I keep getting flack for being cynical on compound interest. I was an engineer in a previous life, and this is amenable to quantitative analysis, here are the charts on why compound interest won’t help you that much to retire early. It will help you a bit. but if you want it to do the lion’s share then be prepared for a nice 40 or 50 year working life.
You know the story of Alice in a Wonderland of Compound Interest. Astute Alice saves £1000 a year from 18 to 38. She then stops work to have children, never saves any more in her pension and retires at 68 on £1M. Lovely jubbly. Cat-brained Camilla jumps to it at 38, and saves £1000 for 30 years until 68 but lives on cat food and baked beans for the rest of her life.
Let’s test this for Sensible Susan who works for 40 years from 21 to 61. Nobody in the personal finance field wants to work for 50 years like Alice 🙂 Warren Buffett tells us that she should expect an annual real return of about 5%. She works in the public sector and never gets any real career progression. To normalise everything I have her saving one unit of real money every year, all these entities live in an inflationless world where their nominal rate of return on capital is deflated by inflation to get the real return. At the end of her career she looks back at how much each tenth of her working life has contributed to her pension. Compound interest sees to it that the early years contribute more, that much is clear, and of the total amount of 120 units accumulated, 67% is compound interest – it triples her money.
She observes that the savings in the first third of her working life contribute half her pension capital, she goes out and tells all the young pups that the first 12 years of savings are the most critical, if she had started at 35 she would be on cat food and beans. Quod erat demonstrandum.
Let’s cast a beady eye at how this compares with the real world:
Susan got no career progression. Let us hear it from the people at the ONS on this subject. The downturn is because everyone took the earnings sucker punch from the financial crisis, I correspond roughly to line 2. Look at how the career paths of people 10 years younger than me leave my cohort for dust[ref]I acknowledge they need that better career progression, to be able to pay for student loans if applicable and housing which is dearer in real terms than back in the day. It’s still an impressive feat and I tip my hat to their superior industry or negotiating power, at least up until ’09[/ref] 😉
I got roughly three times real terms career progression over 30 years, this happens faster now though it may peak earlier, and I did better than the ONS average. It’s not unreasonable to expect someone to save to a pension as a constant proportion of their gross salary. Let’s say Susan got 2 times real terms career progression over 40 years – compound interest still more than doubles her money, it’s 63% of the total of 164 units
Just for the record, this is what this would have looked like for me, getting 3x career progression although that was in 30, not 40 years so I have just taken eight of Susan’s four-year segments, getting 3x career progression over that 32 year time. 52% of my total of 134 units comes from compound interest – it’s doing a hell of a lot less of the lifting than for flatline Susan. But I end up with more 😉
It is the combination of career progression and the shortened working life of FI/RE types that makes compounding a lot less relevant in the real world. I’m not even particularly exceptional here – a 30 year working life is early retirement, not the extreme early retirement, and I dramatically lacked ambition compared to what people like RIT or The Escape Artist were prepared to do to retire early. I would imagine they got more than three times real terms career progression.
Even that’s not realistic, though. There is a problem in humans called hyperbolic discounting, which means when we are closer to something delivering it gets much more interesting. The young Ermine didn’t really bother about pensions, though of course I signed up the The Firm’s scheme – companies were more paternalistic in those days and told you what was good for you. As the concept of retirement hove into view and I got within ten years of NRA I started to divide the tax privilege of 40% by the number of years (10) and saw I would struggle to get that sort of return on cash, and all of a sudden AVCs (a DC type of pension saving) became interesting, so I set to it. Tax savings mean a HRT taxpayer gets a 66% return on net income foregone, compared to the 25% for a basic rate taxpayer. I was lucky enough to be able to save to AVCs by salary sacrifice, so I took some basic rate tax + NI savings which still worked out to about a 50% ROI. The whole thing gets a hell of a lot more interesting. I don’t know about you, but it really, seriously, pissed me right off to be working two days a week for the taxman to I tried everything legit as I started running into HRT – first employee share incentive plan shares, and then somebody introduced me to AVCs and life was sweet. Life is too short to work nearly half for the government[ref]I know, indirect taxes and Tax Freedom Day and all that, you can reduce indirect taxes by not buying loads of Consumer Shit[/ref], a third is okay, more than that, sod that.
I tried to simulate the effect of that by increasing the Ermine’s later savings by 1.3 times, which reflects the better return on net earnings lost that a HRT taxpayer gets. It somewhat underestimates my later savings, I was simply not prepared to pay 40% tax at all after a bit, so any bonuses and pay increases were salary sacrificed to AVCs and in the very last two years I hit AVCs harder driving my pay well below the HRT threshold. But ignoring that and simulating my boosted contributions from HRT alone, the contribution to my savings if I had saved steadily as a proportion of net income is much more even across the eighths of my career –
Compound interest is about half the total 145 units. Unlike for the slow savers it just doesn’t do much for aggressive savers, and I was never a particularly aggressive saver compared to the people who want to retire in their forties!
