The Cosmological Paradigm

Although modern cosmological ideas aren’t quite set in stone, an overall paradigm has emerged. IMHO it is rather seriously flawed which is perhaps why there isn’t quite the consensus in modern cosmology as say in some other areas of scientific inquiry, such as Darwinian evolution or the standard model of particle physics. In any event, the following current Cosmological Paradigms (CP) are stated then if necessary rebutted by myself (JP).CP – The Big Bang Event is attributed to be / explain the origin of our (note: not “the”) Universe.JP – No issues here and there are three lines of actual observational evidence that support and back this up. 1) The Cosmic Microwave Background Radiation; 2) the chemical abundances of hydrogen, helium and lithium; 3) the Doppler redshifts exhibited by distant galaxies that relate the shifts with galactic distance. The greater the shift, the greater the distance.CP – The Big Bang Event happened roughly 3.8 billion years ago – give or take.JP – I have no issue with this dating.CP – There was no before the Big Bang Event.JP – This is just an unproven assertion and there are various scenarios that postulate a before the Big Bang Event. I’d postulate that of necessity there must have been a before the Big Bang Event on the grounds that according to the First Law of Thermodynamics matter / energy can neither be created nor destroyed. Therefore the Big Bang Event could not have created matter / energy and therefore matter / energy existed prior to the Big Bang Event.CP – The Big Bang Event was a micro-sized (pinhead) happening. That is to say the entire contents of our Universe were jammed together inside a tiny volume in the beginning. This is deduced by running the expansion rate of our Universe back to just Nano-seconds post the Big Bang Event.JP – Cosmologists can’t actually see the embryo Universe until roughly after 380,000 years post the Big Bang Event. That’s because the Universe was just too opaque to have photons escape. That’s akin to how photons at the centre of our Sun just can’t immediately escape and make themselves known.Further, there is absolutely no justification for running the clock back to just Nano-seconds post the Big Bang Event. There’s the expanding balloon analogy. Consider the filming of an expanding balloon and calculating the expansion rate. Then run the clock backwards until the balloon was the size of a pinhead. You could do it, but it would be fallacious and unjustified. The same would apply to extrapolating a nuclear or dynamite explosion back to a nanosecond post said explosion and concluding that the A-Bomb or the dynamite stick was then the size of a pinhead.Finally, if the contents of our Universe were once jammed into a volume the size of a pinhead, you’d have a singularity. And while cosmologists talk about a singularity at the Big Bang Event that implies that there must have existed the Mother of all Black Holes and this there could not have been a “Bang”, big or otherwise. Thus, the Big Bang Event happened in a volume of space that was large enough to avoid the formation of that Mother of all Black Holes; way, way, way larger than the size of a pinhead.CP – The Big Bang Event created all of the Universe’s matter and energy.JP – There is no way to demonstrate, even in theory or by use of a theoretical equation(s) the creation of an absolute something (which matter / energy is) from the state of an absolute nothingness. It’s absurd and prohibited by the First Law of Thermodynamics as noted above. Matter and energy must have existed prior to the Big Bang Event.CP – The Big Bang Event created both time and spaceJP – This is just about as bogus as it gets. Since time and space have no actual structure and are composed of no actual substance, neither can be created – except within conscious minds. Time and space are just mental concepts and constructs. Now the concepts of time and space are dependent on the existence of matter and energy. Time for example is just change and change is just motion and something with structure and substance has to exist in order for there to be motion. So if matter and energy existed before the Big Bang Event, then so too does the concept of time and space, again something that minds envisage since time and space are immaterial concepts.CP – Because the Big Bang Event actually created space, there was no centre to the creation of our Universe.


