Tesla full-self-driving tackles the bikes, pedestrians, and general chaos of Cambridge

by philg

My April trip to Maskachusetts included a couple of trips within Cambridge in a new Tesla Y with FSD (see The Trump- and Elon-hater leases a Tesla Model Y). After lunch at Happy Lamb Hot Pot in Central Square, the owner, a mutual friend (pilot, $5 million townhouse owner), and I piled into the miracle vehicle for a trip to Micro Center, an Ohio-based chain that is one of the things I miss about Cambridge (the closest store to Jupiter is in Miami, which is to say… not close). The Tesla was almost immediately faced with the challenge of a one-lane one-way road with parked cars on both sides and a cyclist on a non-e-bike. An impatient human might have squeezed past the bicycle, but the Tesla wisely waited until there was a gap in the parked cars on the right and the cyclist moved over.

The Tesla navigated around a couple of delivery trucks that were stopped in right lanes.

The car navigated to a bizarrely back corner entrance to the Micro Center parking lot, drove behind the Trade Joe’s, and then found itself a parking space with empty spots on either side. Thus ensued the apparently mandatory 2-minute denunciation of Elon Musk as a person, e.g., for allowing non-compliant speech on X, tempered with praise for the engineering achievement of FSD.

On the way to my old condo, the Tesla got flummoxed by an SUV that was parked almost in the middle of the (standard Maskachusetts practice). There actually was enough space to squeeze by in the opposite-direction lane, but the owner had to take the wheel and press on the accelerator. Tesla’s software had dealt beautifully with pedestrians in crosswalks, but trying to turn right from Harvard St. there was a confusing situation. A guy in a wheelchair was waiting to cross the side street. The Tesla, just like a human, was waiting for him to cross. I envisioned the Tesla and the wheelchair attendant getting tired of standing still at the same time and a collision enusing. The attendant waved us through and the Tesla FSD seemed to undestand the hand gesture (not my imagination, apparently). The car tried to park in the driveway to the right of the condo, which has three unmarked angle parking spots. That seemed like a recipe for disaster so the owner selected a curbside dropoff instead.

Overall impression: very impressive, but also rather terrifying not knowing whether the machine was going to run over the wheelchair user. Maybe there needs to be a soothing voice repeating “trust the process”?

Speaking of what happens when our AI overlords meet the Boston-area roads… a friend here who drives a late-model Kia gets frequent alerts from the car about his drunkenness. When he swerves around the numerous potholes, the car thinks that he’s impaired. Google AI:

A 2021 federal law (HALT Drunk Driving Act) mandates that the National Highway Traffic Safety Administration (NHTSA) require new passenger vehicles to be equipped with advanced, passive drunk and impaired driving prevention technology by roughly 2027–2028. The technology will detect impairment—via alcohol sensors or behavioral monitoring—and prevent vehicle operation, though the final rule is delayed due to technology readiness, privacy, and accuracy concerns

Kia is ahead of the mandate!

In other driving news, I broke into my neighbor’s apartment and took the keys to her 2014 Mini, which she leaves sitting for months at a time while she’s in California. The car has 90,000 miles on it and won’t die, though many important systems have failed and the check engine light was lit. BMW’s engineering is rather impressive in that the car is virtually impossible to stall no matter how incompetent one is at driving a manual transmission. Backup cameras became mandatory in the U.S. in 2018 and it was alarming not to have one in the Mini. As compensation for this tech loss, I was treated to a continuous diet of NPR news while driving the car. What did I learn?

  • high gas prices have reduced consumer sentiment to the lowest it has ever been since 1952. This was a 20-minute segment on the ills of high gasoline prices without a single mention of how the end-of-April prices are actually lower in both real and nominal dollars than what Americans were paying in 2022 and no mention of NPR’s previous climate change alarmist and calls for carbon taxation to make fossil fuels more expensive. (Separately, are the University of Michigan geniuses behind the poll confident that, from a consumer perspective, things are worse than after the 2008 collapse? Than during the 22 percent misery index (inflation+unemployment) during the Jimmy Carter administration?)
  • when Democrats are back in power they need to force companies to continue to pay health insurance when workers go on strike. But really we need universal health care and universal taxpayer-funded child care so that union workers can strike for months or years if necessary to get what they’re owed as a consequence of AI.
  • there is an important a PBS series about the “often-overlooked history of Muslims in the United States” (“19 young Muslims went out for plane rides in beautiful weather on September 11, 2001”?)
  • Trump wasn’t being attacked for political reasons at the White House Correspondents’ dinner, but rather because there has been a rise in the amount of “gun violence” overall in the U.S.; Democrats and Republicans are equally likely to resort to violence, but the Democrats are generally shooting while the Republicans have subjected Democrats to “verbal violence”.
  • climate change is bad, but the muscular intelligent government of Maskachusetts is ready, e.g., with doors that will seal off the Blue Line MBTA tunnel from the airport (“If the Great New England Hurricane of 1938 were to happen today, AccuWeather experts estimate the total damage and economic loss would reach $440 billion”; maybe this is why my friend with the townhouse pays $20,000 per year for insurance and rates are yet much higher on Cape Cod?)
  • Michael Tilson Thomas, a symphony conductor who had just died, was a “pioneer in the gay rights movement” because, after moving to San Francisco, he was open about having a male partner (Thomas moved to San Francisco in 1995)