There’s a takeaway from this all – yes, compound interest will help you triple your savings to FI, if you are unambitious and you want to work 40 or 50 years. It will roughly double the savings of the typical FI/RE saver. Where it really starts to show up is once you have FI and your aggregate savings are significant. Some anonymous dude called Cumulative Dividends has put more money into my ISA[ref]over its ~six year existence[/ref] than I have this year. He appears to be gathering speed with time – in the last tax year he contributed nearly a fifth of what I did. He is one aspect of compounding, there is a similar but volatile and flighty bastard called Capital Appreciation that is the other.
I will not be drawing down my ISA savings for probably another 10-15 years until my final salary pension starts to be eroded relative to other people’s earnings (earnings inflation is usually higher than price inflation) and then I will start to use the tax-free ISA income to top my pension up, and finally start to run the capital down or part-buy an annuity in 20 years’ time. Who knows. Compound interest helps people with capital, but it doesn’t help ambitious early retirement savers to build capital that much, though it roughly doubles the money. As for Alice in compound interest wonderland, well that is Alice in Wonderland – the weakness of that is the unrealistic 10% annual real return. Alice may get that in Wonderland, but you ain’t gonna get that in the real world. Put the work in or put the time in.
You shouldn’t take away from this that you don’t need to start saving to a pension early, all the parts of the pie matter, but you shouldn’t take it as totally devastating if you didn’t start early. If you have any ambition to early retirement at all, the myth of compound interest and the trickle of free money from Time isn’t going to do the heavy lifting for you in the accumulation phase.
I’ve always been the cynic on the practical value of compound interest – while it will probably will more than double the real value of a conventional retiree’s retirement savings by the time they get to retire, it’s not magic. The problem is we don’t live long enough, we don’t work long enough, particularly in the PF favourite occupations of finance and IT, and more to the point, particularly for young folk compared to me, you get some serious career progression which means you can save more money as time goes by.
Money is fungible – it doesn’t matter that your pension pot has £1000 from the £180 you saved when you were 25 with a paltry 20% tax lift, boosted by compounding, or £1000 from the £600 you saved in a month when you were 45 and paying 40% tax. It still adds up the same. All the old saws about Sensible Susan saving for 10 years ‘twixt 20 and 30 before she has kids never to save into a pension again doing better than Erratic Eddie who only started when he was 30 are bollocks unless you assume unrealistically high real rates of investment return or very long working lives. A long working life is something that by definition the FI/RE crowd don’t want to have.
Unrealistic Investment returns
Before you assume a 10% real terms return from investments ask yourself why that slack bastard Warren Buffett is only good for 13% p.a. average, I was wrong here he’s good for 19%. But he says you are only good for 6-7% nominal, 3-4% real. Bear in mind that the sequence of returns matters – take a hammering at the end and it’s worse than taking a hammering at the start. Cautious fellows like RIT are pushing down the safe withdrawal rate below 4%, the SWR is a proxy for the real investment return modified by the sequence of returns risks. Although you are slightly insulated from sequence of returns risk while you ware working (you can always work one more year for comfort and all that) compare to your retired self, assuming you can do better than twice the average real return year on year steadily is making an exceptional claim. You only get the exceptional evidence to back up that exceptional claim just before you retire. There’s no go-around again option by then.
Long working lives
One observation is supportive for this – we live a lot longer now than a few decades ago, possibly up to 10 years longer, and by observation while sitting on our backsides in offices gives us lardy arses the middle-aged of today just don’t seem to carry the burden of musculoskeletal aches and pains of the manual workers of my father’s generation, and arthritis and respiratory diseases are far less common than the middle-aged adults I knew as a child. There is some sample bias in my observation – I grew up in a working-class community but worked and lived in a community of people who didn’t work with their hands, but I would say that in general we are fitter but fatter in middle age than earlier generations.
The trouble is that to have a long working life there has to be work you can and ideally want to do throughout that long working life. I managed 30 years before I got pig-sick of the way the workplace was changing, and I didn’t even work in the those favourite PF occupations of IT and finance both of which seem to burn people out before they clear their forties nowadays. My Dad worked from 14 to 65, over 50 years, I only managed thirty. Anybody who wants to retire early isn’t going to have a long working life, and the value of compounding depends critically on the amount of time it is given to work.