JP – The Big Bang Event did not create space. Space is an immaterial hence mental concept. Space has no structure and is composed of no substance. Anyone who claims otherwise has to actually identify what that structure is and what that substance is. IMHO, the alternative is that the Big Bang Event happened in already existing, or preexisting space. Thus, there is indeed a centre that exists as the centre of the creation of our Universe. However, that centre has so now cooled off to the temperature of the rest of the Universe that it can no longer be identified as a unique point.Further, the directions of all of the expanding galaxies in (not on) space doesn’t in and of itself identify the centre since each galaxy would have to identify itself as the centre since all other galaxies are moving away from every other galaxy (local galactic clusters excepted of course).CP – The Big Bang Event created an absolute something (our Universe) from an absolute nothing.JP – This, yet again, is in total violation of the First Law of Thermodynamics (noted earlier) which states that matter / energy can neither be created nor destroyed. Thus, yet again, there was a before, a previous material existence prior to the Big Bang Event.CP – The Big Bang Event was apparently immediately followed by a very brief period of very rapid inflation. Inflation is required in order to account for various observational features the Universe has. These observations centred on: 1) the horizon problem; 2) the flatness problem and 3) the monopole problemThe horizon problem – contact between two regions – is a problem in that if you look at exact opposite regions of the Universe; you tend to see pretty much the exact same thing, especially when it comes to temperature. Well, in order for things to achieve equilibrium, requires that the two regions be in relatively close proximity since the exchange can only happen at velocities equal to or less than the speed of light. If two opposite areas of the sky, looking deep into space, are the same temperature, it requires that these two regions were once close together, close enough for equilibrium at or less than the speed of light to have taken place in order to even conditions out. Unfortunately, the distances observed between opposite points in the sky are such that uniformity could not have been possible. They are now out of contact with each other – beyond each other’s ‘horizon’ so any bits of non-uniformity between regions that eventuated way back when should have persisted – and when we look that deep into space we are looking way back when. We need some serious additional oomph to get uniformity between regions from way, way back then (i.e. – immediately post Big Bang Event) out to currently observed distances.The flatness problem revolves around the observation that the Universe is fine-tuned with respect to the density of matter and energy contained within, a density that has resulted in a just so ‘flat’ universe. Translated, a flat universe is one where Euclidian geometry holds sway (the three angles of a triangle add up to 180 degrees). Now if the density was greater, the Universe would be closed, like a sphere (i.e. – the Earth), where the angles of a triangle on the surface add up to more than 180 degrees. If the density were less, the Universe would be an open (i.e. – saddle-shaped) hyperbolic Universe where the angles of a triangle add up to less than 180 degrees. If you have a potentially wide range of possible densities, it’s amazing that our Universe has that just-so flatness.The monopole problem is that under the conditions of the Big Bang, one should have generated monopoles – magnets with either a north pole, or a south pole, but not both. Alas, no monopoles have ever been detected or observed. They appear to be rarer than hen’s teeth.Well, the way to circumnavigate those problems is to propose not just an original Big Bang Event explosion, but an additional super-ultra ‘explosion’ that speeded up the expansion of the Universe, ever so briefly, by a very, very, very large factor indeed. This secondary ‘explosion’ was termed “inflation”. Inflation made the expansion rate of the Universe caused by the Big Bang to appear almost insignificant.So how does an extreme, but brief, burst of expansion (i.e. – inflation) solve the flatness, horizon and monopole issues?The horizon problem is solved by inflation. While, initial pre-inflation Big Bang conditions would have provided for the required close enough contact to achieve uniformity, regions flying apart would soon acquire their own distinct ‘personalities’ and be far enough apart that equilibrium could never be restored between these regions, even at light speed. However, that additional serious bout of Inflation then rapidly expanded out that evenness, Inflation providing the extra oomph and freezing the uniformity in place to the distances we observe today.The flatness problem is explained because an extremely rapid rate of inflation would smooth out the Universe. If you’re bacteria on the surface of an uninflated balloon, you’ll see peaks and troughs – wrinkles. If that balloon is blown up thousands of times greater in extent, the surface will now appear flat – just like the surface of the Earth appears flat to us.The monopole problem is solved because the volume of the Universe increased thousands of times over in nanoseconds such that monopoles were now dispersed over an incredibly large volume such that the odds one would be in our cosmic neighbourhood becomes vanishingly tiny.JP – Inflation is just an ad hoc way of explaining away various anomalies that would arise if only there had just been a “Bang”. Other than the lack of these anomalies, there is no observational evidence that this brief burst of additional post “Bang” inflation. Another point of contention is what came first, the Big Bang Event chicken or the Inflationary egg? That’s not clear depending on what cosmological model you adopt. Also, I never really understood why you need BOTH the Big Band Event AND inflation. Why not just combine the two into one brief but violent Ka-Boom.CP – As a result of the Big Bang Event creating space, space in and of itself is expanding and carrying the cosmic flotsam and jetsam piggyback style along for the ride.JP – The rather awkward question is, if space is an actual something that has substance, what is space expanding into?By the way, there is no actual observation that can be currently made that can distinguish the flotsam and jetsam of our Universe be carried on space as opposed to travelling and expanding through space.Further to the point and in any event, the Michelson-Morley experiment in the late 19th Century (1887) disproved the idea that space was an actual something, at that time referred to as the “ether”.CP – The expansion rate of space is now accelerating.JP – Where is the necessary energy for that observation coming from? It takes increasing amounts of energy to cause increasing rates of acceleration. After all, our Universe was born with only a limited finite amount of matter / energy. That finite amount can’t be further increased as if by waving a magic wand.CP – The energy for this observed acceleration is called “Dark Energy”.JP – And nobody has a clue what “Dark Energy” actually is. Attaching a name to something isn’t in and of itself an actual explanation for what it is or why it is or how it came to be.Further, if “Dark Energy” is all pervasive, then “Dark Energy” should be around each and every one of us right now. “Dark Energy” should therefore be readily accessible for in situ investigation – ditto “Dark Matter”. Both “Dark Energy” and “Dark Matter” aren’t just OUT THERE somewhere, but here, there and everywhere. Alas, that reasoning hasn’t resulting in cosmologists being any the wiser.CP – Expanding space creates “Dark Energy” and “Dark Energy” expands space thus creating even more “Dark Energy” in an ever circular pattern.JP – That’s a free lunch / something from nothing scenario. IMHO there has to be an alternative explanation that accounts for the apparent acceleration rate of our Universe’s expansion rate. Two things come to mind. The first is that astronomers / astrophysicists don’t understand Type 1-A supernova as well as they think they do. Type 1-A supernova were the standard candle that was used in determining the acceleration rate. Secondly, if the speed of light has not remained constant over cosmic time, that would throw a monkey-wrench into the works.CP – The Energy density of our Universe is constant even though our Universe is expanding.JP – The obvious conclusion is that therefore something (energy) is constantly being created out of absolutely nothing in total violation of the First Law of Thermodynamics. It’s a waving the magic wand scenario.CP – Based on current observations, it would appear that our Universe will keep on keeping on expanding forever, resulting in an eventual “Heat Death” or cosmic “Big Rip” where “Dark Energy” will ultimately tear everything macro apart down to the micro fundamentals.