[What were gas prices at the time of the NPR Boston broadcast vs. in 2022? CBS: “The current average in the state is $4.16 for a gallon of regular gas, AAA said on Thursday. … The record high for Massachusetts is $5.05 back in June of 2022”. What if we adjust $5.05 June 2022 dollars to today’s mini-dollars? Gas cost about $5.95 April 2026 dollars in Maskachusetts during the Paradise Years (TM) of the Biden-Harris administration.]

With the withdrawal of federal tax dollars and substitution of money from rich progressive Democrats (example), the content of NPR seems exactly the same!

Loosely related… what if you hate Elon Musk and Donald Trump so much that you’re willing to drive yourself (“manually”!) while saving the planet via purchasing an EV of epic expense? A friend in Cambridge did just that. His Lucid Gravity has some nice features, but it can’t be parked next to a standard-height Maskachusetts curb without severe door damage on opening. Every time he parks and someone in sitting on the right side, he must use the touch screen to tell the car to jack itself up to maximum suspension height. After that, a door will just barely clear the curb:

I assume the idea is that those who save the planet are so elite that they never have to park on the street.

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Real estate lawyer competition among our AI overlords

by philg

As part of preparing my old Harvard Square condo to turn over to its next owner, I decided to look at not only the smoke detectors in the unit (2019, 2023, 2023), but also the hardwired smokes in the common stairwell and basement. A disturbing pattern emerged in which the hardwired smoke detectors may have been made in 1990(!). I asked four LLMs to figure out who should pay for the new detectors and the insane installation cost charged by an immigrant Brazilian.

Prompt:

Here are our building’s condo docs. There is a common stairwell serving just three of the four units. The smoke detectors in the common stairwell must be replaced. Is that a condo association expense or something that the three unit owners served by the stairwell msut pay for? (when the building was first divided, there were originally only two units on the stairwell side, but one was further subdivided, so now we have three)

Grok handled this well.

The replacement of the smoke detectors in the interior stairwell (the one serving Units 2A, 2B, and 3) is the expense of the owners of those three units only—not a full condominium association/common expense shared by all four units (including Unit 1).
This is explicitly addressed in the recorded amendment to the Master Deed that subdivided the original Unit 2 into Units 2A and 2B (document I0myQ / the one titled “AMENDMENT TO MASTER DEED OF THE 5-7 IRVING TERRACE CONDOMINIUM” that re-recorded a full updated Master Deed, Book 320806, Page 337 et seq.).
On page 17 of that amendment, under the additional provisions / Exhibit-type language dealing with exclusive easements and rights of use, it states (in relevant part):
“12. The interior staircase serving Units 2A, 2B and 3 shall be for the shared exclusive use of said Units and shall be maintained at their expense so that Unit 1 shall not be responsible to pay for such maintenance.”

Gemini gave a similar focused answer.

Based on the Master Deed and Condominium Trust documents for 5-7 Irving Terrace, the cost of replacing the smoke detectors in that specific stairwell is the responsibility of the three unit owners served by the stairwell (Units 2A, 2B, and 3), rather than a general condo association expense.

Gemini’s answer was inferior to Grok’s because it failed to cite the page number in what is a long doument.

Claude’s answer was longer-winded and more confusing than Grok’s or Gemini’s. Claude made the idiotic suggestion of hiring a human lawyer to deal with the question of how to divide up spending an amount, even after absurdly overpaying a Brazilian immigrant handyman, that was less than what a lawyer would charge to provide an answer.

Based on the condominium documents you’ve shared, this is a common expense paid by the association — but with an important nuance.
The 1990 amended Master Deed (the controlling document, which superseded the original) addresses this directly. The interior staircase serving Units 2A, 2B, and 3 is designated for their “shared exclusive use” and is to be maintained at their expense, so that Unit 1 is not responsible. However, the staircase itself and its fixtures are part of the common elements of the building.
Here’s how the relevant provisions interact:
The stairwell is a common element. Building entrances, entrance halls, stairways, and all related systems are explicitly listed as common elements under Section 5 of the amended Master Deed. Smoke detectors wired into the building’s systems would fall under conduits, wiring, and utility facilities — also common elements.
The maintenance cost allocation is split. Under Exhibit C of the 1990 amendment, the interior staircase serving 2A, 2B, and 3 is maintained at the expense of those three units, not Unit 1. Unit 1 is explicitly carved out.
Practically speaking, the smoke detectors in that stairwell would most naturally be treated as a shared cost among Units 2A, 2B, and 3 — not a general common expense chargeable to all four units including Unit 1. This is consistent with the “shared exclusive use” framework: the costs follow the benefit.
The proportional split among 2A, 2B, and 3 would likely be based on their respective percentages of common interest (14.585%, 14.585%, and 33.33% respectively), though you could also argue for an equal three-way split given the stairwell serves all three equally regardless of unit size.
I’d recommend confirming this interpretation with a Massachusetts condo attorney, as I’m not a lawyer and the documents have layers that accumulated over 40 years of amendments.