Another problem is that the pace of change is faster now. Experience accumulated over a working life counted for more in the past. Much of what I learned as a young pup is absolutely worthless now – things like timing the studio cameras to be synchronous and in colour phase at the vision mixer is just irrelevant to anything now, though it was handy to know 30 years ago. As such you may have trouble in commanding higher pay later in life in technical fields, although it is still true that leading people is a skill that improves with age. But organisations have flatter hierarchies now, the levels in the pyramid are further apart. And anyway, TEA gives it to you straight between the eyes –
the underlying purpose of work…which was to fund getting the fuck out as quickly as possible.
which sort of goes against doing it long enough for that compound interest malarkey to make the saving easier. Compound interest is the principle behind most people’s approach of only saving less than 25% of their pay to a pension. They get a nice long working life, or suffer an extreme income hit when they stop working.
This is why compound interest won’t help you, FI/RE wannabee
I worked for 30 years, which is an old lag in the FI/RE universe – although I had a decent job it wasn’t one of those finance/IT ones (I did some IT but it was peripheral). Many of you are targeting a 20 year working life, which is a good call, look around your office and ask yourself how many 45 year-olds and up are there? If a normal working life is 21 to 67 these days then just under half your colleagues[ref]you do start to see people die off in their 50s, but it isn’t terribly common[/ref] should be over 45. If you don’t see that many older employees, then don’t count on a long working life in that industry.
Monevator’s compound interest calculator tells me at a real interest rate of 4.5% your starting contributions will be increased to 2½ times their value over 20 years. If you look at the ONS chart you expect to get a tripling of salary over your short career – it took me over 30 years to get the career progression that seems to happen in half that time nowadays. So your increased later monthly savings will probably beat out the value of compound interest on your early monthly contributions. Plus at the moment the old git gets more help/shafted less by the taxman than the young fellow – I experienced this directly, it’s much cheaper to save to a pension with a 40% tax boost than a 20% boost. You still need those early contributions, every little helps and all that, but forget that story of Sensible Susan quitting at 30. The only reason that could work is if she works (ie not drawing down) until she is 67 and enjoys a higher than excepted investment return. That ain’t likely – secular stagnation would seem to be lowering investment expectations, not inflating them. And who wants to work to 67? Not you, FI/RE aspirant.
Who does compound interest work for?
Entities with long investment horizons. Preferably ones that are longer than a human lifetime, because at realistic rates of return on capital, that’s how long you need for it to shoot the lights out. Apparently there’s something called Downton Abbey on t’telly, and The Escape Artist deconstructs the compound interest message from there. Basically get on the side of Capital – either by earning a shitload more money than most but not living an extravagant lifestyle, or alternately get your ancestors to work for your capital and live off the income it generates. Decency would suggest you don’t spend more than the income, so that you can gift your idle spawn the same gift your ancestors handed you. This doesn’t work well in a world of rapidly increasing human population and increased capital from non-human work, specifically fossil fuels, but it worked tremendously well for a lot of human history. Okay, it worked well for the aristocrats, rather than most people.
One of the interesting things in the comments on TEA’s article is where parents try and teach their children how compound interest works. Observe how they have to create absolutely unrealistic accounts where Daddy pays a whopping 10% p.a. interest rate to make the story ‘interesting’ enough to attract any attention. Look at how long you have to go back in time to when the Bank of England interest rates were that much – nearly a quarter of a century! That was a special case when Soros was ejecting Britain from the ERM. And look at when interest rates hit 10%+before in the late 1970s – the Ermine was still at school then. And remember what else happened then – we had inflation running at 27% annually at one point, so that 10% interest was still a dead loss. It’s a totally unrealistic rate, and they aren’t going to get that sort of interest unless all sorts of other shit is going down in the economy at the same time.
Now I know that you often have to simplify and amplify things for pedagogic reasons, because children are simple-minded with short attention spans, but in the end you’re teaching a lie. The difference between 5% annual return and 10% annual return is stupendous[ref]compared to the 2.5 times in the previous example, the Bank of MMM would increase the capital by seven times over 20 years. I’d bank with the Bank of MMM if I could get an account paying twice the typical real return on equities – on cash![/ref]. This is similar to other lies people tell children to make them believe the world is other than it really is, like Father Christmas and the Tooth Fairy. It’s a good story. But it’s not true. You sometimes have to tell children lies like that, but as adults you should have grown out of such fantasies about compound interest in the same way as hopefully you don’t still believe in Father Christmas.
Compound interest, if positive and greater than inflation, can give you any amount of money you want. The catch is you have to wait long enough for it to work its magic, and 20 years is enough for a doubling, but not a tripling, at typical real rates of return of the riskiest commonly available asset class with the best long-term historical performance. Of course a doubling is worth having. But it’s not life-changing. Also bear in mind if you carry any debt at all during your working life then that is compound interest working against you. Debt includes a mortgage – you pay roughly twice the real price for a house in the long run at typical British long-term mortgage rates, which funnily enough, happen to be around the 6% mark. The only thing that makes that acceptable is you’d otherwise be paying rent for that time, and even then it takes a long time to break even.