JP – That would appear to be the case – based on current observations and understandings that is.Summation of JP cosmology:Basic premise – The Big Bang Event happened in preexisting space and time and did not create matter / energy, nor was it a micro-sized happening. The (our) Universe is expanding therefore through space and not on space.*The container we call “space” (actually IMHO preexisting space) extends as infinitely in all directions as makes no odds. No matter how far you travel into space, you can travel further.*In this infinite cosmic expanse, universes are born (Big Bangs) and expand. Further, all universes share the same laws, principles and relationships inherent in our physical sciences.*Since matter / energy can neither be created no destroyed, there has to be recycling going on at the cosmic level; on a cosmic scale, since otherwise time and entropy marches on and universes age and like good soldiers, just fade away.*However, the problem arises that if our Universe is going to expand forever and ever, amen, then how are the materials therein going to get recycled?*Lets first take a step back. There’s a lot of recycling that takes place in our own Universe. Lots of ordinary stars, even like our own Sun, spew out stuff – sort of like taking the recycling bin out for eventual collection. I mean things like the solar wind and coronal mass ejections. Other stars spew out more of their guts (nova) or even large amounts of their innards (supernova) into interstellar space. All of this expelled stuff contributes to an ever increasing amount of interstellar gas / dust which when dense enough, under gravity, contracts to give birth to new (2nd, 3rd, 4th, generation) stars. As an example, our own star is believed to be a 3rd generation star.*Analogous to stars spewing out their innards (as expanding star-stuff), we have an expanding Universe. But in ‘infinite’ space what if one expanding universe starts to intersect another expanding universe(s) Maybe the now increasing density is sufficient to cause gravity (as in the case of interstellar gas / dust becoming new stars) to strut it’s stuff. One get a local contraction into a quasi-Big Crunch. It has to be quasi since the contraction has to avoid the Black Hole / singularity scenario.*Anyway, old universes, like old stars, recycle into new universes. That’s true whether it be via a quasi-Big Crunch or if even instead a Big Bounce (see below), you still end up with a new (even if not improved) expanding universe.An analogy:Take the following analogy: There’s four cars all heading east, west, north and south respectively that’s leading to an intersection. The distance from the car’s front bumper to the middle of the intersection is exactly 60 miles. If all four cars travel at exactly 60 mph, it’s going to be one almighty Ka-Boom at the intersection. But if the four cars travel at 58, 59, 60 and 61 mph respectively, there will be no Ka-Boom at the intersection. The Ka-Boom is the analogy for a collapsing universe creating a singularity – the Mother of all Black Holes – and thus eliminating any possible new Big bang. The Big Crunch that avoids the creation of the Mother of all Black Holes is analogous in the same way as the four cars travelling at ever so slightly different speeds avoided the four-way crash at the intersection.Another possibility is that what if the four cars are akin to super-magnets? Front bumpers are positive north poles and rear bumpers are negative south poles. So the four cars that are just about to collide in a Big Crunch don’t because their collective magnetic repulsions stop their motion then repelled the cars backwards and away from each other – a sort of Big Bounce. This might be analogous to how electrons are seemingly repelled from crashing into and entering the nucleus of their atoms or akin to the Pauli Exclusion Principle which prohibits lots of electrons from cramming into the same ‘orbit’.

Why India Is A Great Place For Hiring Virtual Employees

If you are searching for an incredible solution for your business, you have to procure an employee with right skill & talent. With globalization leveling the world, it has turned out to be progressively essential for organizations to use outsourcing firms in India to remain focused. The incredible information technology based virtual employees from India serves you with animating solutions for empowering your projects. India is the best outsourcing destination for technical work, when compared to other outsourcing areas in Eastern Europe, the Pacific Rim and Latin America.Here are few reasons why India is a great place for hiring virtual employees for your organization:Cost-EffectiveMoney is at the center of all explanations behind outsourcing. India has turned out to be the most cost-effective. Labour costs in nations, for example, US, UK, Australia, Canada and Dubai are tremendous when compared to India. A lower cost directly has an impact and increases the ROI. Rather than employing in-house workforce, offices like to outsource their business to Indian companies which give them committed virtual employees which would work precisely like in-house assets will work for the offices abroad. It offers adaptability, as well as decrease in capital expenses, infrastructure and maintenance costs by a considerable margin.CommunicationSeamless communication is another reason that these countries lean towards India more than any other counties. Viable communication is the most imperative factor for better execution of plans and strategies. Indians are known to communicate in English superior to their Chinese or Filipino partners.


Access To Skilled WorkforceOutsourcing business to India encourages access to skilled assets with a lot of experience. It has the most astounding number of talented assets in sectors, for example, IT, BPO and Finance to name a few.India additionally brags upon the greatest involvement in dealing with basic activities without breaking a sweat. Accessibility of talented workforce at reasonable pricing is good to beat all for the offices situated in US, UK, Australia, Canada and Dubai among others.Advanced Infrastructure & Latest TechnologyIndian agencies intensely concentrate on the arrangement of the most recent of technologies and infrastructure. Moreover, training the workforce on the most recent upgrades is at the core of their strategy. They lead preparing programs all the time to guarantee their employees are at the highest point of their diversion constantly the time. This helps Indian firms take into account the demanding needs of overseas clients and execute critical projects in a consistent way.India’s Outsourcing Friendly PoliciesOutsourcing business is one the principle source of foreign income for Indian economy. Hence, India’s outsourcing approaches are adaptable encouraging overseas companies outsource their business to India in a hassle free way.From $US 50 billion out of 2010 to $ US 118 billion out of 2016, India’s development in outsourcing is massive. The insights plainly recommend that while India’s policies are viewed as favorable for outsourcing, accessibility of skilled resources at low expenses again settles on India as the best decision for outsourcing.Productivity & Better Customer SupportOutsourcing expands profitability and customer support. Both of these elements are imperative to effectiveness and 100% consumer loyalty which likewise brings about repeating business.Round the clock customer support, regardless of time zone contrasts and extraordinary charge over English likewise helped India move up the step in a limited capacity to focus time exceeding every single other countryIndia Offers Better Pricing FlexibilityThe plain truth is that American labor is costly-and ought to be, given that the average cost for basic items is high compared to most of the world. In addition to each staff member’s salary, there is the cost of taxes, medical coverage, liability insurance, computers, work place and much more, depending upon the perks you offer. The average range for a decent developer can be somewhere in the range of $50 to $80 an hour for a full-time staff member (depending upon skills and experience). Contrast this with the hourly cost of a developer in India, which can be brought down to as low as $15 every hour for an experienced staff. Pricing flexibility enables you to be substantially more inventive in dealing with your spending when you can’t bear the cost of higher-priced staff.


India can help you focus on core business competenciesAs your business develops, you will need support for your expanding client base or research and test new items while continuing your current growth rate. Dealing with everything in-house may remove your concentration from core business activities. However, hiring virtual employees from India can empower you to designate noncore activities while you keep on managing the business functions that make you effective. India is a versatile outsourcing location, where you can without much of a stretch discover a service provider for customer support, research, marketing or any other business activity that you would prefer to outsource.Outsourcing to India is simpleBeginning with outsourcing to India is as simple as finding an appropriate Indian service provider and signing an outsourcing contract. In any case, you should find a way to guarantee that you outsource just what you can deal with.

Why Are So Many People Interested In Their Rights, But Not Their Responsibilities?

