often feel i'm letting my coworkers down. It really is a terrible feeling to want to do more but somehow not being able to muster it." Yep, I couldn't agree more with that.

And the one thing that I found wasn't true IN MY EXPERIENCE (I might need to just be in different places) as a Senior Software Engineer...
Kitty said, "One shouldn't confuse a software engineer with an application programmer, though, as some posters above seemed to do. Software engineering is not about coding, it is about system architecture, design, algorithms, problem-solving, ability to learn new technologies, creativity. Programming is the most trivial part of the job."
It should be that way, but I've found that companies often already have architecture and technologies in place and just need to extend it. That reduces the amount of design, creativity, and even algorithms that I could use. It left me with only programming. Often times I was doing very repetitive cut and pasting. This leads me to believe that it was more the job than anything else.

Blogging

• I wonder how readers will react to a whole post of random thoughts. Perhaps they'll let me know with a comments.
• I have about 18 design changes and features that I'd like to implement on Lazy Man and Money - if I had the time.
• I should write a whole lot more for Lazy Man and Health. It has so much potential, but my time management just isn't where it needs to be.

Finances

• I've been at my job for a year now. I expected to get some kind of recognition, but thus far there's been nothing. I expected at least an inflation-level raise considering how hot the software engineer market is in Silicon Valley.
• My current job has two of the best perks I've heard of... free lunch and dinner, and a monthly cash bonus for living close to the office.
• Google contacted me about working for them this week. Things just got interesting.
• I inherited $131 from a very distant relative who I've never met. Who says life isn't like Monopoly?

Life

• We've been thinking about getting a dog. I'm thinking it might be a good Christmas present to ourselves. I should read Free Money Finance about pet costs.
• Speaking of pets, Brip Blap indirectly reminded me how much I want a Sony Aibo. I'll keep an eye out for an exceptional bargain on one - and then I'll probably pass on it.
• My mother-in-law sent my wife a list of baby names this week. I guess that's a not so subtle hint that she wants to be a grandmother.
• My wife and I are having an extremely difficult time figuring out where in the United States we should live. There are so many thoughts going through each of our minds that I could blog about it all next week - and I just might.

Boston Sports

• Red Sox pulled out a strong first game of the playoffs. The Yankees lost big. Life is good.
• My wife is going to the game in Anaheim on Sunday. If the Red Sox win today, I'm sending a broom with her.
• The Patriots continue to break records. There's too much talk of going undefeated. It's good to know that they eat humble pie. They still have won 21 games in a row before so maybe going undefeated isn't impossible.
• Sunday is a huge day in Boston sports with a playoff baseball game and a football game. It would be nice to diversify the game on a couple of days. If things go bad, I could be catatonic on Sunday night.

Entertainment

• I love the Old Navy Sweater jingle. Check out the full version of the song on YouTube.

I know I'm not the first person to feel this way. In fact most people probably experience at their high school reunions. I immediately left my desk at work and went for a short walk. I had to process what change of events could have occurred to make him so successful.

I didn't dwell on that those thoughts too long, but quickly turned to my own situation. I'm not a big-wig at a company that everyone has heard of. In fact, the company I work for is so small few people in the local area have heard of it. I do make a salary that exceeds the average American's by a wide margin. I have this blog, with great readers and commenters, that is far more successful than I ever imagined.

After thoughts about career status success, it occurred to me that there are many more areas to judge success. LinkedIn doesn't tell me if Mr. VP spends twelve hours a day at work. It doesn't tell me if he has a loving wife to come home to. It doesn't say whether he has great friends or whether he's happy with his life. Perhaps it's time for another Self Appreciation Day - and perhaps I'm just as successful as Mr. Big-Wig VP after all.

Instead of tagging other people and collect likely inbound links from them, I'm going to end this branch here. When you think about it one person tagging another 3 or 4 has a multi-level nature to it. Since we know that these multi-level nature things eventually leave the person on the end without anyone to pass the baton to, I will fall on the sword and be that end. Or perhaps I'm just too Lazy to tag people... umm yeah it's probably the later...

It was this thought that occurred to me on the way to work the other day. If there are rich people who aren't happy and poor people who are very happy, it is possible that there is no correlation between wealth and happiness. If that is the case perhaps I should be writing a blog about how to achieve happiness instead of a blog about money.