In comparison, just under a thousand years ago a lot of people accumulated a shitload of capital in the UK, because William the Conk stole it from the previous owners and gave some of it to his mates who aided and abetted the heist. Compound interest worked for them – the aristocracy still owns more a third the land in England, much of which has remained in the same families’ hands for the last 200 years. You’re looking at compound interest at work – it paid for each generations huntin’ and fishin’ and all those servants to make their life easier than the rest of the country.
No wonder that the middle classes, observing the twin forces of automation and globalisation destroying many of the jobs they hoped their sons and daughters would go into, are bitching like hell to get inheritance taxes reduced so they can featherbed their kids against the incoming economic storms. Get on the side of capital. It sure beats the hell out of working for a living, and it’s doubly sweet if you didn’t have to earn the capital in the first place.I mean FFS, let’s make the middle class’s houses IHT free as they peg it so their children don’t need to work to earn the money to buy a house, because when you die you are reincarnated in the form of your kids so they are entitled to it, and anyway, houses are so cheap in Britain that any poor sap who doesn’t get a house bequeathed them by Mom and Pops can work a few years to buy a house. Not.
Compound interest works for old money, because it works very well if you have a time horizon measured in hundreds of years. Become a dynasty, or maybe become a vampire, slumbering in a box for three hundred years until your time is ready, while your Vanguard all-world index fund has been working for you for three centuries. Want to see what 200 years of compounding looks like – take a look at the Rothschilds. You can piggy-back on their investment approach, the only thing missing from the compound interest win is you need to do the whole vampire trick of taking time out while compound interest works for you. Becoming a vampire isn’t the only way, if you build a spaceship in your garage and put the hammer down once you’ve cleared Earth orbit you can slow down time for yourself while Vanguard and compounding do the heavy lifting for you. Obviously you lose your entire human web of life while doing so and won’t know any living person when you come back, but hey, that’s just the price of early retirement using compound interest. You could take your entire nuclear family with you and enjoy your winnings. Best to make sure there really is an Earth/human race/society you want to live in when you come back…
Who else does compounding work for?
People who have accumulated a decent wedge. Young folk always wonder why the greybeards have all the bloody money – they accumulated it over a working life. The corollary of, say, a 5% real return on income is that if you can keep your spending down to less than 5% of the capital then you won’t run out of capital. Unfortunately the only way to get that sort of return is to accept volatility which makes the spending rate indeterminate and statistical, the nominal SWR is lower than the return because the volatility means you either have to accept a variable spending rate or you will be drawing down your capital.
That low compounding rate means you need 20 times your desired annual income even hope to achieve stasis, and as soon as you draw income the compounding will slow, or reverse. If you are spending most of your income on living the middle class dream and sending your kids to public school then you aren’t going to get anywhere – in a 20 year working life you aren’t going to accumulate 20 times your annual spend. You need to seriously earn a lot more than you currently spend, or alternatively spend a lot less than you currently earn 😉 Cutting excess spending punches above its weight, because if you want to increase what you earn keeping spending the same you start to find the taxman grabs an increasing share of what you earn, adding a headwind to your efforts.
The forces that make compound interest are the same ones that pays rentiers and aristocrats (who are rentiers who didn’t earn their rent-seeking capital) an income. It just won’t really help you that much to retire early, if you are a typical FI/RE aspirant. I wasn’t a typical FI/RE guy, by the way – I would have been OK working to 60 if the workplace hadn’t become such a ghastly gamified bullring where form became valued over function. I have since then come to the conclusion that working to 60 would have been a terrible waste of my time, but I had to retire to find that out 😉 That would have been a working life of nearly 40 years, nearly twice the length of the one many PF writers aspire to.
As it was I worked for one and a half times the usual target. And at the peak of my earning power I sweated three years spending at a level that the JRF classified me below the poverty line [ref]the JRF think purely in term of income, not wealth. I entered the income I had left after saving into pension AVCs and ISAs[/ref]
This isn’t easy, guys. There is no Compound Interest Fairy that makes it easier for you. If there were, everyone would be retiring at 40. There’s an argument to be made that if we weren’t such damn fools sinking so much of our earnings into our houses then we might all be retiring earlier, but in the end it didn’t work out that way.
Compound interest is a great story, but a myth at the same time
It’s a fantastic story, that the passage of time gives you free money. What on earth is not to like? Waiting most of your life for that free money! That’s the bit that aristocrats get right – they had diligent ancestors who put the work in or seized the opportunities from others, depending on your point of view. If you don’t have dynastic wealth and want to retire earlier than other people, do something different from other people. Make the difference between what you earn and what you spend bigger, and note that the taxman adds a headwind to earning more but not to spending less.