ChatGPT, Esq. failed spectacularly.

Short answer: almost certainly a condo association (trust) expense, not just the #5 side — unless your documents or wiring show something very unusual.

It provided about two pages of additional text, none of which referenced the relevant section of the Master Deed.

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Bostonians blame Trump for their biotech slump

by philg

Nearly everyone in Boston expressed hatred for President Trump v1.0, despite the fact that 2017-2020 coincided with great economic times for the city and state (the final year of Trump’s first term wasn’t so great due to the self-inflicted wounds of lockdown and school closure). Now that the Massachusetts biotech industry is sagging, they’re blaming President Trump 2.0,

First, are the good times over? The Wall Street Journal says that they are:

Massachusetts experienced a slight decline in its roughly 65,000 biotech research-and-development jobs in 2024 after years of mostly strong increases, including during the Covid-19 pandemic, according to federal data. The numbers indicate that job losses continued through at least June, while hiring remains sluggish.

By the end of September, nearly 28% of greater Boston’s laboratory space sat empty, according to the latest estimates from real-estate firm CBRE.

Folks in Massachusetts who decry inequality are especially upset that some federal money is being spent in places that aren’t as rich as Massachusetts:

“Every stage of the life cycle has been impacted by policy or regulatory uncertainty this year,” said Kendalle Burlin O’Connell, chief executive of MassBio, an industry trade group. The impact has hit startups especially hard, she said.

A continued downturn poses risks for a region where workers will put up with sky-high real-estate costs if they can land high-paying jobs. Massachusetts faces competition from other states and China, which are eager to peel away talent and investment.

“There are states and countries chasing us every single day,” Gov. Maura Healey said in an interview.

On the federal front, the Trump administration has terminated tens of millions of dollars in active grants in Massachusetts this year, according to Grant Witness, an independent group of researchers tracking grant terminations and reinstatements by government science agencies.

Also, while Massachusetts gets the most National Institutes of Health funding of any state on a per capita basis, changes are afoot. The NIH announced a strategy in November to promote “broad distribution and geographic balance” by spreading around future research funding.

(Does the governor have any experience in building or attracting businesses? It is unclear. “Massachusetts’ Attorney General Maura Healey becomes 1st lesbian elected governor in U.S.” (state-sponsored PBS) doesn’t explain the governor’s background other than “she is lesbian”.)

A friend who is a senior administrator at Harvard was spewing venom at Donald Trump in April for “cutting NSF funding” and thus destroying Maskachusetts. I refrained from pointing out that Congress sets NSF funding levels, not the president, no matter how much of a hater he/she/ze/they might be. Instead I asked her why she expected Boston biotech to stay on the gravy train given that Boston biotech hadn’t developed any drugs that are significant to the average human. She responded with “CRISPR”. I refrained from pointing out that most of the work on CRISPR was done at UC Berkeley and in Europe (the Nobel winners were Jennifer Doudna (Berkeley) and Emmanuelle Charpentier (variety of European institutions, including Max Planck, which has a single American outpost… in Jupiter, Florida), but did note that there isn’t any widely available treatment based on CRISPR. She said that there would be, but for Donald Trump’s interference.

I did ask why she expected Boston biotech to continue standing under the money shower if Boston hadn’t developed any of the recent blockbuster drugs. I said maybe investors, including NSF, would keep pouring money in if Boston-based companies had developed Ozempic. She corrected me: Ozempic was developed in Boston (ChatGPT says it was developed by Danes in Denmark working for Novo Nordisk; related drug Wegovy is also from Novo Nordisk; related drug Mounjaro was developed in Indianapolis by Eli Lilly). It occurred to me that today’s Boston Soviets have a mental attitude just like our charicature of 1970s Russian Soviets, i.e., any failures can be blamed on outsiders (the U.S. for 1970s Russians; Donald Trump for Bostonians in the 2020s) and any inventions worldwide can be attributed to heroic local Soviets.

