Saturday, October 31, 2020

People Believe What They Want to Believe

Raging true-believer-ism is never good for you, personally.

I noted before that I have no truck against those who believe in different things than I do.  On the other hand, I have little respect for people who believe in nonsense.   If you are a developer, for example, and want your taxes lowered, regulations reduced, and those pesky inspectors from the County to leave you alone, I can understand why you might vote Republican.

Or, if you are of a religious bent and think abortion is unholy, I get it that you vote Republican, even if the candidate in question seems more like the anti-Christ than an angel.

Similarly, if you are young, burdened by student loans and without a good-paying job or a decent place to live, I can understand why the snake-oil of Socialism sounds appealing.  Or maybe, you want to have health care but can't afford health insurance - and want to see Obamacare preserved.  Voting in your own self-interest isn't hard to understand - everyone does it, to some extent.

But believing in utter bullshit - crazy conspiracy theories that really don't intersect your life - well, that's just craziness.  Saying you support Trump because he is going to dismantle Hillary's Pizza-Kitchen pedophile ring is just insane talk - yet so many do this sort of thing, on both sides of the political spectrum.

Sadly, both sides of the spectrum are pushing these "stories" which are pretty much bullshit.   A friend of mine breathlessly reported that Joe Biden confused Donald Trump with George Bush - by calling him out as "George".   A sure sign of dementia!  And as we all know, since Biden is three years older than Trump, he must be too old to be President.   As others have noted, both candidates are older than the last three living former Presidents - Bush, Obama, and Clinton.  Only Jimmy Carter is older.

The reality is, of course, that Biden didn't confuse Bush with Trump. He was talking with George Lopez at the time, whose name happens to be the same as GW's.   But hey, a carefully edited video makes it seem otherwise - and obviously, that's a good reason to vote for Trump!  The weird thing is, my friend was predisposed to vote for Trump (the abortion angle) so the edited video didn't really convince them of anything. And I doubt it convinced any "undecided" voters anymore than stories about Hunter Biden's laptops - of which there are apparently four or more in repair shops in Bethesda or the Ukraine or whatever.   That guy has a lot of laptops, which like "e-mail" we know to be a dirty word.

We are so used to "October Surprises" that we discount them these days.  Sean Hannity now claims he has "secret documents" but that UPS stole them or someone broke open the package and took them.  How convenient for him - on the eve of an election.   Does anyone, other than someone already predisposed to vote for Trump, really believe the timing of this?  Of course not - you can't "October Surprise" forever, even the dullest among us catch on.

Meanwhile, on the Left, people are chuckling over Rudy Giuliani's hands-down-his-pants, which conservative pundits are falling all over themselves to explain as a mere tuck-in.  I have no doubt that Sasha Baron Cohen has heavily edited his videos to make them appear to show something that really didn't happen - that is is schtick.  He does outrageous things and then edits the videos to make it appear that people are racist or whatever. In a way, it is sort of cruel, particularly when the people he victimizes are just ordinary folks who don't deserve to be skewered on a national stage.  But Rudy Giuliani?   Skewer away!

Seriously though, I am willing to give him the benefit of the doubt regarding his "tucking in the shirt" excuse, but don't give him a pass for going into a hotel room bedroom with a young woman "for a drink" - he should have known better.  And the fact he didn't figure out something was wrong after Cohen's odd behavior as the "sound man" shows a lack of judgement.  But as Trump famously said, "Well, that's Rudy!"

On the other hand, you can see the video is carefully edited to show the same scenes from different angles, to make it appear Rudy was doing more than a tuck-in.  And maybe he was.  The point is - does this change anyone's mind about Rudy Giuliani one bit?   Probably not.  It does provide a cathartic release for some on the Left, just as the altered Biden videos do for Trump supporters - it provides a confirmation bias that their side is "right" and that the "other guy" who supports the opponent has to be insane or deranged.

And maybe that is where these Pizzagate and Qanon people come from.   Their primary motivation to support Trump isn't based on these bizarre conspiracy theories, but they are just another reason to support him - and demonize the opposition.   After all, anyone who supported Hillary (or today, Biden) must like ping-pong, pizza, and pedophilia - such folks are beyond help!  They probably like Hawaiian Pizza to boot!

Thus, the political debate is shifted from policies to nonsense.   It doesn't matter what polices Trump has enacted or what Biden is proposing, we are told that what is really important are the wild claims that Osama Bin Laden is still alive and Biden "ordered" Seal Team 6 to be liquidated (because as we all know, Vice-Presidents have so many duties and authority - beyond being a tie-breaking vote in the Senate and attending funerals of foreign dignitaries).

Political hacks call folks who fall for these gags, "Low-Information Voters" - people who follow gossip and drama, but have little grasp on the real issues of the day.  My friend who barfs up anti-Biden attack videos also watches "Dancing with the Celebrity Chef Bake-Off Home Flipping Voice Stars!" or some such dreck and can't understand why I don't follow that sort of nonsense with breathless enthusiasm.   Television, alas, creates low-information voters - people who think "Reality Television" is real, and vote for a Reality Television star for President.

The issues are what is important this time around.  And I can't say I 100% agree or disagree with each candidate on the important issues of the day.   But on the whole, I have to say that four years of Trump hasn't been a good thing.  Yes, the stock market has gone up (not as dramatically as during either four-year term of Obama) but at a price that we will have to pay down the road - in terms of deficit spending and increasing national debt.

During a recession - the greatest seen since the depression, as was inherited by Obama, or during a national crises, such as this pandemic, one can understand why "priming the pump" through government spending might be a good idea.   But what about the first three years of the Trump administration?  What was the point of the tax cuts and profligate spending then?  Shouldn't we have been paying down our debts rather than increasing them?

It is a trend on Wall Street to jack a company for quick profits, ramp up the stock price, and them dump it all before it goes horribly wrong.  Sadly, it seems the current administration is doing just that to the economy, and it appears that once again, a Democrat will have to pick up the pieces, re-institute the regulations that were designed to prevent such shenanigans, and try to slowly claw our way back to prosperity.

Four more years of Trump, I'm afraid, will only dig ourselves in deeper.

Postscript: My friend who thinks Biden is demented, promised me that Trump has a "beautiful plan" to replaced Obamacare and that "Trump will take care of you!"   I am curious as to why Trump won't show us this plan, however (perhaps because, like his taxes, it is being audited?).    We are being asked to buy a pig-in-a-poke, to "trust" Trump to do the right thing, when he could just as easily show us what his plan is.   I suspect this is because either (a) he has no plan, or (b) the "plan" is no plan at all, but to just abolish Obamacare and revert back to the system we had before, where health insurance is expensive and covers little or is utterly unaffordable for most Americans.

When choosing between a known (Obamacare) and an unknown (Vague Promises by Trump) it isn't hard to make a decision.  And again, you have to expect people to vote in their own self-interest.

Wednesday, October 28, 2020

The Economy is Great! The Economy Sucks! Which is it? Both?

The overall strength of the economy isn't measured by one quarter's growth.

In 2019, there were ominous signs that the bull market and expanding economy of the Obama era was drawing to a close.  Car sales were starting to slacken off, and sales of RVs - often a bellweather of the economy - were dropping by double-digits.  Consumer debt was at an all-time high, as was corporate debt.  Many companies, particularly in retail, were going belly-up, not killed off by Amazon or even Wal-Mart, but by the crippling debts they took on as they went "private" and were taken over by "venture capitalists".