In today’s world, it is not uncommon to hear someone talk about what their rights are or how their rights are being taken away. This is the type of thing that one is likely to hear if they use social media or go to a university, for instance.The Point of FocusThe people who are like this are often only concerned about what the world owes them, meaning that they won’t even think about what they owe the world. Here, someone is going to be focused on receiving.The other side of the equation, giving, is then going to be completely overlooked. It could then be said that someone like this will have a strong sense of entitlement, which is why they are behaving in this manner.One FactorWhat can define whether this behaviour is seen as acceptable can be how old the person is who behaves in this manner. For example, if a young child was to talk about what they want and how they want to be treated, it is going to be somewhat normal.For one thing, a child is going to be dependent on other human beings, so it won’t be possible for them to do a lot for themselves, let alone others. Their body and their mind are still going to be developing.A StageThis child will be at stage in their life when they will need to receive in order to grow and, once this has taken place for a little while, they will be in a position to give to the world. At this stage of their life, their parent/s will owe them things.


It is then similar to how a lot of work will need to go into building a house, with this being a time when the house won’t be able to give anything back. But, once it has been built, it will give far more than it needs.A Different ScenarioHowever, if a young adult was to behave in this manner and didn’t pay attention to what they need to give; their behaviour can come across as being extremely self-centred. One is then no longer going to be a child, but they will be behaving as though the world is their parent.This is going to be a world that is made up of individuals – individuals who have their own needs – as opposed to people who are there to fulfil their every need. Their time to purely receive from others and to give very little in return is well and truly over.A Big DifferenceTheir time as a child would have been a time in their life when they were entitled to special treatment from their parent/s, but this is not how life works now that they are an adult. Now, this is something that a lot of adults are going to realise.Through being this way, it is likely to make it easier for them to handle the moments when they are not treated as they would like to be treated. They are generally going to see life through the eyes of an adult not a child.A Cover UpStill, when someone is more or less obsessed with their ‘rights’ and what the world owes them, it can be hard for them to see what is taking place. The reason for this is that someone can create the impression that they are on some kind of moral crusade and/or say that they are being oppressed.In certain cases, someone might be in a position where they are being treated badly, but it won’t always be this black and white. What also needs to be looked into is why someone would end up in a position where they are being ‘oppressed’.For ExampleNowadays, someone can identify as being part of a certain group, for instance, and through being part of this group they can claim victim status. It can then be seen as totally acceptable for them to talk about how their rights are not being respected and for them to oppress others in the process, amongst other things.Based on how they behave, it can be as though they have paid a lot of money for something and they haven’t received anything in return. So, through being completely consumed by what they are not getting from the world, they could be completely oblivious to the effect that they are having on the world.One of BalanceOne is then not going to be able to put themselves in others peoples shoes and to think about what their views are. They might have identified as something, for instance, and they will then expect everyone on the planet to treat them in a certain way.


On the surface they can talk about what they deserve and how oppressed they are, but underneath all this can be the need to control others. With this in mind, how many people who talk about how oppressed they are just traumatised people who feel extremely powerless?The ReasonIf someone feels this way at a deeper level, it could be a sign that they didn’t receive what they need when they were growing up. This could have been a time when they were abused and/or neglected.Ergo, as they didn’t receive what they needed during this time in their life, they now expect other adults to give them what they parent/s couldn’t give them. And through being emotionally undeveloped, they won’t feel ready to give anything back.ConclusionWhat this shows is that someone will often look towards other adults to give them what their parent/s didn’t give them – their unmet child won’t have disappeared. Taking this into account, there is the chance that a lot of the people who are obsessed with their rights didn’t receive the kind of care that they needed during the beginning of their life.If one can relate to this, and they want to grow up emotionally, it might be a good idea for them to reach out for external support. This can be provided by a therapist or a healer.

Compensation Issues

It is well known that the subject of compensation can be very difficult. That is why it is worth using the help of compensation offices, which will greatly simplify the process of claiming benefits due. Very often it happens that the injured have a big problem with Insurance Companies. This applies especially to collisions or traffic accidents. Insurance companies almost always lower the value of benefits paid. Fighting alone is not always effective and carries with it a lot of challenges. Preparing appealing letters, cost estimates, collecting medical records, etc.Unfortunately, all this is necessary to properly justify your arguments and undermine the arguments issued by the insurer.


The biggest problem concerns cost estimates prepared by insurance companies. These are not always reliable and reliably priced. Instead of the original parts, insurers offer cheaper substitutes of inferior quality. The same applies to the lowering of man-hours rates. It is averaged instead of relying on rates on the local market. Unfortunately, this is not the end of problems. Another matter is depreciation, which means lowering the value of parts, depending on their consumption at the time of the event. Of course, all these elements are listed in the cost estimate, but not everyone can handle his reading.The compensation case is not only about communication events. An equally serious problem is faced by people injured in accidents at work, in agriculture or on an unpaved sidewalk. Also in these cases, insurers very often do not pay full compensation amounts. Here it is worth noting that in addition to reimbursement for, for example, treatment, purchase of medicines or commuting to the hospital, victims are entitled to redress, and therefore a special benefit, which is intended to reward the pain and suffering resulting from an accident. Insurers very often avoid payment of these services in an adequate amount.


For compensation, all invoices and bills must be prepared. To obtain redress, documentation prepared by a psychologist will be necessary. The more documents we prepare, the higher amount of money we get.Due to this, a lot of people decide to support compensation law firms that take responsibility for claiming damages. In most cases, customers do not bear initial costs, and only settle after winning the case. It should also be added that the compensation amounts won with the help of lawyers are usually much higher. It is worth taking into account the help of experienced people.

5 Financial Considerations For Future Homeowners

Since one’s house, is, the single, biggest, financial asset, for the vast majority of people, doesn’t it make sense, for potential homeowners, to consider, recognize, and evaluate, some of the relevant financial considerations? Obviously, a potential homeowner should have a professional look at, and evaluate, his credit worthiness, and what adjustments, and/ or steps, should be made, prior to pursing their house. This article will attempt to briefly examine, consider, and discuss, 5 financial considerations, qualified, potential home buyers, should seriously look at, because their future enjoyment, of the home, of their dreams, might be impacted, by some of these factors.1. Down – payment: Depending on many factors, the percentage needed, for a down – payment, in order to secure a mortgage, may vary. We generally consider the conventional amount to be 20%, which means, if the mortgage, being secured, is, for example, $500,000, they will need to put down, $100,000. Remember, the more the down – payment, generally, the better the interest rate/ terms, and vice versa. In addition, what one must pay, every month, is based on how much, is being borrowed, and, therefore, one should consider his personal comfort zone!