Maybe Boston-based companies developed whatever class of drugs whose sales were comparable to GLP-1 ($75 billion/year)? The last time the pharma world had something of similar value was with the statin, discovered by Akira Endo at Sankyo in the Japan section of Boston and turned into an FDA-approved pill by scientists in the Rahway, New Jersey section of Boston at Merck. (I’ve always been a statin skeptic, incidentally; if a blood test shows high cholesterol because a human is fat and sedentary, a pill that changes the blood test result without changing the fat/sedentary problem doesn’t seem like it will lead to immortality.)

ChatGPT on inflation-adjusted NSF spending, showing modest growth during Trump v1.0, a bump during coronapanic, and a sag that began during the Biden-Harris administration (money was diverted to supporting migrants?):

The Harvard employee’s focus on NSF might be misplaced. Consistent with the WSJ’s reporting, it seems to be NIH that funds more biotech. NIH’s total research funding is about $27 billion, much larger than NSF’s entire budget. NIH will fund clinical trials and NSF won’t.

Given that Americans were so passionate about avoiding death from disease during coronapanic, while remaining indifferent to being killed in car accidents (imagine the lives safe with my 35 mph computer-enforced speed limit!), from lifestyle choices such as consuming alcohol and marijuana all day, etc., it surprises me that NIH funding hasn’t doubled, in real terms, since 2017. Maybe the explanation is that the entitlement/welfare/migrant-welcoming systems consume all of the growth in government spending.

Probably the real explanation for the Boston slump is that the boom was too good to last, as one WSJ source said:

“There was so much money that the sector got overbuilt,” said Alexis Borisy, founder of Boston-based Curie.Bio, a biotech venture firm that has raised more than $1 billion for early-stage biotechs. “If there was a good idea, there’d be 10 companies all built at the same time to go do it.”

It’s still interesting to me that Bostonians felt that it was their right to claim an ever-expanding share of federal tax dollars and of GDP, despite not having delivered any medications that improve the average American’s health or life. The Righteous of Maskachusetts are quick to criticize “white male entitlement”, but what is a more “entitled” attitude than expecting to stay on the gravy train after decades of underdelivering?

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Suspend the exit tax to get rid of Elon Musk and other toxic billionaires?

by philg

From the Harvard Book Store, a window into the thinking of our nation’s cognitive elite:

The #2 hardcover bestseller during my April 2025 visit was Muskism:

Elon Musk isn’t a glitch in the system—he is the system. His worldview promises sovereignty through technology: plug in, power up, and become self-reliant. But the more you connect, the more he owns you.

If Fordism defined the capitalism of the twentieth century, Muskism may define the twenty-first. Fordism helped build the welfare state. Musk undoes it. He thrives on dependence while preaching freedom. His cars run on subsidies; his satellites run the battlefield; his social networks train the AI that trains us.

Muskism sells itself as the future but entrenches age-old hierarchies. It offers autonomy for some and exclusion for others. It’s pro-natalist but anti-immigrant, futurist but reactionary. It speaks of humanity but warns against empathy.

The authors:

Quinn Slobodian is professor of international history at Boston University

Ben Tarnoff is a writer and technologist based in Massachusetts … He is a frequent contributor to the New York Review of Books, and has also written for the New York Times, The New Yorker, and the New Republic,

These giant credentialed academically-inclined brains say that Elon is pernicious. He’s our “dependent”, which means he is costing us money. What’s worse, this spending has resulted in Musk “owning us” rather than vice versa.

Elon Musk is pernicious and we’d certainly be better off without him. But it is also bad to be “anti-immigrant”, according to the authors, and we thus can’t use our ICE thugs to denaturalize Musk and deport him. Maybe we could persuade him to leave voluntarily? Hardly likely, given the U.S.’s massive exit tax on those who renounce U.S. citizenship. Elon would have to pay 20% capital gains tax plus 3.8% Obamacare tax (NIIT), albeit not the 13.3% California state income tax since he moved to Texas rather than pay his fair share to Gavin Newsom. This tax rate would be assessed against substantially all of Musk’s assets since nearly all of his wealth is unrealized capital gains.

What if we offered our most toxic citizens, the ones who contribute the least to our prosperity (since they don’t pay their fair share of taxes) and contribute the most to our problems (all of the above-cited, plus their presence in our society exacerbates inequality), a reasonable cost way out? If they leave in 2026, for example, they wouldn’t have to pay the exit tax.

Let’s say that someone needs a minimum net worth of $200 million to make the rest of us truly sick with envy. Anyone under $200 million, therefore, would still have to pay for expatriation.

(Separately, one of our neighbors has taken to parking his or her fairly new Rolls-Royce on the street (to make room for a truly valuable car in the garage?). I often walk Mindy the Crippler (our golden retriever) with a physician across the street and his dogs. In response to the Rolls-Royce sighting, the doctor and I have agreed that anyone richer than us should have to pay a 100% wealth tax.)