Then 2020 happened.  The pandemic closed many businesses for weeks at a time, and many, even when now open, are running only at partial capacity.   But a funny thing, car and RV sales are through the roof.  Interest rates were slashed to zero percent, and people with nothing else to do, went on a buying binge.   Since no one could vacation on a cruise ship, or at Disney World, and flying in an airplane seemed like a bad idea, America went camping this summer.

All summer long we saw them - "CoVid Campers" with temp tags on their trailers or brand-new tents still in the box, struggling to figure out how to back up a trailer or insert tab A into slot B on their tent.  Perhaps many will be converts to the camping lifestyle.  Perhaps many more will be selling trailers and camping gear at a loss next Spring.   At one campground within two hours' drive of New York City, we saw a sign on the dumpster, "Don't dump your camping gear in here!"   When we asked the ranger, she told us that many of these weekend warriors get discouraged after a rainy Saturday night and toss away hundreds, if not thousands of dollars of wet camping gear and then drive back to Brooklyn.  People are crazy.

While the car business has been brisk in the last quarter, we have to remember that it basically stopped entirely in the first quarter.   Profits from one quarter are merely offsetting losses from earlier on, if that.   Yes, inventories are tight - car factories were shut down for weeks earlier in the year.  And yes, the "overflow lots" of the FCA near where we keep our camper are now empty - even the Dodge minivans are gone!  Weeds are growing through the cracks in the concrete.

So, recession over.  Trump is a genius - and economic recovery is around the bend!

Not so fast, MAGA-hat!   Tell that to Boeing and all of the airlines.  Tell that to the cruise industry which is scrapping ships at a rapid clip.   Tell that to the folks at Disney and Six Flags and any other theme park.  Tell that the Sheldon Adelson, who is trying to unload his Las Vegas properties at fire-sale prices.

And as this Forbes article notes, the "rebound" in GDP in this quarter only looks good because it is pulling out of the basement of the previous two quarters.

The Paycheck Protection Program and expanded unemployment benefits have pumped a lot of cash into the economy - the classic "stimulus" model that Republicans hate, but have learned to embrace, at least in an election year.  Problem is, stimulus expires and companies which have been paying people not to work are now having to face real layoffs.  Expanded unemployment benefits will also expire - as they always do, eventually.   In the next few weeks and months, we'll see the hurt expand across the economy as people who have been spared pain so far are forced to reckon with both the virus and the recession that was on its way before the virus hit.

But what about car sales?  They are through the roof!  Well, not exactly - when you stop sales of all cars for a month, there is bound to be pent-up demand.  People whose leases were expiring have to turn in cars, and indeed this was a problem if you lease expired in May or so, and the dealership was closed.  Folks whose cars were wrecked, stolen, or just worn out, were in the market for new cars in June, with none to be had.   So the "boom" in auto sales today is just the make-up for lost sales in the first quarter, not necessarily some sustainable growth for the future. Cheap gas and low interest rates are encouraging many folks to buy a new SUV or truck.  Is this a sustainable trend, or a one-time blip?

Yes, GE made an unexpected profit this quarter - by slashing costs dramatically.  Cutting costs is good, but you can't make a profit by cost-cutting, in the long-term.  You have to sell products, and GE's most profitable product - aircraft engines - is basically on hold, as the airline industry cancels order after order.  Boeing basically has shut down the 737 MAX line, and all the unsold airplanes may take years to unload.  Whether they actually start up production again remains to be seen.  The only good news for GE is that its staggering liability for its ill-advised "long-term care" insurance polices may be slashed as the elderly die off in droves in nursing homes.   Hey, there's a silver lining in everything, right?

The problem for the real economy (and not just the DJIA) is that a plethora of people will be losing their jobs - permanently - in the coming months.  Smaller airlines are already feeling the pinch, and if 9/11 is any guide, it may be years before we see passenger traffic rebound to pre-pandemic levels.  If people become more and more comfortable staying at home and working online, it may permanently alter our economy in ways we cannot perceive just yet.

Welcome to the Biden recession.   Yes, that is what the Republicans will call it, if Biden wins.  Just as they re-characterized the crash in 2008 as the fault of Obama (when it occurred during Bush's tenure, and it was he, not Obama, who signed the bailout!) the GOP will conveniently argue that all the bad shit going down is the result of Democratic policy.   If Trump is re-elected?  They will still blame the Democrats and use the recession or depression as an excuse for "emergency measures".

The way we have been goosing the economy over the last three years - and last three quarters - is not sustainable.   During the last three years of the Trump administration, we have slashed taxes on the rich and printed money to beat the band, increasing deficit spending and the national debt - the latter being something Republicans used to be against.   That kept the Obama recovery and bull market going for three years.  Then the slowdown in 2019 and the virus in 2020.   We've now gone from the crack pipe to the meth pipe - paying people not to work and just handing out money to American companies willy-nilly.  Interest rates went from ridiculously low 1.5% to zero percent - not negative just yet.  And now Trump proposes a payroll tax holiday, which would put more money into people's pockets and fulfill the GOP prophesy that Social Security is going bankrupt - years earlier that previously predicted!

The crack pipe/meth pipe analogy is apt, I think.   You can smoke crack and feel fine, for a while at least.  And doing meth?  You feel like a super-man!  But these are short-term effect, and unless you keep going back to the pipe, again and again, the feeling goes away in short order.  Pretty soon you are stealing and doing odious things, just to get another hit.  And in the long term (which becomes the short-term, very quickly) your physical and mental health takes a toll.  Eventually, you crash and burn.  There are no elderly long-term meth users in the retirement home.

Trump and Mnuchin have kept the party going long after closing time.   As a result, I think we may see double the hangover, come the new year.

Somebody, some day, has to pay back all this money the government has been borrowing.  Odds are, it will be you and me.

Tuesday, October 27, 2020

Pride of Ownership? No.

 

To some folks, possessions are a means to an end.  For others, they are an end in and of themselves.   Use objects, don't let them use you!

I mentioned in a recent posting about the car in a bubble how some folks acquire expensive things like cars, boats, and even houses, and keep them as talismans of ownership - where the mere possession of the thing becomes more important than the use of it.  House polishing I mentioned before - people who want to make their house into a perfect possession (thank you very much, This Old House!) rather than cherish the memories of family and loved ones who lived inside.

I ran into this effect recently when I met a couple who had an Escape travel trailer like ours.  We asked them about where they had been with it - and regaled them with tales of our trips to all 49 US States (except Hawaii, of course) and all the Canadian provinces (other than The Disputed Lands and The Unexplored Territories).  They kind of gave us a blank look.

The only place they had been with their trailer - for several years now - was to drive back to the factory every year to meet other people who had bought the same brand of trailer at an annual trailer-fest.  What?   Even the drive across America and Canada to Vancouver, BC, held no interest for them - they covered it in a matter of days.  And exploring Vancouver - particularly Vancouver Island - held little interest for them, other than to take the ferry to Victoria and spend a few hours wandering around downtown.

We've been - twice - the first time in our Casita, where we spent a month or so, and a second time in the new trailer where we spent two months.  And that is hardly enough to even begin to explore that beautiful island. But to them, British Columbia was all about going back to the factory, attending potluck suppers, and talking with fellow trailer owners about their trailers.  I just didn't get it.