2. Other, initial out – of – pocket monies, needed: When one closes on a home, there are many closing costs, the new homeowner, will experience. One is reimbursing the existing owner, for the remaining amount of oil, the amount of prepaid taxes (including real estate taxes, etc). Another is the escrow payment, lending institutions generally require, which includes prepayment for items, such as, generally, approximately, 6 months, real estate taxes, insurance, etc. Don’t forget, your attorney fees, title fee, title insurance, etc.3. Mortgage payment – related: Remember, your monthly mortgage payment, will include principal, interest, and escrow (including taxes and fees, insurance, etc). A future homeowner must examine, what monthly amount will he feel comfortable with, not only what he qualifies for. When this is not considered, we often witness, what we call, House – poor!


4. Other monthly costs: Besides your mortgage – associated monthly costs, there will be other recurring expenses. Your utility bills, will include heating, electric, a reserve for maintenance and repairs, etc. Be prepared!5. Emergency/ contingency/ reserves: The best way to prepare for unforeseen challenges, is to commit, every month, to paying into, a reserve fund (separate account), which you accumulate, yo prepare for contingencies. These include emergencies, shortages, contingencies, repairs, and renovations, as well as the necessary, planned maintenance and upkeep!Will you prepare for future financial considerations, related to home ownership? Are you up to that commitment?

How to Trade in Currency

Trading in currency in other words also known as foreign exchange is the world’s largest financial market and was the area in which world’s largest financial institutions were involved. Earlier the Forex transactions were of biggest concern of the big corporate houses, however as the time changes the need for foreign currency has made its way through corporate houses to individuals who are involving in some sort of international transactions. Though the volume of transactions and the people involved in currency trading is increasing exponentially, still there is an information asymmetry between the investors and the market. Thus, to mitigate the information asymmetry and to provide the individual investor all the required information, let’s look at few basic things need to be paid attention,


• Currency trading market Vs other markets: All the other markets in the entire world are having a regulating authority who keeps a note of every transaction happening within their vicinity. But in case of the currency market, there is no such regulating authority or mediator who keeps a check of all the transactions. Transactions between parties happen through pre-arranged credit agreements. These ad-hoc arrangements are known for providing liquidity requirements of the institutions and individuals.• Immateriality: Trading in currency market literally doesn’t involve any kind of physical transfer. All the transactions happen online without any involvement of physical currency. All the gains and losses are calculated and netted in respective currency accounts.• Intermediation: In the currency market, there is no formal intermediation due to which there is no place for any sort of broker or agent. As there are no intermediaries there is no question of commission. All the gains and losses are individualistic and are the results of one’s own deeds.Above mentioned are the few basic aspects that are needed to be known by everyone who is participating in currency markets to mitigate the information asymmetry and to avoid the risk of loss. Besides, above as we all know the transactions in currency markets always happen in pairs of currencies. The value of the currency in pairs is decided by the purchasing power of the currency in the respective markets. There are certain pair of currencies that are considered exotic in the world’s currency market and they are,


• Euro/ US Dollar
• US Dollar / Japanese Yen
• Britain Pound/ US Dollar
• US Dollar / Swiss FrancThe above-mentioned currencies are currencies of the world’s strongest economies thus making them more precious and expensive across the globe. Not only these combinations, any above currency in combination with other currencies out of this pairs trade in highest volumes in almost all the Forex markets.

A New Domestic Accounting Model based on Domestic Well-Being

Summary of Rationale and Technical Introduction

Other articles on Domestic Well-Being Accounting (DWBA) have hinted about the new ideas upon which this new domestic accounting model is based. In this article, the rationale, ideas and concepts are summarised, based on the coverage in a new book ‘Accounting for a Better Life’.

Accounts

At its simplest, an account is just a list of transactions relating to some area of financial activity or interest. The most familiar form of account is the bank statement that customers periodically receive from their bank.

The first important thing to appreciate is that accounts are for accumulating information about value. We are so used to bank and credit card accounts which are all about currency that people sometimes do not realise that accounts are equally useful for accumulating transaction details relating to, for example, our home, our car(s) – one account for each car – our investments, etc.

Accounts will usually have two columns, one for increasing (+) amounts and the other for decreasing (-) amounts.

The next important concept is to appreciate that there are two distinct, overarching types of accounts that we can use in our sets or books of accounts. One is called an asset account and the other is a liability account.

The asset type account as its name infers, typically relates to storing transactions for assets such as bank accounts, houses, cars, etc. The idea behind this is that positive amounts entered into the + column of an asset account signify increasing value; so £500 entered into the + column of an asset account implies an increase in value of £500. However accountants will also have in their business accounts, what I call working accounts for home accounting, as other accounts of the asset type which are not strictly for an asset such as a car or home. Examples include accounts for asset acquisitions and for depreciation.

That other overall type of account is a liability account. It is used for accumulating debts and/or liability. Now we have the reverse concept in that increasing amounts e.g. £300 in the + column of these types of accounts imply more debt or more liability, whilst a decrease of £200 represents less of a debt. You might think more debt means less value but it all depends on the purpose for which a liability account is being used. Again, accountants mostly use liability type accounts for holding true debt amounts but again, have a need for other accounts of the liability type to mediate certain transactions. I refer to these as working accounts in home accounting as they do not relate to any true debts of a person or household; examples of these are for accumulating temporary information about asset acquisitions and growth in the value of a home.

Another area for confusion here relates to the names for column headings used in the different software packages available to support accounting; in business, the convention is that debits (the + column for asset accounts and the – column for liability accounts) are traditionally in the left-hand column of each account, with the credits on the right (the – column of asset accounts and the + column of liability accounts). This convention is not always adhered to in some software packages, together with not always using the headings, debit and credit.

Double Entry and the Accounting Equation

The last bit of theory to mention which lies at the heart of DWBA accounting is so-called, double entry. This concept appears confusing to people because it has two aspects. First, it is an accounting concept which relates to an approach for taking into account (there’s an appropriate phrase!) all the financial aspects of some financial entity. In business, an entity might be a department or a division, a sole-trader or even a whole plc. For domestic accounting, such an entity would most often be an individual or a household. The point is that the accounts supporting any of these entities consider or model the totality of the financial aspects of the entity. As such, the accounts will be able to capture and make visible both the static and dynamic aspects of the entity finances. The practical effect is that a set of double entry accounts (the books) requires an account to store the total financial value of the entity as well as usually, some accounts for accumulating periodic changes in terms of increases and decreases to this overall value. The result is what is termed a balanced set of accounts, related to an accounting equation.