(Department of Trust Official Sources: SpaceX has a 98% launch success rate over its corporate life. The authors and HarperCollins (publisher) have chosen to feature on the cover a photo of one of the 2% unsuccessful launches.)

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How to write a thank-you note to a teacher

by philg

Young readers: it’s almost the end of your semester. Here are some of the messages from students in our FAA Ground School class at MIT (back in January) that would have warmed my heart if engineers had hearts…

[ Sloan executive MBA track; Chinese] It was wonderful to be your student. Thank you for teaching us.

[Chinese] Thank you to you and Tina again for the wonderful ground school over the past three days! I really enjoyed it and learned a lot. … Safe travels back to Florida, and thanks again!

I really enjoyed the ground school this past week.

[European] I would like to express my sincere appreciation for your guidance during the Private Pilot Ground School. The course was fun, insightful and has left me well-prepared for the upcoming FAA knowledge test.

Thank you for this class. Genuinely, I enjoyed everything that I learned.

Thank you all for this class. Really appreciated it.

Now that we live in the email age, don’t forget that it is easy to thank a teacher! I recommend copying the first example! It’s Mother’s Day and this is definitely the kind of thing that most moms would like to see a child do!

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Fiber-to-the-home arrives in Cambridge, Massachusetts

by philg

Cambridge, Maskachusetts turned down a fiber-to-the-home deal with Verizon FiOS roughly twenty years ago. Rumor had it that Comcast was funding some pet projects for politicians and, therefore, Verizon couldn’t get authorized to compete with Comcast (not yet “Xfinity”).

As part of the process of unloading my old condo in Harvard Square, I tried to figure out if fiber-to-the-home had become available without me noticing. The answer is “sort of”. More than 90 percent of the city is remains a Comcast-only (Xfinity) territory. But the city has provisioned symmetric gigabit fiber to city-owned public housing apartments. Those entitled to public housing pay $35/month for Internet that those who pay property tax could only dream of having. (It might actually be free for those who refrain from working; there is a Digital Equity Plan to relieve people of this $35/month and multiple full-time “digital navigators” get paid to help those who don’t work maximize their enjoyment of free or near-free Internet.) Jesus pointed out, “The last will be first, and the first last” (Matthew 20:16). This translates to “gives [public housing] residents access to the highest internet speeds available in Cambridge at the lowest cost.”

The person who pays $100/month in rent (including utilities) gets faster and more reliable Internet than the person who lives in a $10 million house on Brattle Street and pays property tax. The taxpaying chumps will get hit for $100/month by Comcast for comparatively terrible service.

What does a person who hasn’t worked for four generations do with Gigabit fiber? Streams multiple movies and sports games in 4K:

What do Cambridge officials work on besides keeping their tax cattle in an Xfnity ghetto? Mayor Sumbul Siddiqui was born in Pakistan and might have enjoyed fiber-based Internet there if her family hadn’t chosen to enrich us here: “Fiber-to-the-home (FTTH) internet is growing rapidly in Pakistan, with over 2.6 million subscribers as of February 2026.” (Google AI). City Hall was hosting a “Sexual Assault Awareness Month” event instead of a “Escape the coax ghetto” event:

Here are some of the shirt-based messages:

The one with the Star of David was almost next to a sign showing that future Cambridge residents will be, like the current mayor, primarily Islamic:

(Note the nod to the native-born Blacks in the background. Their lives matter and also they have already been replaced by migrants (see Replacement of Black workers by migrants in Cambridge, Massachusetts from MLK, Jr. Day 2026).)

Why would the mayor highlight sexual assault instead of the monthly assault of residents paying high prices for inferior Internet? Wikipedia says that her family never got out of taxpayer-funded housing (Rindge Towers and Roosevelt Towers; sometimes enrichment by migrants means native-born taxpayers have to pay for the migrants’ apartments for 20, 40, 60, or a few hundred years (multi-generational)). So, from her family’s perspective, Xfinity’s monopoly and decades-old infrastructure is irrelevant.

(Note that folks in Maskachusetts don’t seem to be serious about discouraging what we now regard as sexual misconduct. Age of consent is 16, which means that everything Jeffrey Epstein is established to have done would have been legal in Boston. (He admitted to some sort of sex act with a 16-year-old.) It would be almost impossible to prosecute an Epstein imitator in MA because he could raise the “she consented” defense.)

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The incompetence of HVAC installation and maintenance in Massachusetts

by philg

The 11-year-old high-end Carrier system at our old Harvard Square place failed in the hot summer of 2024. It was probably some sort of leak in the outdoor unit, but it was tough to say for sure. In Florida, this would have been repaired for about $6,000 via installation of a new outdoor unit and recharge. In Maskachusetts I got estimates from $24,000 to around $40,000 to replace both air handler and the outdoor unit. (This might have been a $12,000 project in Florida for top-of-the-line variable-speed gear.)