I am not criticizing this - to each their own.   If they found satisfaction in such things, good for them. But for us, the trailer was a means to an end - it allows us to explore places and stay for days and weeks, without spending hundreds of dollars a day on hotel rooms and restaurant meals. The ownership, in and of itself, provides less satisfaction.  And I've learned the hard way, over the years, that I have little in common with other people who own the same brands of products as I do.

And sadly, in each of such groups, there is always some old cantankerous guy (usually a guy, usually more cantankerous than even I) who will shout down any "newbie" who has any ideas that are out of the norm.  You know, the penlight battery guy.   That is why I stopped visiting car and boat and RV forums for the most part.  It is like going on a Qanon site - they aren't interested in discussing ideas, only validating pre-existing notions.  Forums can be useful in obtaining some data, but a lot of the postings are shills for products, and a lot more are just bad data, bad ideas, or just trolls and flames.

Oddly enough - or maybe not so oddly enough - the folks who keep cars, boats, RVs and such as talismans, tend to spend a lot of time on these forums.  I guess for them, it is the social interaction with fellow owners they like, not necessarily the product itself.   Go on the Airstream forum sometime, and see what I mean (and learn what "buyer's remorse" is all about!).

It seems to be a pattern, however, particularly in America.  I know a host of people who own "collector" cars that never see the light of day, other than to be trailered to a car show, rolled out, admired for a few hours and then put back in the trailer and hidden away in a garage. Might as well get a cardboard cutout of the car and display that.  Going to such shows is, to me, somewhat boring. The meticulously restored cars that are merely displayed, I just walk by.  The guy who drove his car there and clearly works on it himself, and takes it on trips, is far more interesting, in my book.  He's using the car for its intended purpose, not just creating a car-in-bubble to be admired.  You can look at bubble-cars all day long on YouTube, if that's your thing.

I mentioned before how I met an older gentleman at the marina who was supervising a mechanic as he rebuilt the outdrives on his power boat.  I kept our boat there and knew his had not left dry rack storage in years.  He admitted as much, and I asked him why he kept the boat (which cost $3000 a year just for storage) and he replied, "Pride of ownership!"   But if something is kept on a rack in a barn, what pride is there in it?  Do you show people the cancelled checks for the storage fees or what?

A better approach, I think, is to buy a boat and use it, and when you get done using it, either because you are bored, or your "trip of a lifetime" is over, then you sell it.   There are storage lots, marinas, RV parks, RV storage lots, storage locker places, and backyards all over America, filled with "pride of ownership" decaying cars, trucks, motorcycles, jet skis, snowmobiles, RVs, and boats - most not running anymore, most worth something at one time or another before they were put in storage, most not worth anything to anyone, most an eyesore.

We were talking with the owner of our storage locker place where we keep the trailer (for now) when it is not in use.  His Dad was saying they should sponsor a garage sale once a year to help people clean out their storage lockers.  The son wisely said, "Dad!  That's our bread-and-butter!  If people actually got rid of this junk, where would that leave us?"  His Dad quickly saw the logic of this, and dropped the idea.  They make money from people paying more to store things than they are worth.  As I related before, when I closed my office, I put all the office furniture in storage and sold it off, piecemeal, over time.  By the time I was done, it was all gone - and what I realized in sales prices was equal to what I paid in storage fees.  It would have been less effort and cost the same to just throw it all out.

The material is mortal error.  Possessions are slavery.   We come into this world with nothing and leave the same way.  "Stuff" that you accumulate and discard along the way are a means to an end, not an end in and of themselves.  "He who dies with the most toys" doesn't win anything, but rather leaves a pile of depreciating junk for his heirs to dispose of - often with a dumpster.

I started this blog at a time in my life when I thought I "had it all" and realized that "things" were slowly drowning me.  We had fun with the cars, the boats, and the RVs and the vacation home and whatnot.   But when the fun was over, we did a smart thing and unloaded them all - often at a loss. With motorized anything, always at a loss.  And that is one reason so many people are reluctant to part with "things" - I paid good money for that! - they say, and don't want to bite the bullet and walk away.

But hanging on does "cost you something" as a car, boat, or RV, depreciates in value for every day it sits in your yard, and costs money for every day it is in storage.   Eventually, these things have little more than scrap value.  In the case of boats and RVs, often you have to pay someone to take them away.  Why do you think so many charities want you to "donate your used car, boat or RV?" - because they know these things are worth little or nothing, and you want them out of your life at that point.

And owning a car, motorcycle, boat, or RV and doing little more with it than taking it to conventions and shows and talking with people who own the same brand of vehicle, well, that strikes me as somewhat shallow.   But to each their own.

The Silliness of Credit Scores - And Chex Mix!

 

Bank of America claims my Transunion credit score is 845.  So why does Credit Karma say it is only 812?  Why should I care?

I noted before that the once top secret credit scores - which you had to pay a fee to see - are now offered by everyone from banks, to credit card companies, to credit reporting agencies, to credit karma and others.  This does not mean the information you receive is accurate or an accurate representation of your crediworthiness.

I noted that recently, Experion said my credit score jumped to 845 only because some "dormant" credit cards were now being used, which is to say, I was in the Adirondacks for a month and had no access to the internet, so I let a balance accumulate - instead of paying off my accounts daily.  Credit Karma, on the other hand, said my Transunion and Equifax scores were 812 and 824, respectively.

Well, OK, the different companies use different algorithms, I guess.

But today, Bank of America sends me a report that my Transunion score has jumped to 845.  What gives?  I log onto Credit Karma and they say my scores are still 812 and 824 - as of the same date.

Someone has some wrong data here - or are there more than one Transunion scores out there?  Or does Credit Karma update only every so many weeks or months?   I suspect the latter - Credit Karma can only afford to update every so often, so even though their site says "Updated October 21" I doubt it was.

On the other hand, Bank of America claims their score was updated October 19th, and what's more was previously 839, not 812.  What the heck is going on here?  Maybe there are different scores for different applications.  I have no idea.  But it illustrates how chasing the almighty credit score is a waste of time.

In a way, it is like our tax laws - they are not a guide to investment!  People chase tax deductions and credits, thinking this is how you get ahead in life.  But I think a better approach is to live your life and take the deductions and credits you are entitled to.   Sure, the depreciation deduction is a nice icing on the cake, if you own a rental property.  But you are better off owning a positive cash-flow rental property than relying on tax deductions to make it all work.  Because eventually, those deductions peter out anyway, once the properly is fully depreciated.   Tax deductions for a 401(k) and home mortgage interest are fine and all, but when the economy hits the skids (as it did in 2008) you'll find your 401(k) decimated and your house plummeting in value - but that nasty mortgage payment still due.  Maybe being massively in debt while at the same time, investing, isn't such a swell idea.  Maybe.  Leverage is fine and all, when it is someone else's money, I guess.  But I digress.

Credit scores, I think, work the same way.  Pay your bills on time and keep your financial house in order and your scores will be sufficient.  Play games and try to "game" your score, and odds are, you will end up in a world of woe.   Just a thought - my philosophy, anyway.

On another note, I finally received my CHEX report by mail.  This is another scoring system used by banks to determine whether you are checking-account worthy.  It was a much shorter report with NO DATA on it, in terms of history or reporting.  I suspect that the only time data is reported to CHEX is if a bank has a bad experience with you.  So no data means good data - or it means the banks I do business with don't deal with CHEX.  It was an interesting experiment, even if it was a bust.