Compound interest may help you after you retire
Young retirees have a very long time of not working, and they need compounding to keep their capital topped up. Compound interest will do more for them after they retired, because a) they will be retired longer than when they were working, and b) they will start their retirement with a shitload of capital, unlike their impecunious Younger Self when they started saving. I could take a reasonable estimate that I have 30 (slightly optimistic) to 50 (I would be over 100) years left to live- already that would permit me to spend down some of my capital. This effect is allowed for in the Monto Carlo analyses of things like FireCalc and cFiresim. Extreme early retirees have a longer gap to bridge – a 40-year old is looking to finish work less than halfway through life, and indeed less than a third into their adult life. To a first approximation they need to live like aristocracy – aristocrats never spend their capital, they are merely the guardians of the ancestral wealth for the next generation.
I’m a compound interest refusenik on early retirement because the maths doesn’t add up over human-sized periods of time if you come from a standing start. And I’m assuming that most wannabe early retirees are humans, and not aristocrats. You gotta get the capital before compounding will help you. It’s helping me – it has put a fair bit more money into my ISA[ref]integrated over time 2010-15[/ref] than I was allowed to put in this year. But that seed capital came from some of those 30 years of working, not the Compound Interest Fairy.
It’s time we stopped calling anything published or PR sponsored by a company with an interest in the outcome science. We have a term for this sort of thing. It is called advertising. I am not saying that big companies don’t do science – I worked in a industrial research lab, and companies sometimes do publish science in peer-reviewed journals, but it’s always worth asking who pays the piper. Particularly if the conclusion is consuming more of something novel and unnatural is good for you. The Escape Artist gives you a rough guide if the simplicity of Michael Pollan’s Eat Food, mostly plants and not too much is too simple –
Eat as close as you can to what a caveman / cavewoman would have eaten
This means eating real, natural food that used to grow (vegetables, salad, fruit, nuts), swim (fish), fly (birds) and run (red meat)
Do not eat things that were made in chemical plants (e.g. margarine) or factories (e.g. Ready meals, Smash, Custard Powder, Vienettas)
As an Imperial alumnus, I received this stirring letter from Professor Alice Gast, current Rector of Imperial. Heck, it makes even this retired Ermine a little teary-eyed to recall the young pup who started Physics in the dog days of the 1970s
Throughout history universities have been founded with the purpose of creating new knowledge and producing educated citizens. Imperial College London is no exception.
Ah those distant days, when the goddamned market hadn’t grabbed our hearts and minds, when institutions like schools and universities had qualitative human values rather than make the fastest buck we can, ASAP. When governments and universities did the blue sky research she was talking about, and when basic science was paid for by governments, and indeed we were not so solipsistic as to fondly believe that 50% of our children are academically gifted, because it’s pretty obvious that they aren’t, now we’ve tried the experiment. Proust made the distinction between involuntary and voluntary memory with his madeleines in In Search of Lost Time and Alice Gast’s letter was an involuntary memory of this more human and less market-centric time. Though let’s not forget the dreadful draughty cold, the insipid food, unreliable electrical goods and cars and then tremendously racist and sexist attitudes of the time Before Thatcher too!
I’m glad that research is still considered important at Imperial – when I went to university academic research into discovering new stuff and how the world worked was the whole point of a university (in science, I confess I have no idea even now what the equivalent is in the humanities – I was born after CP Snow’s Two Cultures). There was the suspicion that the undergraduates were a bit of a PITA and got in the way somewhat of the real work of the university. Whereas now it seems the point of a university to make shitloads of money out of as many people as possible, some of whom aren’t bright enough to see they’ll never get a return on that investment. This is in the same vein as some other once fine institutions – like the point of a hospital used to be to try and make people better, as opposed to try and stop the marketised and cash-starved company running it going bust, all the while overseen by some prize prick who in other news, wants us to work like the Chinese because work is good for you in and of itself, as opposed to a way of paying the rent.
The scientific method from the Enlightenment to 1980
Anyway, back to science. Science is a methodical process which seeks to determine the secrets of the natural world by using the scientific method. A lot of people miss the boundaries there, which then gives us materialist rationalism – science will never tell us the meaning of what it is to be human, or how to organise our societies or even just plain be nice to each other – these are not its job. Once we have determined the overall aims it can help us with the how, but not with the why. But since I was grouching about the trouble with science now, let’s remind ourselves of the principles of the scientific method, which haven’t really changed that much since the Enlightenment:
Observe the natural world
Develop a hypothesis as to why things are so
Experiment to test the hypothesis
Review if your hypothesis matches observations
repeat – and modify your ‘king hypothesis rather than your observations where there are discrepancies, people
That’s how it should work. But science costs money, all that Wrangling Stuff, and expensive kit, there are always more nooks to poke an inquisitive snout into than there are resources. So we had the Science Research Council to match this and allocate resources. Now we have the market.