The company that quoted $24,000 was rated 4.9 stars in Google Maps. They’re an authorized Carrier dealer. They said that they needed to do $thousands in additional items in order to satisfy the building inspector. My suggestion that a building permit wasn’t needed because they were just replacing existing equipment was laughed off. They ran new coolant lines and, despite me begging them not to, decided to monkey with the hydroair system that sends hot water up from a basement gas-fired boiler into the attic where the air handler lives. Because the attic is technically unconditioned space, even though it never gets very cold (poor insulation in the old wooden house underneath allows heat to rise), the circulating water must have some antifreeze in it.

When the winter arrived, the hydroair system didn’t work. The only heating was from the heat pump, ruinously expensive at some of the nation’s highest electric rates. The company came back and said that we needed about $10,000 of work. The circulation pump was failed, which is why fluid wasn’t circulating. The boiler was from 2003 and should be trashed. At a minimum, everything attached to the boiler needed to be replaced. I called the plumber who’d installed the boiler. He came by and said “Your HVAC people are idiots. They filled the pipes with 100% glycol, which is too viscous for the pump to move. I drained it and refilled it with 50% glycol like it is supposed to be and everything works fine now. Your boiler doesn’t need any service and is working perfectly.” He sent me a $1300 bill (would have been $500 in Florida, but this guy is kind of a genius and Massachusetts is truly a paradise for anyone competent in the trades).

It’s finally time to sell the old unit. The market for short-term rentals in Cambridge never recovered to its 2019 level. I was never going there except to fix stuff. The family wasn’t interested in spending time in Maskachusetts. What did the lawyers working on the closing find? The HVAC company never closed the building permit that they pulled in 2024 and for which they said that thousands of dollars of extra work were required. (Ultimately, it did get closed, but not without multiple follow-up emails and calls from me. The HVAC company called the inspector and he actually did come by within a week, but he marked it as a “rough inspection”. The permit wasn’t closed and the HVAC company never checked to see if it was closed.)

(Note that the cost to heat and cool this 1400 sqft. condo, thanks to high utility rates in Massachusetts and low quality construction, is actually higher than the cost to heat (one week per year!) and cool (to 72 degrees; no Jimmy Carter austerity here) our 5400 sqft. house in Palm Beach County.)

Loosely related… this lamppost sticker from Harvard Square would make a good tagline for an HVAC business:

Also, a friend’s daughter got into a summer math program at Boston University. She is required to live in a BU dorm as part of this program. Faculty, staff, and students at BU are such experts on Climate Change that there are 31 pages of results from Google when searching for this string on the BU site:

How did the climate change experts prepare their own campus for the brutal heatwaves that are now hitting Boston regularly? (example) They failed to install air conditioning in their dorms.

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Ozempic/GLP-1 drugs are yet another way for Boomers to steal from those of working age

by philg

Just as GLP-1 drugs hit the mainstream, the last of us Baby Boomers hits the minimum Social Security retirement age (1964+62=2026).

Working-age slaves pay taxes to fund Boomers’ Medicare. These costs will increase because GLP-1 drugs are expensive. Working-age slaves pay taxes to fund Boomers’ Social Security (our beloved Ponzi scheme). Boomers will now live 10 years longer because they’ll all be back to their design weight via GLP-1. A Boomer who lives longer will drain Social Security, thus forcing those of working age to pay higher tax rates and/or receive lower benefits themselves (maybe those of current working age will become eligible for Social Security at age 85?). A Boomer who lives longer in a state such as California will hog prime real estate due to Proposition 13 that caps property tax increases on long-held real estate (we have the same thing in Florida, but it is limited to a primary residence). Boomers who are mostly blind will inflict massive traffic jams on those of working age by going for jaunts in their self-driving cars, thus stealing time from the working age Americans who support the comfortably retired.

Here’s the latest expensive drug (Retatrutide) that the working age slaves will have to buy for us Boomers:

Google AI: “Experts estimate the monthly cost could range between $1,000 and $1,500+ once available. … Phase 3 trials are expected to conclude in Q3 2026, with potential commercial release following afterward.”

Novo Nordisk apparently learned from history:

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Does it make sense to pay for high-net-worth insurance in coastal South Florida?

by philg

Happy Middle of Hurricane Preparedness Week for those who celebrate…

Conventional insurance companies such as State Farm have mostly walked away from insuring coastal South Florida due to a combination of litigation risk (“Prior to the reforms, Florida accounted for more than 72% of the nation’s homeowners claim-related litigation in 2023, despite representing only 10% of US homeowners claims.”) and hurricane risk. Our house is about 2.5 miles from the ocean, but it is still redlined by the insurance companies most people have heard of. Here are the options for insurance:

  • a Florida-only carrier that turns most of its premium over to reinsurance
  • a “non-admitted” specialty company that isn’t regulated by the state and that may have unfavorable terms, including penalties for early cancellation and even a “wind exclusion” (i.e., they pay nothing in the event of the most obvious risk: hurricanes). (This option is so expensive and dumb that I won’t cover it here.)
  • a “high-net-worth” (HNW) carrier such as Chubb (mostly rejects additional Florida risk; famous for a low loss ratio (payments as a percentage of premium collected)), Vault, PURE, and Berkley One (despite the name, these are available to peasants whose house is worth less than a Palm Beach starter home ($10 million))

The cost of HNW insurance is 2-4X what a Florida-only company might quote.