The other common use of the word double entry is related to the bookkeeping techniques for implementing this form of accounting which requires two (double) entries in the accounts for each new transaction, in order to maintain the required balance.

What do we mean by balance? Well balance is the key to double entry and it comes from balances in accounts, as maybe related in some way in this equation; the so called accounting equation.

If we consider a household, it might consist of a collection of assets – a home, a car, three investments and a consolidated bunch of unspecified appliances. We could set up 6 accounts to represent all these assets and assuming there were no liabilities of the personal debt sort – an unlikely assumption – we could say that our domestic wealth equals the sum of the balances of those 6 asset accounts. Here is a statement, which is not yet a true equation:

The sum of all Asset a/c balances = our Domestic Wealth

Now if we had some debts, perhaps a mortgage on the house and a loan for the car, we could set up two more accounts (of the liability type) to hold these two debt amounts.

Since we owe two amounts for these debts to some financial organisations, we have to earmark the appropriate amounts to be repaid from the value of our assets, in order to derive the changed new value of our domestic wealth, so we can show this in another statement:

All Asset a/c balances – All Liability a/c balances (of the debt type) = our Domestic Wealth

The crucial point about the double entry system is that we need to setup an additional account in order to store the amount of our changing domestic worth. I call it a Domestic Wealth account.

Now, instead of a statement, we have an equation which is balanced:

All Asset a/c bals – All Liability a/c bals (of the debt type) = Domestic Wealth a/c bal

The next issue is what type of account do we need to hold the domestic wealth – asset or liability?

When you think about it, the amount of the domestic wealth represented by the assets less the debts is owed to the eventual beneficiaries of the household or individual’s estate. It should therefore logically, reside in a liability account.

Now we can tidy the equation up by putting all the asset type accounts on one side with all the liability type accounts on the other; the result is with appropriate changes to the signs:

All Asset a/c balances = All liability (debt) balances + the Liability (DW) a/c balance

Let’s imagine a situation where an individual starts up with £20,000 in a bank. For that individual to establish a double entry accounting system, we need an asset account for the bank account and since there are no debts, just a domestic wealth account; a double entry is required for the initial transaction, with £20,000 debited to the asset account for the bank and the same amount credited to the liability account for domestic wealth. In the accounting equation, we can see the result as:

Asset a/c bals £20,000 = All liability (debt) bals 0 + Liability (DW) a/c bal £20,000

Let’s see how we handle buying a car with a loan of £2,000. By breaking it down into steps, we first consider receiving a loan – so receive (debit) bank with £2,000 and setup a new liability type account for the loan company and credit it with the same £2,000 – with this effect in the equation:

Asset a/c bals £22,000 = All liability (debt) bals £2,000 + Liability (DW) a/c bal £20,000

Still balanced at £22,000 on each side!

Now we buy the car for £7,000 using the £2,000 from the loan and the extra £5,000 from the bank assets. We also need to setup a car account to receive the value of the purchased car. The end result from the equation perspective is still a balanced equation:

Asset a/c bals £22,000 = All liability (debt) bals £2,000 + Liability (DW) a/c bal £20,000

The asset a/cs are now made up of Bank (£22,000 – £7,000) and car a/c £7,000 with no change in overall value on the asset side but a distribution in values across the asset accounts.

Another thought about double entry is that any single entry made to a balanced equation (set of balanced accounts) must unbalance it! The only way to retain balance is, from the maths perspective, if we add something to an account on one side then we must add the same amount to an account on the other side; or if we add something to an account on one side we must reduce by the same amount, in an account somewhere else on the same side. This in effect, if you work it out, is what the accounting rule says in that a debit posting must be balanced with a credit posting.

As we buy food, drink and clothing, pay utility bills and purchase holidays, we will see reductions or credit in our asset account for bank or, if we pay by credit card, equivalent credit entries to increase our debts in the liability type account for each credit card. These are termed expenses and will lead to an equivalent decrease in our domestic wealth. It should be obvious that if we post credits as the first part of each expense transaction, we will need corresponding debit entries to balance them. Increasing debits imply an asset type account so that will be the sort of account that we need for these increases. By the same logic, income such as salary or pension will be first entered as increases or debit entries in our bank account and must be balanced by credit entries in a new account for domestic increases – increases that are credit entries occur in liability type accounts so this is the sort of new account we need to setup for accumulating changes for increases to domestic wealth.

Non Double Entry Accounting

Traditionally, accounting for personal and home use has not made use of the principles of double entry; and the software packages that support home accounting are not usually geared up to properly support it. The reason is partly because when people ventured into home accounting, they tended to start with activities such as reconciliation of checking accounts and simple budgeting. For this, they tended to only require setting up accounts for one or two areas, mainly related to bank accounts. With this, as useful as it is, there is no concept of seeing the total picture, with the static and dynamic views of the financial state of affairs.

Business versus Domestic Accounting

When I first decided to start ‘doing’ my own home accounts many years ago, I believed that since business accounting had evolved over such a long time to be able to so successfully satisfy business managers’ needs to manage business finances (and there was a legal requirement for them to do so) there must be something special in business accounting that I could look for, to be able to help people better manage their personal and home finances. As described elsewhere, I discovered that business accounting methods themselves were of little help because of the wrong focus (profits for capital gain) and that the actual accounts, reports and associated business ratios were also, understandably, entirely inappropriate.

In thinking about alternatives, I realised there were some features that could be extracted from business and with modification, be used effectively to help manage home finances.

Reports

With the double entry system we can obtain a static view or ‘snapshot’ of the state of the finances of a business and this is called a Balance Sheet. This shows the assets, liabilities and capital value on any particular day.

Most of the entries in the business Balance Sheet come from balances in the accounts which can be easily extracted from a Trial Balance which is simply a list of all the balances for all the accounts in our books.

The structure and contents of the Domestic Balance Sheet (DBS) highlight the major components of the domestic assets and liabilities in order to derive the new value of Domestic Wealth. Rather like the net profits being brought into a business balance sheet, the domestic version shows the Total Domestic Change (TDC) as the contribution to Domestic Wealth over the past period.