The more I thought about it, there's really no particular reason why I can't do both. The problem I would have with trying to write about achieving happiness is that it's so general, abstract, and reader specific that I would be little more than a motivational writer. However, by writing about money, I can give you concrete ideas that can at least give you a tool to in your quest for happiness.

It was just last week, where this was born out in a conversation with my oldest friend. We used to play John Madden Football for hours on end. With the release of a new version coming out this past week, we reminisced about so of our legendary video game battles. I asked if he still plays, and he responded that he does not. He lamented that he could not afford a Wii because he was too house poor.

I think of money as buying me a level of freedom. Perhaps that includes a purchase of the Wii where I can spend quality time with my wife playing tennis. Perhaps that freedom is the ability to retire early and spend more time traveling the world. Perhaps that freedom will be getting our future children great education.

In the end, there are infinite possibilities of what we might do with enough money. Having those options may go a long way towards making us happy.

I have always lived near the big city, usually about ten miles away at the most. The two big cities are Boston and San Francisco. Here are some financial advantages I've learned about the big city:

• There are a number of places where I can save money by being more frugal. Trent mentions that a 20 oz Coke may be $1.60 in San Francisco. That may be true, but I rarely even buy one on the fly. I usually go to Walmart and stock up on cans and 2-liters. As I drove across the nation, I noticed that the pricing was surprising the same - 58 cents for a 2-liter of Sam's Choice - $3.98 for a 24 pack of cans.
• Looking at that previous bullet point again, I earn quite a big more in the city than I would elsewhere and I'm able to keep some of my costs the same. This gives me a greater surplus.
• The weather has been so good near San Francisco that most places don't even have air conditioning. The mild winters (below 32 degrees is considered an emergency) means that I use a minimum of heat. Comparing this to most areas in the country and $70 a month for gas and electricity (including about 6 billion computers and gadgets) add up to big savings.
• The level of education in Boston and San Francisco is tremendous. In Boston, I would find myself in groups where everyone went to MIT or Harvard. In San Francisco, I'd say about 80% of my current company has a degree from Stanford. Smart people are contagious or to put it another way, nothing attracts a crowd like a crowd.
• Time and time again I hear that San Francisco has a very high "quality of life." What that really entails differs on your preferences. However, it's fairly quick and easy for me to watch, not one, but two major league baseball teams. I could even go to a museum in the day and a baseball game at night. The culture and diversity is amazing.
• Competition for software developers in the area has reached the point where salaries and benefits are experiencing a bubble effect. With Google offering a gourmet cafeteria and other great perks, other companies have started to join in to compete. My company offers free lunch and dinner from restaurants around town delivered every day. They are also looking to give a $500/month in housing allowance if you live within a certain distance of the office. These benefits completely flabbergast most of the people I talk to.
• I imagine that it is very hard for someone from Iowa to move to San Francisco to retire. However, the reverse, moving from San Francisco to Iowa to retire strikes me as something entirely possible.

The more I think about it, the more opportunities seem to be in the city. If something were to happen to the company I work for in the country, could I get another equivalent job? I think the odds are much better in city. It makes me think that the odds of me working for the next YouTube is much better. The odds are still small, but their headquarters are within a five mile radius.  You never know, perhaps I'll be retiring in less than a year with a stroke of tremendous luck.

15. Learn about Compounding Interest - There's a reason why Einstein called compound interest "the most powerful force in the universe." (In reality my high school math teacher pushed this on our class, so I did know this in high school.)

14. There's a young woman who lives less than 8 miles from your home. You'll end up marrying her, so perhaps you should get started now before she moves 200 miles away and ten years pass.

13. I know it seems like you are saving a lot of money now. You are really doing a good job, but expenses will arise soon.

12. The Internet company that gave you a raise to 90K at age 24, will end up laying off the entire department with in a year...

11. ...so you probably shouldn't buy that new sports car convertible - even if it is under 30K. Plus it won't impress that girl nearly as much as you thought it might.

10. However, don't give up that summer in Newport, RI. You'll have so many memories that will last a lifetime.

9. You won't end up associating with any of the friends you have now.

8. Day-trading Internet stocks (you'll understand what an Internet stock is later) is fun - like gambling... because that's what it will be. You'll end up losing... Plus... doing your taxes will be a pain as well.

7. Stay away from girls from Maine or named Shannon. You'll meet quite a few of each and neither will be good for you.

6. The Computer Science degree is great, but really look into getting a MBA.

5. Look into gathering domain names of generic items and concepts as soon as possible.

4. Avoid buying 250-300 CDs, you'll have better things for money such as...

3. ... buying real estate. Seriously look into a home as early as possible. Mom will help you if necessary.