The scientific method from 1980 onwards, a.k.a. market driven science
Ah, civil servants shouldn’t be picking winnners. etc, etc. Let the market decide sounded the battle cry in the 1980s. Now I worked in an industrial research lab for a long time. Industry is perfectly capable of applying science, and obviously they get to pick and choose the bits that are profitable or help them make profitable products.
But industry is shit at doing science1, because science is meant to inform us about our world. And industry wants you to buy its stuff. Let’s take the scientific method according to Coca Cola. The Telegraph is there with a repeat for free
Observe your product – water, sugar and flavouring. One of these is bad for people because it makes them fat
Develop a story to sell more of it
Take a partisan view of the world and amplify the reasons to buy your product as opposed to using a common and cheaper alternative – water
if desperate simply lie and falsify results (that’s the VW arm of the decision tree) – in Coca Cola’s case you consumers are fat because they don’t exercise enough, not because they are chugging 35g of sugar per can
shut down all the council-operated water taps in parks and public places[ref]I totally made that up, but WTF, what’s sauce for the goose is good for the gander. Anyway, there used to be working municipal water taps in Britain when I was a child and I can’t recall the last working one I’s seen recently[/ref]
Now ask yourself, did she get to look like that drinking a couple of cans of Coke a day? Probably not…
The Exercise Myth
“Exercise is the key to losing weight”
This is bullshit. It is one of those things that is true in theory but not in practice. In theory you could do enough exercise to compensate for drinking a 330 ml can of Coke at 140 calories, but the truth is that Britons don’t generally do that – you have to walk about 45 minutes. Coca Cola want to sell us more sugary shit, so they tell us exercise is the way to get fit. Well, it helps, but you’re always better off not drinking the Coke in the first place. That’s the sad truth about losing weight – stopping the calories getting into your gob is by far the easiest win. You cannot outrun a bad diet.
Eat less and for God’s sake don’t drink Coca Cola. The retired Ermine weighs less than the in work Ermine. One day I would like to have the same waist size as when I was 21, but it’s going to be a long way coming. Yes, I probably do more exercise than when I was working, but it’s of the order of Mike Evans with occasional bursty peaks over at times
It’s eating less that made the difference, and it kinda just happened. There are all sorts of minor second-order things about life that improve when you control your own time, and it so happens eating less is one of those things. The amount of calories consumed by half an hour’s walking is jack shit, about 120 calories, about a slice of bread. It’s irrelevant – it’s about 5% of the daily calorie consumption.
Exercise over your normal level does use calories, but it hardly shifts the needle on the dial. This was brought home to me when I discovered that the 13-mile round bike trip to work and back consumed less than the 220 calories in a Mars Bar of the time. A man on a bicycle is an incredibly efficient transportation system – the bike journey used about 140 calories. The next problem with exercise is that it makes you hungry, particularly if you are unfit. The exercise only helps you slightly lose weight if you fight that urge to eat more, and don’t even think about consuming sports drinks to replace the calories you worked so hard to try and lose.
We took a big wrong turn in the 1970s when we decided fat was the enemy rather than sugar, because there’s another dark truth – it’s much easier to overeat sugary calories that fatty calories. Let’s take a Coke at 140 calories a can – it is more calorific than beer by volume, so I’d go for the healthy option, better for your teeth, too. Looking at how people use it, it’s not unreasonable to imagine someone getting through four of those in a day, particularly if they are doing some sort of sport 😉 That’s like eating an extra Big Mac that day. If you wanted to eat those 140 calories as butter that’s about a tablespoon and a half, it’s easy to drink two cans of coke in one go but you’d be queasy on three tablespoons of butter. Six? I battle tested this with crackling. The crackling you have to eat first as it comes out of the oven, else it draws water from the air and becomes a soft dog treat. You can only eat about three square inches of crackling before you just can’t physically do it any more. That’s probably 500-800 calories, we aren’t talking healthy living, but you wouldn’t reach the same total endstop after troughing a whole one of TEA’s Vienettas
Now somebody like TFS can make a dent in that 500 calories in half an hour and five miles. But he’s running a bloody marathon, and he’s not your average Brit, who apparently does a lot less exercise than me! I am definitely among the idle bastards of the PF community compared to all those marathon runners and mountain cyclists, and yet despite having never, ever, been inside a gym for my entire adult life I am in the upper half of British adults physical activity by a long chalk
It found that just over 8% of adults who could walk had not – with the exception of shopping – walked continuously for five minutes within the previous four weeks, while 46% had not walked for leisure for 30 minutes continuously over the same period.