Nearly all Florida insurance includes at least a 2% wind exclusion. If the dwelling value is $1 million, in other words, the homeowner pays the first $20,000 of any hurricane-related loss. Thus, the vast majority of customers with hurricane damage will receive nothing from their insurer because the typical hurricane damage might involve only some blown-off roof tiles or shingles. The band of likely serious damage from a Category 4 or 5 hurricane making landfall is 20-60 miles, e.g., for Hurricane Andrew in 1992 that resulted in major changes to the Florida building code or Hurricane Michael in 2018 that damaged Tyndall Air Force Base. Note that this exclusion results in the HNW policies paying less after what would be typical hurricane damage because HNW companies write for 2X the dwelling value on the same house.

The Florida-only carriers are typically unrated by AM Best, the standard rater for insurers. It has been historically rare for an insurer rated A or better by AM Best to fail. Florida insurers get rated by Demotech. How well does it work for an insurance company to have all of its customers in Florida? According to ChatGPT, nearly all of the Florida-only companies that have gone insolvent had A ratings from Demotech (i.e., the ratings were worthless in terms of distinguishing the vulnerable carriers from the solid ones or, perhaps, the solvency of a carrier simply depended on their luck regarding how many customers were in a hurricane destruction zone).

Insolvency after a major hurricane doesn’t work the way that one would think, with the failed insurance company realizing that it is doomed to failure and going into a bankruptcy-style process where every claimant gets paid a percentage of his or her full claim amount. Instead, the insurance company, even after a major hurricane, pays claims as they’re made and adjusted at 100%. When the company runs out of money they turn out the rest of the claims to the Florida Insurance Guaranty Association (FIGA), which will pay up to $500,000 for a destroyed house. So… the customer with a major loss either gets 100% or a fixed $500,000. The more complex the claim, the less likely it is to be paid. ChatGPT says that it is reasonable to assume a 10 percent chance of insolvency for a Florida-only carrier in the event of a major hurricane. The most recent insolvency that triggered a FIGA payout was of United Property & Casualty Insurance Company in February 2023. That’s three hurricane seasons ago. Since then we’ve had some hurricanes, but none anywhere near as costly within Florida as 2022’s Hurricane Ian. Let’s use a 20 percent risk of insolvency if a house is damaged to policy limits and a 10 percent risk of insolvency if a house is damaged to half of the limits.

What is the risk of a total loss or serious damage? Gemini starts off by saying that it is pretty high, with 300,000-400,000 single-family homes in South Florida either substantially damaged or destroyed by hurricanes over the past 50 years. That’s out of about 2.7 million homes in South Florida today, but only an average of 1.7 million homes over the 50-year period. (ChatGPT estimates this number as only about half of Gemini’s figure; our future AI overlords are smarter than humans, but equally inconsistent?) So a homeowner’s insurance company has about at least a 1 in 7 chance of making a big payout? Not exactly. First, we have to separate out the houses that were damaged by flooding or storm surge, between 120,000 and 180,000. Homeowner’s doesn’t pay for flood damage. Now we’re down to a risk of about 1 in 10 over 50 years. What about the fact that Florida established a strict statewide building code in 2002, hoping to avoid a repeat of the Hurricane Andrew aftermath, roughly 25,524 homes destroyed and 101,241 damaged (Insurance Information Institute). Gemini:

In major storms like Hurricane Michael (2018) and Hurricane Ian (2022), structural engineers found that homes built to the 2002 code (or later) suffered roughly 80% to 90% less wind damage than their older neighbors.

A report from an insurance institute wasn’t quite as rosy:

IBHS evaluated 3,646 single-family homes, 327 light commercial buildings, and 230 multifamily structures [after Hurricane Ian] using aerial and street-level imagery. … Homes built before 2002 had structural damage levels nearly 2x higher, and 2.3x higher in areas with peak winds above 130 mph.

It looks as though no post-2002 house actually lost the plywood sheathing supporting the roof, but at least some had exposed sheathing and, presumably, water damage as a result. A companion report from the same organization says that asphalt shingles were the weak point, metal roofs were the best (12% damaged), and tile roofs weren’t significantly damaged except those more than 20 years old (“no tile roofs assessed that had greater than 50% roof cover damage” and, confusingly, “the small number of roofs with greater than 25% cover damage … These roofs were all 20 years or older”). Our 2003 house has a one-year-old tile roof with two layers of “peel and stick” underneath. If the tiles are blown off, but the peel-and-stick underlayment survives then we’re looking at a $120,000 insurance claim to put a new tile roof on the house (maybe less if the underlayment isn’t too old and can be retained).