2. You were far ahead of your time with that purchase of Founder's Growth in high school. Excellent plan to put $50 a month in there. You'll be even smarter by betting on Bill Miller in two years and getting 10 years of S&P 500 beating performance... just stick with it and don't cash it all out.

1. Put some time into learning how to read quickly (without compromising comprehension) and write effectively. You are going to have a series of horrendous English teachers that will make you read books like Ethan Frome. You are going to doubt that there's really anything of any practical use. Dig deep into what they are saying or learn on your own, because it will be more important than programming language you'll ever learn.

Here are some things that others would say to themselves in high school:

• Rich Minx - agrees with the CD savings. Don't tell Lazy Man and Health, but spending all your money on alcohol sounds link fun.
• Susanna in the comments says "don't let your fiance run up his credit card balance."
• Brip Blap regrets doing vodka shots with Russian Mafiosos. Yes, you read that right.
• Blunt Money sounds like she would tell herself to be more confident.
• Cannibal Crowley wish he tried out for the football team. I wish I did as well, not because I'm athletic, but because I love the game and would like to be closer to it.
• Smith's Trading Posts had some great thoughts about high school.
• Hockey Mom seems to have remained friends with all her high school friends. That's the exact opposite of me. Then again that comes as no surprise, since I'm about as far as a Hockey Mom as you can be.

What would you tell your high school self? If you write about it and drop me an e-mail or a comment I'll highlight your story above.

A large number of you leave comments about how well I'm doing each month as I review these income streams. It's very uplifting to me. However, I wonder if it's really a lot of money.

The definition of a lot of money was discussed at The Simple Dollar (TSD). The conclusion that TSD came to was that a lot of money in terms of salary was 50% more than what he currently makes. As he makes more money, his definition of "a lot" changes. This makes sense to me, but I have to say that my income streams is nowhere close to being 50% of my salary.

My alternative income is a source of excitement for me. It seems a little odd to me, but sometimes I feel like I'd be willing to trade $10 from my day job for $1 of money from blogging. I was very confused by these feelings until I read this tremendous article from the Washington Post (if you click on any link to leave this site, make it that one). It would take too many words to give context to that article, but here is the key quote:

"At a music hall, I'll get upset if someone coughs or if someone's cellphone goes off. But here, my expectations quickly diminished. I started to appreciate any acknowledgment, even a slight glance up. I was oddly grateful when someone threw in a dollar instead of change." This is from a man whose talents can command $1,000 a minute.

I don't have that kind of talent at my day job, but I've become conditioned to a fairly high salary.  In contrast, in the world of blogging and alternative income, I've been conditioned to earning very, very little.   I find that life's experiences are in relation to the surrounding context - this is another case of that.

Since I started Lazy Man and Money, the premise behind it would be that I'd figure out smart places to put my money and with minimal effort, it would grow. After all, it is an information age and it seems much more money is made through thoughts and ideas than physical work. The problem is that I simply can't figure out where these places are.

I've figured out the problem though. It's just that the markets are too efficient now. Let's take the housing market, for example. During my parents' generation (baby boomers) and even through the early 90's it seemed as though it was possible to buy a property and rent it for a profit. While real estate is dropping, I haven't seen such a property in years. Maybe with up-coming foreclosures there's an opportunity there, but you can imagine that there are millions of people having the same idea.

In trying to think of other ways to make money, the stock market comes to mind. However, the market is so efficient that monkeys throwing darts tend to do as well as the professionals. The only money to be made there seems to be by buying and holding securities with as low expenses as possible. It's possible that you can time the market and play longer term trends. I've looked into this through some sector plays, but it's still just an educated hunch.

What does this leave me with? It leaves me looking for new markets. By being an early adopter, I like to get in before the market matures and becomes too efficient. This means that I also face increased risk. The best example of this is Prosper.com, an auction house for loans. I see some inefficiency while the membership is small. However, if everyone was a member, lending and borrowing money, I wouldn't be able to take advantage of these inefficiencies.

Have you found any market inefficiencies? If so, how did they work out for you? Do the inefficiencies still exist?

So what would I do if I won the auction? I would show up at the ceremony, accept the ball, and hand it back to him and thank him for the memories. Wouldn't that be really classy? I hope the person that wins the auction reads this and considers doing just that.