Now, the important issue is what does the TDC consist of? We probably know that the business equivalent of profit or loss is exposed in the two accounts – the Trading account and Profit & Loss account. These two accounts highlight the dynamics of the financial situation; the changes over some period.

For business, the focus is on profits and so these accounts concentrates first, on the higher level aspects of the business with opening stock, the purchases made to augment this stock and the closing stock value.

The next account called the Profit & Loss account shows the impact of other increases and decreases which usually reduce the gross profit to some lower value, called the net profit.

The individual accounts required by business have no place in home finances as we are not primarily interested in profit.

The new Focus – Domestic Well-Being

What should the financial focus be for a home finances? Well I gave much thought to this and over some years and developed a new focus with an associated approach and methods, based on what I eventually termed, Domestic Well-Being.

In short, yes, homesteaders do want to increase their worth or value, but not usually for ‘profits sake’. People want to increase their wealth to pay for things that tend to occur in a progression throughout a lifetime; like better homes, education perhaps, hobbies, luxuries and provision for those retirement and eventually, declining years when income is drastically reduced.

In general, home finances in the earlier years of a lifetime are such that there is never enough to go round. Everything is a question of priorities and balance. What should be the best distribution of our expenditure to ensure that we can obtain the best possible balance or compromise, with the income at our disposal?

My solution was to come up with a structure that best presented the major areas of domestic finances about which decisions could be made on how best to allocate funds – those alternatives and their prioritisation. So I needed a way that could be used to classify increases and decreases as and when they occurred, as well as for presenting the figures in an appropriate way after they had been accumulated. This presentation had to support the decision making that would be needed to best optimise future spending. It had to be done in a way that could achieve this best balance across the competing priorities so as to maximise Domestic Well-Being. It was therefore DWB that became the new focus for domestic accounting; and it could be identified in terms of a structure for both bookkeeping – capturing the transactions; and accounting – reporting, analysing and the subsequent decision making for future financial activity, implemented perhaps through budgeting.

The Domestic Well-Being Statement

The Domestic Well-Being Statement (DWBS) is the domestic version of the Trading account and the Profit & Loss account and is used to present the derivation of the Total Domestic Change (TDC) over some period. It represents the second of my adopted features from business accounting.

This report simply shows the structure for DWB and is obtained in Microsoft Money with one click to run a pre-stored report. The edited version combines the details for the current and previous years to assist with comparisons.

In summary, the report shows the three top-level Categories of the structure as the Basics, Discretionary and Others groups of transactions, each divided into Increases and Decreases. These categories might be considered as similar to business accounting nominal codes.

Within these groups there are successively lower level groups of sub and sub-sub categories. For example, the Basics included Essentials, Responsibilities and Family, each with further sub-categories below.

The Discretionary group, where obviously there is some amount of discretion or choice as to whether decreases and increases occur in its component sub-categories, includes Nice-to-Have, Investment for the Future (IFF) and Luxuries.

What amazed me when it was first developed was the fantastic visibility it provided on the home finances, especially showing the distribution and makeup of the many expense items.

Financial Ratios

The third feature that I adopted from business accounting is the use made of financial ratios.

You will appreciate that a ratio is simply a comparison of two figures expressed as a quotient, usually in decimal or percentage format. In business over time, certain key quantities and their comparison in the form of ratios have taken prominence as a key to both information dissemination (for shareholders, investors, management boards, auditors etc.) and to various levels of management as a basis for control. Those two components of a ratio, the numerator and denominator, can both be considered as candidates for achieving change.

Over 30 business ratios slim down to few that most people have heard of, such as the different forms of margins and the ratios associated with profitability and liquidity; and of course virtually none of them relate to home finances!

From my experience, I knew that the figures I had exposed for domestic finances must have some potential for assisting in the management and control of home finances. The issue was which figures and in particular, which groupings of pairs of figures as ratios might be informative.

The Stages of Domestic, Financial Life

My other experience was with life; now 68, I realised looking back on my lifetime of interest in home finances, I could distinguish six fairly distinct stages of financial life. By this, I mean that there was a significant enough change in some aspect of personal finances across the stages that might warrant some form of indicator or measurement being useful. For your interest, I call these stages:

Early Adulthood

Early Maturity

Middle Life

Retirement

Declining Years

I have defined five primary factors and a number of secondary factors for domestic finances, changes in which I believe, have a correlation with those stages of financial life and could be useful as a basis for comparison and more detailed analysis.

The Domestic Financial Factors

Briefly, the more important ratios over some period are (where the abbreviations relate to figures in the DWBS):

Basic Cost of Living Factor (BDD/THI) – a measure of the amount spent on basic necessities, out of total household increase.

Well-Being Contribution Factor (DDD/THI) – a measure of the amount spent on discretionary extras, out of total household increase.

Future Affordability Factor (IFF/TDI) – a measure of financial commitment to future well-being, out of total domestic increase.

Feel Good Factor (IFF/DDD) – a measure of how much went on future well-being, out of total discretionary decrease.

Domestic Wealth Factor (TDC/ODW) – for positive TDC the domplus, or for negative TDC the domicit, contributing to growing or diminishing domestic wealth respectively, as a proportion of old domestic wealth. This is the nearest comparison to business profit or loss.

To start with, lacking any reservoir of accumulated figures, the value of these ratios or factors as I call them for home use, will only be of use internally in a household over time, as a means of measuring and looking for changes. With a base of figures, then there would be the possibility of comparison with others and the similarity to business norms.

Value for these five factors give ‘shape’ to a financial situation and if displayed in the format of a star or radar diagram, could also offer useful indicators that could help to predict problem areas or states of stability or instability about a set of finances.

With an accumulation of values for the domestic factors, either by simulation or by capture after creation by individual home owners, it would become feasible to create and provide further useful charts. With such information, the home owner would be able to determine if the individual figures from the accounts appeared to lie within the expected domestic norms.

Other Graphics

A picture speaks a thousand words. This is no truer than when considering displays of financial information. Such graphical charts are the fourth set of business features of the sort of products that can easily be created with general purpose accounting software packages such as MS Money, especially if double entry accounting is used.