Now I’m of the opinion that it doesn’t matter if your walking is for shopping or for going to work or just for the hell of it, and indeed I am a utility cyclist and walker. I walk to the shops, and I walk to the library for instance, but half of British adults not walking for half an hour in four weeks? C’mon guys! Anywhere less than 1.5 miles away is walkable, and a bike more than doubles that. Anyway, if these guys want to lose weight they should start by eating less. And hydrating using water, or tea and coffee, or if push comes to shove drink beer, not Coke.
My mother2 had a simple motto on diets: Friss die Hälfte – eat half. It’s not about what you do eat, just eat less. Having said that, do be careful of sugary stuff, because the energy in it is so concentrated you can trough down a lot very quickly. Take a Starbucks Frappucino with cream and caramel It sounds truly disgusting, and note Starbucks make it pretty hard to find out the calories in their stuff because you have to download a PDF and cross-correlate it, but order any of these in Venti size3 and you’re north of 400 calories.
For comparison a Big Mac is 550 calories, but the thing is, you’re unlikely to be able to chow down two Big Macs in one session, whereas sit in Starbucks for an hour with your iPad and you could quite easily get through two of those.
Let’s take a look at sports drinks. This again is not something I know from experience because a) I have avoided sports ever since school, which made me hate it with a vengeance which hasn’t faded in 30 years and b) such sports drinks as I have tasted tasted like disgusting sugary shit. So I took a look at this from the Guardian as research and came to the conclusion I am on a different planet. I am okay with doing exercise to do something, like chopping wood, or to get somewhere useful cheaply like cycling, or to see something interesting in the case of walking. I can understand going to a gym to lose weight, but to do it for fun beats me. Anyway, apparently a sports drink is there to replace the calories you use while exercising, and here is where I lose the point totally. Why? And when I see a large individual come out from a gym and glug down a sports drink I ask myself WTF are you doing this to yourself?
If you’re Usain Bolt, you may have use for a sports drink. If you went into that stinky gym because you are too fat, then you just paid the sports drink maker good money to sabotage the whole reason you paid the gym operator to go there. The terrible conversion rate of calories to exercise is the reason you feel shit, and feeling shit is the whole point, to rip some of the fat out your lardy flesh, not go replace the stuff you sweated buckets to use up. Just save the money on the gym and the drink and do something else with your time.
Given the level of physical activity of Britons, there is no need for supermarkets to stock sports drinks, because not enough sport goes on to make that sort of demand. Just. Say. No. to fizzy drinks. Oh yes, and parents – don’t do it to your kids. As a measure of how far Coke has advanced, yes I did have Coke as a child – but only on birthdays and maybe Christmas holidays – you can get away with 35g of sugar a few times a year. You just look at the pallets of the stuff in Tesco to see a lot more is being shifted. My mother did me a great kindness early on when she suggested knocking out the sugar in tea (nearly everyone seemed to add sugar to their tea in the 1960s). It was a fight for two weeks, and has served me for getting on 50 years.
The Escape Artist has a nice piece on this – basically follow Michael Pollan on food. I disagree with TEA regarding science that used to be funded by governments – the UK used to have government agricultural and hydrological research labs that published some good stuff which is still to be found in obscure places but since 1980 this is increasingly done by the big ag chemical and biotech firms which seem to have infested Defra, and surprisingly the ‘evidence based research’ so happens to point towards we need to get bigger, more high tech and use GM. Obviously some of these chemicals end up in the watercourses, but hey, some other bugger can pay for that, eh, and we have to ram our big scale factory farm animals with antibiotics to control disease, but again, pfft, your children can deal with the problem of antibiotic resistance but at least you can buy a chicken for £2 so it’s all good.
Keep it simple, and go easy on anything your great grandmother wouldn’t have recognised as food. That includes puffery like vitaminwater which is also brought to you by Coca Cola. The bastards are at it again – adding 65 calories of sugar to every bottle of something marketed as ‘water’.
Coca Cola screwed up selling real water in Britain in 2004. When I was in the US I observed Americans are perfectly happy paying for purified tap water. Now it has to be said that some of the water I got from motel rooms on that trip was worth paying to avoid, but in Europe we are only happy to pay for water if it has been purified from a natural source coming out of the ground. Of which Britain has plenty – every supermarket seems to be able to find a source. Coca Cola decided to try and sell us Dasani purified tap water from Sidcup in south London, and it didn’t go right for them at all.