Again, pay your bills on time and stop bouncing checks, and banks suddenly want your business. Funny how that works.  Took me a long time to figure it out, too!   Not sure there is a way to "game" the CHEX report anyway, as they appear to report only raw data and not some silly-ass "score" whose algorithm can be spoofed.

Maybe the credit reporting agencies should just abolish the "score" as well - it doesn't seem to be worth much to anyone anymore anyway!

Sunday, October 25, 2020

Beads and Trinkets



We laugh at the Indians for selling Manhattan for $24 worth of beads and trinkets.  But are we doing the same thing today?   Who's laughing now?

I harp a lot on how we are a wealthier nation than in the past, and one reason we are effectively wealthier than in the past, is that we have access to such inexpensive goods in our lives.

A 25 inch diagonal television in 1975 cost $500. For that same sum today, you can buy a huge wall screen television with far more features than the simple tube job my parents had back then.

And these things are cheaper because they're made overseas, particularly in China. American labor costs, in contrast have escalated dramatically.  Today, a $500 television is not worth repairing, as the labor cost just for two hours of inspection and repair would exceed the value of the TV set.

These sort of electronic trinkets are so cheap, and it is tempting to buy them, and bankrupt oneself, one credit card charge at a time.

For example, I recently bought a tire pressure monitor for our trailer. This was an inexpensive solar-powered system which cost $22 on eBay.  It worked fine until one of the sensors started leaking, and which point I tried to find replacement sensors online, only to realize I would have to buy an entirely new system, but the price was only, of course $22.

The irony of it all was that the system worked, setting off an alarm to tell me the right front tire was down to 22 psi - but the leak turned out to be in the sensor.  The device designed to prevent a blowout was going to cause one, if I was not careful!   Maybe I would have been better off just kicking the tires when I stopped for gas - like the old days.

They make the sensors in two forms. One is a cap that screws onto the end of the existing valve stem. Another is a replacement valve stem that you insert into the tire rim. The latter is a better choice, as it is less prone to leakage and damage. However it does require that you take the tire off the rim and then insert the new valve stem, and then remount and rebalance the tire.

And there is the catch. It costs $15 or more per tire to have it unmounted, the new valve stem installed, and then remounted and balanced. Thus, the cost of installing one of these valve stems on just one wheel would almost be equivalent to the overall cost of the entire tire pressure monitoring system. American labor costs, particularly for service labor, far exceed the cost of materials from overseas.

Maybe I will buy another one of these systems, this time with the valve stem sensors instead of the cap sensors, and install it when I go to replace the tires on the trailer. The tires have over 11,000 miles on them so far, but are more than halfway worn out. Trailer tires don't last very long to begin with, and as you guessed it, these tires were made in... China.

It got me to thinking, though, that the Chinese are pretty clever. Just as the American colonists snookered the Indians with beads and trinkets, the Chinese are slowly bankrupting our country by selling us inexpensive junk which we buy by the bucket-load. The prices are so scandalously low that it's hard to resist temptation to click on "Buy It Now" on eBay when you see something for sale for only $5 or $10, maybe $25 at the most.

But even though these are small individual purchases, over time they add up to a lot of money. In the end, we will end up giving away the entire country in exchange for shiny trinkets and electronic gadgets.

Maybe I'll just throw away the existing sensor and be done with it.  After all, the one sensor lasted only a year or so.  I am guessing it was hit by a rock or something, who knows?  Do I go back to the well for more abuse because it was "only $22"?  Or am I being a chump for buying a trinket that only works "kinda sorta" and even then, not for very long.

Damn these Chinese!  Tempting us with these neat electronic gizmos, knowing full well that we Americas are addicted to them like crack!   I guess this is cold, cold revenge for the opium wars, more than a hundred years later...

Halloween Overload

 

When did Halloween become a major holiday?

When I was a kid, we all kind of looked forward to Halloween. Sure, we wanted the candy, but the stress of "what are you going as?" was way too much.  Back then, you either had to make your own Halloween costume, - which was kind of tough when you were six years old and your motor skills still developing - or you bought a "store bought" costume from the five and dime.

This was what Halloween costumes were like when I was a kid.

The store-bought costumes were very lame by today's standards.  They came in a box, and you could buy Superman, Batman, Witch, Vampire, Frankenstein, or Princess.   The Superman costume (which I went as, one year) comprised little more than a flammable plastic cape and a blow-molded plastic mask with two eye-holes and a mouth hole, and a thin elastic band that held it to your head.   It bore no real resemblance to Superman, of course, unless he was a burn victim.

This is what Batman looks like today.  A lot has changed - we are a wealthier country!

That was then.  Today, kids can choose from a number of professionally-made costumes, which, thanks to cheap trade with China, are very elaborate.  Back in the day, these things simply didn't exist, unless you had a Mom who sewed and could make some amazing costume to intimidate the other kids, and more importantly, their Moms.

Not only have the costumes gone to the next level and beyond, Halloween decorations have gone ballistic.  Back in the day, you had maybe a carved pumpkin - or two.  Today, that is just a starting point for lighting effects, a yard full of inflatables, expensive animatronics, and whatnot.   People turn their homes into graveyards and haunted houses.

And like with Christmas decorations, the best and most elaborate displays are often in poorer neighborhoods - the lower-middle-class type.  These are people who have a lot of money pass through their hands but manage to hang on to little of it.

I have always found it fascinating that people who complain about money woes are often the first in line at the Hallmark store or the big-box store, come holiday time, to buy a new inflatable, string of lights, or other holiday paraphernalia.  My parents had little of this stuff, and what little they had was often decades old - each year, the modest displays would be taken down and packed away carefully for next year, until as the years went by, much of it fell apart or interest was lost.

So why do other people feel the need to go "over the top" with holiday displays?  Well, like all consumerism, it is a way of drowning the deafening silence in their lives.  People claim to be miserable, living from "paycheck to paycheck" and pessimistic about the future.  But a holiday!  A chance to forget your troubles and celebrate - by adding to your troubles via credit card debt.   It really makes no sense to me at all.

Problem is, it becomes a competition over time.  You put up some Indian corn husks and a pumpkin and your neighbor adds a light string. You counter with an inflatable ghoul, and they top you with two inflatables with animated features. So you put up talking headstones, and they add a skeleton.  It becomes the war of Halloween decorations.

Meanwhile, those who don't participate in this madness are shamed for "not having the holiday spirit" or some such nonsense.

Many fundamentalist Christians, of course, object to all of these types of displays. They claim that Halloween glorifies Satanism and the occult.  They claim that the commercialization of Christmas and Easter, along with the secular characters of Santa and the Easter Bunny, trivialize the religious aspects. And they may be right about that - or maybe they have found the perfect excuse to cheap-out on the whole deal, which is alright with me.  "Sorry, kids, no trick-or-treating this year - that's Satan's playground!"

And no, that wouldn't make you a bad parent.   Not indulging your kids' every whim isn't necessarily a bad thing, even if the other kids mock them for not having the best costume or the most wicked decorations.   Just buy the brat a bag full of candy and let him go into insulin shock - it's a lot cheaper.

Don't feel the need to buy yet more holiday crap every year.  It's OK to just drag out last year's junk and be done with it - or do little or nothing at all.   And that is the interesting thing - much of the "modern" holiday decorations, from inflatables to light strings, rarely survive more than a year or two.  The second or third year, an inflatable loses its gas, and becomes tattered, torn, dirty, faded, and mildewed.  The simpler holiday decorations of yore lasted for generations - often handed down from parent to child.