ChatGPT says that 4-6 Cat 4/5 hurricanes hit the Miami-to-Stuart coastline every 100 years. Let’s take this distance as 108 miles. If you assume that the zone of total destruction is 20 miles wide then a typical house gets destroyed roughly every 110 years. If the destruction zone widens to 40 miles, the interval between destruction is 55 years. The most recent major hurricane to hit Palm Beach County was in 1949, 77 years ago, but we could use the 55-year estimate to make the high-net-worth companies look more attractive.

[We’ll ignore tornado risk. A tornado could destroy or seriously damage a house, of course, but it wouldn’t affect an insurer’s solvency because a tornado is local. This is a 1 in 100,000-year event for a typical South Florida house, according to AI.]

As noted above, one quirk of the HNW policies is that they force buyers to pay to insure the full rebuild cost of a house, which for a 2003 house like ours is much more than the house is worth. Imagine if we insured our five-year-old Honda Odyssey for the cost of a brand new Honda Odyssey. Why would we want to do that when what is actually at risk is only about half that number? A neighbor has Chubb and they would pay him over $4 million for the house and contents in the event of a total loss (maybe $5 million if we add “loss of use”). His house has a Zestimate of $1.8 million, has its original roof and non-impact windows, and sits on a lot that should be worth at least $500,000 if the house were razed. The contents of the house aren’t valuable. So he has perhaps $1.5 million that could conceivably be lost under his $4+ million policy. (Note that the neighbor won’t get the high dwelling value unless he actually does rebuild, an irrational choice to make compared to simply moving to a similar house and letting a professional real estate developer deal with the wreck. If the family moves to a $1.8 million house a few blocks away, he gets paid only about $1.3 million (the depreciated value of the structure).

Let’s have a look at a couple of quotes. Below is one from Olympus, a Florida-based company that was founded in 2007, i.e., 19 years ago. Whoever started the company should buy lottery tickets because it was founded right at the beginning the 2006-2015 “no hurricanes making landfall” period. That said, the company has survived the following hurricanes that did make landfall in Florida:

  • Hermine (2016)
  • Irma (2017)
  • Michael (2018)
  • Ian (2022)
  • Idalia (2023)
  • Helene (2024)
  • Milton (2024)

Furthermore, Olympus is unusual in being rated by KBRA, which is significantly more stringent than Demotech. Olympus is rated BBB+ by KBRA (over the minimum BBB accepted by Fannie Mae; it’s ironic that the enterprise that generated the largest insolvency in U.S. history, requiring $150+ billion in tax dollars as a bailout, closely scrutinizes insurance companies). For the handful of companies that are rated by both KBRA and AM Best, the ratings seem to be similar.

Could they survive a repeat of the 1949 hurricane that came right into Jupiter? (the most recent major hurricane to make landfall in Palm Beach County) There doesn’t seem to be any way to find out. An insurance company with 50,000 customers, each of which is on its own square mile within the 53,625-square-mile state of Florida is going to be much less stressed by a hurricane that hits Fort Lauderdale than one whose 50,000 customers are all in Broward County, for example. (Broward County was last hit by a major hurricane in 1947, though Hurricane Wilma, Category 2, did about $4 billion in insured damage in 2005.) The information on risk concentration by company is nowhere to be found. In theory, the reinsurers who agree to do business with the companies are looking at this and maybe the regulators.

It is difficult to have faith in regulation when one hears about Florida-based Slide Insurance. The founder and his wife siphoned off $50 million in compensation out of a total profit of $288 million in 2023-4 (source). Based on this, it seems that an insurance company could pay out all of its profits to employees and shareholders during 15 lucky years without major hurricanes affecting its territory and then fold up its tent after a Hurricane Andrew-type event occurs. ChatGPT: “There’s no strict statutory cap tying executive pay to solvency. … As long as they stay above minimum surplus requirements, they’re compliant. But those minimums may not cover a true tail event (e.g., Andrew-scale).” People with inexpensive-by-Florida-standards houses will still do okay with $500,000 from FIGA, of course, so this is a great example of privatized profits and socialized losses.

What did the high-net-worth companies have to offer?

Notice the PURE quote with a 5% wind exclusion. If our roof were destroyed, but didn’t leak, and we lost 7 or 8 of our impact glass windows they would still pay nothing because the wind deductible would be $195,000. In a “medium bad” event, the Olympus policy at less than one third the cost could easily pay 2X because of the deductible being only 2% of a much lower dwelling value.

Let’s do a spreadsheet model

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