Financial Control

For home finances, control is both feasible and realisable and is only limited by the extent to which homesteaders wish to go. It all comes back to a need for a sense of responsibility.

The analysis should first look at distribution and balance. Are the proportions being spent on the Basics a fair amount compared to the total increases?

The information obtained from your end-year results should reveal some fundamental facts. Have you been able to afford anything over and above the basics? If yes, did the amounts enable a reasonable allocation to discretionary decreases; and what about luxuries?

Your accounts and this new set of accounting methods will give you the data and information to enable you to pick up warnings.

What sort of warnings might you want? In today’s climate of a financial debt crisis, probably the most important warning you would look for is one relating to the likelihood of such a pending crisis for you. You would want to know if your decreases are getting too close to your increases, or even exceeding them. You would want to know if your reserves are being depleted, possibly on funding that excess of decreases over increases. You should be looking to see the amount of short-term and long-term liabilities you have; and how their proportions compare to the total value of assets. You would want to know about your liquidity; how well you are able to realise funds in the short term to meet your known commitments. You obviously do not want to sell your house or car just to pay the bills.

On a less dramatic but more important note, you need to know about the proportion of contributions being made to future well-being; and if positive, does the amount being put aside represent a reasonable proportion of your increases?

Conclusion from Adapting Business Accounting Concepts

In order to implement the features I have extracted from business accounting, I needed to be able to use the concepts of double entry.

Simplification

In undertaking home accounting with double entry, the main difficulties related to knowing where I was in relation to individual accounts and the entering of transactions. By this, I mean that when looking at a single account register on the computer screen, it never appeared obvious to me what sort of account I was looking at and into which column of the account, the next posting should be made.

Over time, I realised that the key to understanding the answers to this dilemma lay with the accounting equation. I needed a way to always be able to associate any account with its place in the accounting equation – asset or liability – and to which account it should be associated in order to achieve double entry balance.

Like many amateur accountants I often had problems with reconciling the concept of debts in accounts for mortgages and loans, with a so-called liability related to an amount in a capital or domestic wealth account. To me, domestic wealth was a ‘good’ liability – more was better – whilst the mortgage and loans were ‘bad’ liabilities or debts that had to be repaid; and more was not better, but worse! I resolved this by considering all the accounts that were associated with domestic liability as quasi-liabilities – good liabilities; the amounts or the balances of liability held in these accounts, I considered as ‘good’ liabilities. They were given the letter Q in the appropriate prefixes.

There are a total of four accounts that fell into this quasi group which consisted of the Domestic Wealth account (LQ DW), the Domestic Changes account (LQ DC), the Categorised Increases account (LQ Cat Inc) and the Categorised Decreases account (AQ Cat Dec).

The majority of the changes to domestic wealth over any period come from the decreases associated with expenses such as food, drink, clothes, utilities, holidays etc – virtually all of the Basics and Discretionary decreases. These also end up in the LQ DW account via the LQ DC account but because of the way I handle most of the double entry postings, they arrive via those two quasi accounts for Categorised Increases and Decreases.

Implementation

I initially chose one of the earliest versions of a generalised accounting software packages called MS Money. Being generalised, it provided the capability to create accounts as needed, with any name you chose.

It also had good integrated query and reporting capabilities, together with the concepts of payees, categorisation tags and support for budgets as well as for stocks and shares.

In thinking about the implementation of double entry, MS Money was not designed primarily for double entry. If it was, it would have some journal-like arrangement similar to dedicated double entry accounting software, whereby each transaction is associated in some way with the two accounts involved in the double entry. Then, via a key-click or later batch updating, the two individual postings would be made to the appropriate two accounts.

This does not mean to say however that this software package cannot be used for double entry postings. All it requires is that after adding the necessary extra accounts, that two entries are posted for each transaction entered.

One form of categorisation available in MS Money is its Income and Expense tags. Money comes pre-loaded with tags associated with home finances so that for example, with a simple account (non-double entry system) for reconciliation with bank statements, each transaction could be associated with an appropriate tag, such as wages, food, etc.

Income and Expense are the terms used in MS Money to relate to the accounting terms of debit and credit; Perhaps trying to be helpful to home accountants, MS Money has differing column headings for the increases and decreases across all the various types of accounts that can be created.

In trying to find a way to implement the tagging I needed to associate transactions with the DWB structure, as well as achieve double entry to support the concepts of static and dynamic reporting, I came up with a method that achieved both; without the need to enter transactions with hundreds of double postings.

The 1st halves of the appropriately, categorised double entries accumulate in the accounts where they were entered, mostly bank or credit accounts but that is unimportant. At the end-of-period by running a single report, the sum of the amounts of the 1st half entries can be easily exposed, contributing separately to increases and decreases to domestic change. By then entering just two more postings, one for the total of the 1st half increases and another for the total of the 1st half decreases, balance is re-established.

Summary of the Approach

The main features that I have adopted from business accounting are the ability to create balance sheets for static views, to capture the financial changes over a period for the dynamic aspect, to define ratios/factors as a comparison of useful and significant figures from the balance sheet and the changes, as well as the use of graphical reports to enhance visibility and meaning.

As a thought about setting up your own DWB accounting, my book describes the background and theory, together with the details and prototypes for accounts, categories, reports and graphics on a bonus CD, for implementing the accounts on MS Money.

Regarding implementation on dedicated double entry accounting software packages, I have not yet discovered any that are sufficiently general-purpose to enable the creation of accounts of your own choosing, together with your own details of categorisation.

As a final thought on simplification, life in the accounting world can be made much easier for domestic accountants, if the terminology is simplified as much as possible. It will be important not to remove too much of the distinction between some of the technical words but I have found that I have made life much easier for myself, by simplifying, wherever possible.

An understanding of one idea – double entry – and the following, six key words, will get you through with flying colours: asset, liability, debit, income, credit and expense; and my version of the domestic accounting equation, account prefixes and a couple of ‘memory joggers’, will tie all these features together.

Also, take a look at the author’s website on Domestic Well-Being Accounting, together with sample products and a growing list of tutorials at www.dwba.co.uk; the full rationale and technical introduction with supporting charts and graphics is at:

http://www.dwba.co.uk/pages/DWBA_Technical_Introduction.htm