But again, we had a lot less "disposable income" back then - in fact, the idea that money was disposable was an anathema to us.  How times have changed.

Of course, this is not limited to holidays anymore.   You can also be the "Sports Superfan" and decorate your house, your car, and even your face in your team's colors - year-round.  Or you can devote your life and your basement to a singing star or actor, filling it up with paraphernalia, posters, and memorabilia - some of which may actually be real - all for low, low prices, on eBay or whatnot.

And while maybe you'll never actually accumulate wealth, get out of debt, or be happy, you can marvel at how perfect your decorations are.   Or maybe not.   The choice is yours - and in life, we still do have choices.

Home Fryers? Uh, No.

There are some foods best left for special occasions when dining out.  Trying to replicate a restaurant experience at home is often fruitless.

I am noticing a lot of "healthy food fryers" on the market.  My mail-lady has one, and I see "air fryers" on the shelves at Walmart. This reminds me of the trend a few years ago (decades ago?) when the "Fry Daddy" hit the market.

Generally speaking, small special-purpose counter-hog appliances are pretty worthless and an unnecessary expense, storage hassle, and cleaning hassle.   For example, when Mark worked at Williams-Sonoma, and later at Sheets 'n Things, we got a lot of this junk as people would buy them, and thanks to a generous return policy, bring them back, where they would be marked down to nearly nothing and then sold to the staff for a few dollars.  You wonder how retail chains like that stay in business!  Oh, right, that.

These sort of appliances are not all that expensive - often less than $100, sometimes less than $25.  But some, such as the fancy coffee makers, can run into the thousands.  Our overly-intense coffee guy suggested that spending a couple of grand on such a coffee maker was a "good investment" over time, as they are well-made.  Maybe so, but I will be content to be a coffee plebe with my 99-cent thrift shop stove-top percolator, which has no moving parts.

We still have some of these appliances, sad to say.  They reside in a cabinet in the garage, rarely used.  A 50-cup coffee maker - from Mark's catering days, and a Panini press. The latter is used rarely and makes a big mess and is a PITA to clean - and never really comes clean, as melted cheese and butter tend to bake on to surfaces.  Long gone are things like the espresso maker (the stovetop variety works just as well if not better - no Cuban kitchen is without one!) and popcorn maker and waffle iron* and whatnot.  And yes, decades ago, we had a "Fry Daddy" given to us as a gift or hand-me-down from a friend.  We used it twice and then tried to clean it.   Forget that!

That is the problem with this stuff.   Deep-fried foods are, of course, not good for you.   But it is hard to deny that deep-fried onion rings or shrimp or french fries are yummy.   This does not mean you should eat them every day or try to make them at home.   Trying to home-make fried foods is not only messy, it just isn't the same.  The restaurant has a deep fryer that is on all the time, basically. They have gallons upon gallons of fryer oil, and can "drop" an order of rings or shrimp and have them ready in a matter of seconds.

Meanwhile, your "Fry Daddy" takes an hour to heat up, and even then, is not has hot as the one in the restaurant.  In addition, being so small, it has a pathetic capacity for food.  Unless you like making one french fry at a time, forgetaboutit.   And when you are done, what do you do with all that congealed cooking oil?  Dump it out or let it go rancid?   The restaurant has a contract with a company that literally comes and pumps all that stuff out.  You have the unenviable job of trying to put that glob in a old coffee can or whatnot.

A far better approach - in my mind - is to save those sort of foods for a special night out.   Let's face it, it's bad for you anyway, so eating that junk at home is a bad idea from the get-go.   Trying to mimic a restaurant meal at home is nearly impossible to do.

Now, granted, some things are indeed possible.  Potatoes, if sliced thin and placed on a cookie sheet with some oil, can be fried in the oven.  Frozen hash browns seem to work the same way in a toaster oven (and far less oily).  But frying on the stovetop?  What a neat way to make an utter mess of your kitchen.  And I am not sure an "air fryer" is going to be any better - you might as well just get out a hair dryer. Besides, all those dealies are is just a convection oven on steroids. You might as well buy a toaster oven with a convection feature - at least it is not a single-purpose appliance.

The air fryer has all the markings of a fad.  They are selling this on the premise that it is "healthier" when in fact, the most unhealthy part of a plate of french fries is all the starch in the potatoes, not the vegetable oil used to fry it.  Fat does not make you fat, and low-fat diets are appropriate for people with certain medical conditions.   However, eating a plate of french fries, even if cooked with a hair dryer, isn't going to make you healthier or lose weight.  Massive amounts of carbs are bad for you, period.

But if you are going to eat them, save it for a special occasion, and get them fried the real way, not hair-dried.  Because let's face it, if you are going to sin, at least sin right.  There is nothing worse than trying to sin on the "lite" side.  It just makes you crave the real thing even more.

Leave the air fryers on the shelf, next to the quickie-pots or whatever was last years' trendy appliance (the rotisserie chicken cooker from Ronco?).  No, they are not going to "change your life forever!" as they promise on the television.   They will just make you a little poorer and increase your credit card debt a little bit, and make you a little more depressed as you realize your life hasn't changed much at all, other than to reinforce the notion that you are a sucker and further in debt.

That's how middle-class people go broke - one $50 credit card charge at a time.  Or in the case of an air fryer, $75 to as much as $400.   Ouch.

*MEA CULPA:  A reader writes that he would not part with his mother's antique waffle iron. I agree, and if I had my mother's 1948 Sunbeam which she received as a wedding present, I would probably hang on to it. choose your counter hogs wisely!

Friday, October 23, 2020

Obligatory Post Pandering to Social Trends

 


Is Fake Better Than Real?


America is the land of fake - we seem to enjoy the simulacrum more than the original.

I was at a friend's house and they were serving dinner.  I was kind of amazed at how many artificial foods they preferred.   No butter, but something called "I can't believe it's not butter!" which I had no trouble believing was not, in fact, anything close to butter.   Instead of salt and pepper, they had "Mrs. Dash" because salt is bad, um-kay?   And so on down the line - beverages sweetened with chemicals that tasted sort of sweet, with a metallic aftertaste.   Of course, in America, the "real" sweetener is something made in a laboratory called "high-fructose corn syrup".

They didn't make coffee, but rather put some sort of a cartridge in a machine - and another one for their insulin pump.  I guess it is an improvement over the "instant" coffee of my Parents' era - but not much of one.

And hair.  My friend has her hair done up in a manner favored by the previous generation - the expensive "hair-do" and perm - and hair coloring - the latter of which has been linked to breast cancer.   Funny thing, she stopped doing all that and her natural hair looks better than it ever did when teased, permed and colored.   

We love fake in America.   Why go to messy old Europe when we have a plastic imitation you can visit at Disney World?  It's almost the same thing - maybe better - without all those smelly foreigners and their weird old languages and suspicious foods.   Just good old American lite beer and McDonald's -which sadly, you can obtain rather easily, even in France.

Even people are fake in America.  Women have fake boobs, men have "male enhancements".  We color our hair, we have our faces lifted.  We obsess about our appearance and what we wear and use - and buy fake knock-off clothing to try to fit in.