What is now often reported as ‘science’ is nothing of the sort
The trouble with saving money by not doing science as a country is that you lose impartiality, and increasingly you just can’t tell what the bloody hell is what in a ghastly echo chamber of special interest pleading masquerading as science. It applies in many fields, but nutrition seems to be a particularly bad case – as Scott Adams said, pretty much everything about nutrition and diets is 100% Science Fail. Doing science on living things is hard because it’s difficult to separate the variables, and it’s a lot easier to do science on things like fruit flies that only live for a short time than on a beast that lives for 70 years and gets ornery as soon as you try and control what it does. It’s particularly hard when you’re doing the science like an A level student where you know the result – Coke is good for you – and have to munge the experimental results to give you that answer and ignore any counterfactual evidence. That’s advertising, not science. It’s done by “scientists” working for firms like this
The European Hydration Institute (EHI) was founded in response to the need expressed by a number of scientists, nutritionists and health care professionals, for a one stop shop relating to hydration where: All hydration science and knowledge could come together; strategies for further advancing understanding in the area of hydration could be developed and support for efforts designed to ensure people across Europe are properly hydrated could be provided.
What need was that? If you’re thirsty, drink water, tea, weak beer. How did previous generations ensure people across Europe were properly hydrated? They provided municipal water fountains in the 1960s and 70s FFS. When was the last time you heard on the news that somebody going about their daily business died of thirst in Britain? It’s just not a problem that needs a hydration institute to sort out. There are parts of the world where hydration is an issue. That is what Water Aid is for.
Why can’t we do science any more?
We can. Although there are some who ascribe the dropping of productivity and the return on capital as being due to the wellsprings of science and technology running dry, it does still go on. The problem is that the quality control department has downed tools and gone AWOL. So much crap is being published that you can’t tell the science from the puffery, and because even those doing research are incentivised by publications and citations we get exactly what we incentivise – these are bright people, after all. We get loads of publications and citations, but unfortunately nobody is making any more time for people to keep up with this or referee the papers properly. The signal stays roughly the same but the noise increases.
Companies have jumped to the fact that the modern creed is science but few people can actually recognise science, so they are incentivised to create spurious rubbish that looks like science, and since everybody needs to pay off their student loans they can hire scientists with the right credentials to write claptrap that looks like science and pollutes the scientific literature and tell us great big porky pies like that you can exercise your way out of eating too much. Marion Nestle (author of Big Soda) has been collecting sponsored studies and their sponsors and has found that 95% of the results favour the sponsors. How, er, tremendously odd that is. Looks like it is game, set and match though – a 95% confidence interval is a commonly accepted benchmark of a clear result, so yes, sponsors do fix the results of their studies, either by selective hypotheses or by more nefarious means. The piper really does call the tune. I’m shocked.
For what Rogoff is saying is that if we are experiencing technology stagnation, it’s not because humanity has suddenly become less innovative. Rather, it’s because incumbent interests now have the biggest incentive ever to impose artificial scarcity, which is stopping the speed of innovation.
One of those artificial scarcities incumbents need to create is in information. It’s become much easier to disseminate information, so they do it by flooding the information space with false information. It’s a propaganda war – all advertising is propaganda along the lines of We want to make You buy Our Shit and Believe Our Story. There aren’t any principles beyond the love of money, so if it’s bad for you then we start with propaganda to make you believe the bad effects are due to something else you’re not doing, and dress it up as science.
In 1886, Coca-Cola® brought refreshment to patrons of a small Atlanta pharmacy. Now well into its second century, the Company owns more than 500 brands which are enjoyed in more than 200 countries. Innovation and solid science are the foundation of everything the company does, from the development of new sparkling beverages, juices, waters, sports drinks, energy drinks, coffees and teas, to the environmentally-friendly packaging and refrigeration equipment and the new (and the world’s largest) plastic-bottle-to-bottle recycling plant and other actions to support recycling in the U.S.
The Coca-Cola Company is committed to advancing scientific knowledge, awareness and understanding of beverages, and recognises the importance of an active, healthy and balanced lifestyle. Initiatives like the “Beverage Institute for Health and Wellness” are part of this commitment, serving as a valued resource for health professionals and others worldwide on the science, safety and benefits of beverages and their ingredients, as well as the importance of diet, nutrition and physical activity to health and wellbeing.
The Coca-Cola Company is also committed to local markets, paying attention to what people from different cultures and backgrounds like to drink, and where and how they want to drink it. With its bottling partners, the Company reaches out to the local communities it serves, believing that Coca-Cola exists to benefit and refresh everyone it touches.
The Coca-Cola Company has been instrumental in supporting the establishment of the EHI. It is providing funding to the EHI as part of its commitment to a better scientific understanding of human hydration and related societal issues.
That’s huge, for those of us who don’t frequent Starbucks. It’s a pint. When was the last time you drank a pint of coffee at home? I have never, ever, seen a reason to buy a large coffee unless there are two of you and you want to split one ↩