It makes me very sad.  Because fake isn't better than real.  Fake butter - margarine - was suppose to be good for your heart by "reducing fat".   Turns out, fake butter was full of trans-fats which was about as healthy as shooting yourself in the heart.  All down the line, these ersatz imitations turn out not only not better than the originals but far worse - not only in appearance and taste, but in terms of toxicity and impact on the environment.

Butter isn't bad for you, if, like anything else in life, it is used in moderation.   Slathering on fake butter because "it is low in fat and calories" isn't changing much in your world, as the excess fake butter far exceeds any harm from a moderate amount of the real stuff.   Guzzling down four or five "lite" beers isn't better than having one or two really good glasses of beer.   That is all that fake allows you to do - give you permission to over-consume.

Of course, this is nothing new.  My parents' generation embraced and invented fake.   They felt that anything processed, from a package, and from almighty American Industry was better than some organic home-made deal.   Sugar, rice, flour, salt - all should be highly processed and white, white, white!   Chocolate should have milk in it, and taste bland and have the texture of a light plastic.  Coffee should be made instantly - from a powder!   Maybe it was the war years that caused this - everything had to be packaged for K-rations and made so it wouldn't spoil for decades.

My Mother, for example, always bought Birdseye frozen vegetables, which came in a square frozen block.   Even when fresh vegetables were in season, she bought frozen, as it was "superior" to some grubby vegetable from a farm somewhere.   No bugs in the Birdseye!  It was thought to be modern and sophisticated (and a sign of status) to be able to buy frozen foods - or so the ads from that era said.

Food was something that came in packages, pouches, jars, and shrink-wrap.   It wasn't something that people made or that came out of the ground.

This is not to say you should churn your own butter - leave that to the Amish.  It is only to say that an ersatz version of anything isn't going to be as good as the real thing - and certainly not better.  In fact, such things may be harmful to your health.

Whenever you find yourself trying to substitute a fake for an original, ask yourself why.  Are the promises that the fake will be "better" than the original really going to hold true?  And if you can't, for health or other reasons, indulge in the original, is a fake replacement really going to be satisfactory?  If you are going Vegetarian, the answer isn't fake meat, but to embrace vegetables.

But Americans don't get that.

Voting is a Group Effort


Like building a pyramid, it takes more than one person to accomplish great things.

A recent article online illustrates the ham-handed attempts by the far right to swing the election.  It is one of a number of similar articles appearing in right-wing media, arguing that voting doesn't matter, so don't bother voting.   One of the most absurdist arguments made in the article is that the odds of your vote determining the outcome of an election (e.g., one candidate wins by one vote) are millions to one.

But voting is not a solo effort but a group effort.  In ancient Egypt, they built massive monuments by having thousands of people work together in concert.  And contrary to popular view, not all of these people were slaves, but rather citizens of the realm, who felt it was a honor to serve the Pharaoh by building these monuments.  Teams competed against each other to see who could move the most stones.

And it is true, that if one of these hundreds or thousands of laborers dropped out, it wouldn't affect the construction of the pyramid.   But if ten percent dropped out - or fifty percent - then the work would grind to a halt and the other "team" would win.

This is why it is important to win elections by wide margins, and not narrow victories.  Under normal circumstances, even with best efforts, there will always be spoiled ballots and absentee votes not counted, or people who get to the polling place after it closes.   You need to win by more than one vote, or your victory is not assured.

If you can persuade even a few of your opponent's voters not to show up, it could turn the tide of an election - particularly when used in concert with other techniques, such as voter intimidation, misinformation, ballot stealing, legal challenges, closing polling places, late-night legal challenges, and voter confusion.  The Republicans are using all of the above in an effort to cling to power.  And part of this effort is psychological - to get people, using articles like the one above, to think it doesn't matter if they vote or not.

It will get worse as election day gets closer.   All it will take is for one armed "Proud Boy" election "observer" to "accidentally" discharge his AK-47 at a polling place (preferably one favored by Democrats) to shut the place down for a Police investigation, which would take all day and effectively disenfranchise everyone who votes in that precinct (and any attempt to count those voters will be met with one legal challenge after another).

Any business relationship you enter into predicated on a lie, will only go downhill from there - it is one of my "quotable quotes".   But it also applies to political relationships.   What does it say about the GOP that they have to resort to things like putting up fake "ballot drop-off boxes" in California?   I mean, not that such goofy efforts will turn the State's electoral college votes to Trump.   When you have to resort to ham-handed techniques like this, such as having "poll watchers" assault election officials, it makes you wonder - why can't they just win on their own merits?

Oh,right.  If they had to do that, they'd lose.

To win the electoral college vote means winning not just the popular vote, but the popular vote in several key States.  This is not the action of an individual, but a group.   And if enough people drop out of the group, due to messages like the one above, well, we all lose.

Wednesday, October 21, 2020

The Car in a Bubble

If you put your car in a bubble, is it still a car, or just a large paperweight?

Years ago, when I was in to BMWs, I saw on a website, a photo of a pristine 1972 BMW 2002tii placed in a plastic bubble which was inflated with nitrogen.  The idea was, since the owner spent so much time and money restoring the car, why not keep it "pristine" by putting it in a nitrogen bubble?

Of course, it is kind of hard to drive that way.

By the way, the photo above is from a company called "Carcoon" which doesn't use nitrogen, but instead circulates air with a blower and filter, to keep the air dry and dust-free, even in the dusty conditions shown.   Seems like a neat idea, but what a pain-in-the-ass to put on and take off, when you want to actually use the car.

But that is the point - many people with "collector" cars never use them, for fear of destroying their value.  So many cars appearing on Jay Leno's Garage (the YouTube series, please, not the television show!) are never driven by their owners.  One owner confessed that Jay driving the car around the block was the most the car had been driven since restoration.

So what's the point in owning such a car?   I am not sure.  A car is a machine for transportation, not a 4,000 lb paperweight.   I guess some people fall for this "pride of ownership" thing, as if owning something (which often involves merely writing checks) is some sort of accomplishment.  "Hey, I own a really cool car!" they say.  "Oh, can I see it?   Can we go for a ride?"   "Well, no.  It's in a plastic cocoon, locked away in a garage, and if we actually drive it, that destroys its value.  I drove it once, but it wasn't really that fun or comfortable to drive, anyway."

So what's the point?  And why would anyone pay a lot of money for such a "collectible"?   It is an interesting question - people put values on things based on rarity and condition.   A rare painting, for example, may give joy to the viewer, or it may merely be a talisman of wealth, stashed away in a locker somewhere.    The problem with the latter approach is that the item in question becomes only a commodity, and investing in commodities is a tricky business.

Commodities, unlike income-earning investments, have a value based on perception alone.    People think Gold, or bitcoin, or 1960's muscle cars are worth money, so they bid up the price.   But then the perception changes - or the supply increases - and the prices plummet.  And this is why "investing" in collector cars is such a tricky business.  In the 1990's, the dot-com wunderkinds of Silicon Valley all went out and bought vintage Ferraris with their newfound wealth - driving up the price of even plebeian models.   Then the dot-com crash occurred, and suddenly, Ferraris became cheap - well, at least cheaper.

For a while there, people were bidding up the price of 1960's Mustang convertibles to stratospheric prices.  And as you might expect, some clever bodymen bought Mustang coupes and then converted them to convertibles.  Ford actually sells entire body shells for this purpose.   All you need is a VIN number and you can build a "new" old '66 Mustang ragtop from the ground up.   I should have kept the title and VIN plate when my rusted-out example went to the junkyard in 1976.

Of course, original cars in original condition are a rarity, and one reason why "survivor" cars are commanding high prices in the market.   Yes, there are 50-year-old cars out there with only a few thousand miles on them.  Problem is, you drive them, you destroy the value as a low-miles "survivor" car.    And the idea that you can buy a car today, and not drive it and create such a car merely by waiting a half-century is flawed.    Even if you could afford to do this (buying a car when you are 20 and then paying for storage for 50 years) odds are, you might barely recoup your investment over that long period of time.

And anything less than 50 years is just a used car.   I recounted before how I met a young man who bought a 1985 Mustang "anniversary" model and then put it in a garage, thinking it would be collectible.  A decade later, he tries to sell it, only to realize it is just a low-mile used car, worth only a little more than a regular used one.

I recounted before how Gen 5 Corvettes are for sale all day long on Autotrader - some with  under 100 miles on them.    Again, people are convinced that a mass-production vehicle will become a collector's item by dint of low mileage - but it is little more than a 4,000 lb Elvis plate from the Franklin Mint.   In other words, it isn't worth much - other than as a used car.

The bubble mentality is a poverty mentality - the idea that these cars are priceless collectibles, rather than money pits.  The cold hard reality of car collecting is that if you spend a dollar on restoring or maintaining a car, the best you can hope for is to get fifty cents back when you sell it.

And that is no way to accumulate wealth!

The Cowardly Lion


He even looks like Trump!

Trump is a coward.  He is afraid of losing, and that in turn, prevents him from winning.  It is no surprise to me that he backed down on confronting Iran, a 3rd rate country whose "Navy" consists of old motorboats and drones you buy on eBay.  The Iranians called his bluff, and he folded like a cheap umbrella.  Expect more fun and games from our Iranian friends in the near future - and Trump doing nothing about it.

It is like the situation in Venezuela.  Trump doesn't want to get dragged into a war - that is understandable.  But Vladimir Putin has no such qualms.    He is sticking his dirty fingers into pies all over the world, and our response has been - nothing.  While we may decry "intervention" in other countries, Russia and China have no such qualms.   Maybe the lessons of Afghanistan have already been forgotten by the Russians - and maybe that is the plan, to let Russia get bogged down in multiple conflicts around the world, before they too, leave with their tails between their legs.   Maybe.

Afghanistan illustrates how strategically better it is to fund insurgents than to put boots on the ground.  We chased the Soviets out of that country simply by shipping rocket launchers to Mujaheddin.  We let the Russians bleed slowly until they gave up and left.   Then, forgetting the lesson we taught them, we rushed in, only to fight a new generation of insurgents, funded by our opponents. Of course, Afghanistan has taught this lesson to many over the years, including the British.

International politics isn't a polite game of chess, but a bloody back-street brawl.   Each world power peddles influence and tries to affect the outcomes of elections - through legitimate or non-legitimate means, usually the latter.  Each country fuels the fires of discontent in others - including each others' - which it is why it is no surprise to me that Russia is behind so much of this "fake news".   Looking back at the 1960's, so much of the protesting and "movements" of that era seem, well, idiotic.   The Symbionese Liberation Army?  Get real, man.

Trump seems reluctant to play this sort of bare-knuckles game. To him, the height of courage is to storm out of a meeting and shout at people.  But folks figure out that his courage is all bluster and bluff and no real substance.   All you have to do to overcome sanctions or tariffs is to appear to agree with him (or agree to do what you planned to do all along) and then go on your merry way.   Trump declares "victory" which is all he really wanted, to appear to win to appeal to his own vanity - and life goes on as before.   It is like dealing with a child throwing a temper tantrum.   Just give the baby his bottle and walk away.

I mentioned in a previous posting that Ronald Reagan famously took on the air traffic controllers union early in his Presidency, announcing to the union world that it was no longer "business-as-usual".   He fired everyone and many of those folks never got their jobs back.   Do you think Trump has the balls to do something like that today?  He has tried to shut down the government on occasion, but so far, that has backfired (again, he declares victory, although nothing is actually done).

And that is the conundrum for Republicans.  They hold their noses and go along with Trump, figuring they're getting some judicial nominees out of the deal, and maybe some rollbacks in regulations.  But when it comes down to the real fight, Trump chickens out, and falls back to his "art of the deal" strategy - to declare himself the winner and call the bargain "fantastic" and then go home and live in his fantasy world, where he is an astute businessman and a "great builder".

This is not to say we should invade Venezuela or Iran.  Americans have little appetite for videos of hostages pleading on television - as happened in 1979.  But while Iran fuels Shiite insurgencies all over the Middle East, what are the Sunnis doing?   Why are we not shipping shoulder-mounted missile launchers to the opponents of the Iranian regime?

Perhaps that is a bad idea - it would only fuel violence and destruction.   But on the other hand, when only one side is doing so - the side opposing us, it doesn't take a rocket scientist to figure out how this will end.  And you need only look at the outcome in Syria to know this.

It seems just as the Soviets lost the taste for international intervention after their fiasco in Afghanistan, we have similarly lost our appetite for being the World Police.  Nature abhors a vacuum, however, and others are steeping in, where we retreat.

Eventually, we will be called to intervene, at a time and place not of our choosing, and after the situation has worsened to our disadvantage.   It is sad that it takes a Pearl Harbor or a 9/11 to force us into action, long after we should have.  Spank the baby now, maybe you don't have throw him in jail as an adult.

Who Sets Prices? - You Do, To Some Extent

Prices are not determined by the seller but rather by the marketplace.

Many people are under the misapprehension that prices are determined by retailers and manufacturers.  Nothing could be further from the truth.  A lot of people believe that manufacturers add up the cost of materials. labor. and overhead and add on a "reasonable profit" and this becomes the retail price.  The reality is, the price of goods is determined by the marketplace, and this means sometimes a manufacturer or retailer makes an awful lot of money on a product because people are willing to pay far more for it than it cost to make, or sometimes they actually lose money on a product because what people are willing to pay is less than what it cost to make the product.

For example, if you want to buy a pickup truck or an SUV, the manufacturer is more than happy to sell them to you because they make a lot of money on these - thousands if not tens of thousands of dollars each.  On the other hand if you want to buy a small car, they may actually break even or lose money, which is why in American car manufacturers have stopped selling small cars.

Of course, sometimes manufacturers will sell products at a loss if there are other business reasons for doing so.  For example, in the early days of the Thunderbird, they said that Ford lost money on each car they made.  However, the car had a "halo effect" that drove people to the showroom to look at the car.  Once inside the showroom, they would realize the car was impractical for a family of four and then salesman can then steer them toward the brand new Ford Fairlane.

But in general, unless there is some business case to be made for losing money on a product, most companies eventually stop manufacturing products that cost more to make than the market will pay. 

We have a friend that likes to go shopping, and she regales us with the amount of "savings" she got on something she purchased.  She'll buy something for $3 and crow that it was "70% off the retail price!"  But of course, this "retail price" is just a made-up number, often figured in advance to be discounted heavily later on.   Manufactures and retailers don't set prices, they put prices on things at a price point where they will sell.   And oftentimes, this means different prices for different customers - some paying the "full retail" while others seek out discounts.   But even discounted, often there is a profit to the retailer and manufacturer, just not as big a profit as at regular retail prices.

But of course, you cannot "save money" by buying something on sale, you are only spending money.  And if you are spending money on something you don't really need, because it is "on sale" then you are merely wasting money.   For example, I have two yard carts, one of which I bought online and an identical one a neighbor gave me.  They work well, but the axles rust out, and so I replaced the axle on one of them.   The other day, I was in the store and saw in the "closeout" bin a wheel for these yard carts, marked down from $16 to $3.   Who would buy a yard cart wheel in the first place?   But I thought, "Hey, I already replaced an axle on one of these, and who knows, I might need a wheel someday, and I'll never find one at this price!"   So I wasted $3 on a wheel I likely will never use.

Others are convinced that sellers can dictate prices to the marketplace which is also not true. Mark once listed a house for sale in Holland Hall in Alexandria, Virginia and a neighbor called him to complain that he priced the house too high.  She argued that since the house was priced so high, her property taxes would go up, and that it was unfair of him to sell the house for that price.

But like any good real estate agent, he had researched the market carefully and determined what a good price would be for the property, based on other sales in the area of comparable homes.  In other words, what other buyers were willing to pay.  If you overprice a house, it won't sell regardless of whether you want to sell at that price.  Sellers cannot dictate to the market what prices will be.  And when a house is overpriced and it remains on the market for too long, a real estate agent might end up losing their commission if the seller gets tired and hires a new agent.

A similar thing happened to a friend of ours who was trying to sell their condominium in Florida. The realtor real estate agent over-priced the property, and now she's reduced the price by $100,000.  Regardless of what she and the real estate agent thought the property was worth, the market thought otherwise.  You cannot dictate arbitrary prices to the market.

This is one reason I say to walk away from dreamers or the perpetual "for sale" people who claim they have to get "their price" - as if they are entitled to more than market value by dint of their saying so.

Of course, under the law of agency, the seller dictates the asking sales price. The seller should rely on the advice of a real estate agent and figure out what is a reasonable price to sell the property within a reasonable amount of time. Unfortunately, a lot of people are convinced that sellers do dictate prices and get into a lot of trouble when they go to sell their home.

For example, another friend of ours went to sell their house and they interviewed three real estate agents. They went with the agent that told them they could get the highest price for their house. Months later the house is still in the market with few showings and no offers. And the reason why is real estate agent over-priced the house in order to get the listing. The agent knew that the seller would go with the agent that told them the highest price, and thus just gave her a high number, hoping she would come to her senses later on and reduce the price of the listing and he would get his commission.

As I noted before, over-listing like this is often short-sighted for the seller. Often what happens is the house sits on the market for months and sometimes even years, until the seller gets desperate and then cuts the price dramatically and sells it for less than market value - at which point it's quickly snapped up by a savvy buyer.

You can't dictate to the market what the price of something is. You have to hope there's a buyer willing and able to purchase at the price you want. If not, well, you have little or no choice but to lower your prices.

And of course there is a limit to this. If people demand lower prices on consumer goods to the point where they cost less than the cost of production, eventually each producer will go out of business or choose to stop making that product one by one. At that point, there will be a shortage of that product which will cause people to bid up prices until equilibrium is again established. The system is self-correcting, although there is a lot of hysteresis in it. At some points in the cycle the seller is losing money on each transaction and some points in the cycle and consumer is overpaying. But overall an agreement is reached between buyer and seller as to what is a reasonable price. One party can't dictate to the other any price they choose out of a hat.

Who Decides What is News?



What you think of as news, isn't.

I have written before about the Nightly News and why it's not worth obsessing about the news.  And yet we all feel compelled to click on certain stories or watch the 24-hour news networks to keep up with the latest goings-on.  But who determines what is the latest going on and what is it?  It's a question most people don't bother to ask themselves.  They just presume the news is some sort of natural thing and that every network reports on the same stories based on the same standards.  This is not the case.

Throughout history and throughout the news process, certain groups and people have decided what is a new story and what isn't. And this these criteria have changed over time.

1.  The Wire Services.  Back in the 1970s my brother worked at a college radio station and I used to hang out there watching him work. He did the hourly newscast, and it was interesting to see how he put them together. They had an old teletype machine which received one of the wire services - API, UPN, Reuters, or the like. This machine would punch out pre-written news stories every few minutes, updating people on the latest goings-on.

My brother would tear these stories off in strips and paste them together on a piece of paper and decide in what order to report the stories, and which stories would be reported.  He would then mark-up the pre-written text or write his own text based on the wire service news report. At the top of the hour, he would deliver his 5 minute newscast summarizing what he felt were really important news events of the hour.

As you can see, there number of filtering elements here, the most important being what the wire service determines is important as news. If the wire services don't say something is news, then it isn't - or at least it wasn't back in those days. Next, the actual reporter or the news team or whatever would then decide which stories were important and what order to present them and how much emphasis to place on each story. So there's a secondary filter in effect here, where the newscasters or newsroom staff determines what is news and what isn't.

2. Reporting.  Reporting has really fallen from  favor in recent years, as it is very expensive to hire and pay reporters on the longshot premise that they may come up with a worthwhile story. But back in the day, major newspapers had armies of reporters who fanned out across the city and the nation and the world to uncover news stories, write them up, and report them back to their papers. Many famous writers made a living operating foreign bureaus and reporting on foreign news for American papers. For example Ernest Hemingway, among others, reported the European news for American newspapers.

As you can imagine, as newspaper readership declined and costs increased, the number of reporters and "foreign bureaus" a paper could afford to keep on the payroll started to shrink. Some freelance reporters would go out and find stories they felt they could sell to the papers, but those were a very small number of people. And moreover, papers didn't want to pay much for the stories. Plus, it was not a very cost-effective proposition for a freelance reporter to try to find a worthwhile story that someone would pay money for.  And it goes without saying that a story needs to be juicy or made juicy for a paper to pay for it.

3. Press Release News.  I wrote about this before, how organizations will put out press releases which newspapers and television outlets will seize upon and reproduce word-for-word. If you have catchy animated graphics, so much the better. So, for example, if you have a catchy animated graphic illustrating a rotating skyscraper or air-powered car that you've come up with in your imagination but have never really made a working model of, the news media will report this as the "Next Big Thing!" to tantalize viewers.

With the cutbacks in reporting, press release news has really taken over. The danger of press release news is it allows people who are not part of the news organizations to decide what is and isn't news. And what gets chosen is news is what is basically eye-candy. News outlets love press release news because it's inexpensive - in fact, it's free. You just have to pay for a little rework in post-production and you've got yourself a news story for a nearly next-to-nothing in cost.

4. Clickbait News.  Following closely on the heels of press release news is clickbait news. In recent times, clickbait news has taken over. Rather than determining what is newsworthy and what isn't - or at least what the editorial board feels is newsworthy, the news outlets try to figure out what people want to see and then report that instead. This is arguably the most dangerous form of news reporting possible.

In recent times, it is all about Trump, which is why the news outlets love him.  It doesn't matter if you hate Trump or love Trump, you'll click on an article about his latest outrages either way.   This isn't news, per se, it is the medium that Howard Stern pioneered.   People listen to him for an hour because they love him.  People who hate him listen for two hours.   The bottom line is engagement - getting people to click on articles and to be outraged and upset.   You make more money this way, as advertisers pay more for sites that engage readers.

There is a fine line, of course.   Some Fox News stars have seen their ad revenue plummet as they cross the line from edgy to unspeakable.  In a way, it is like comedians - being funny means pushing the envelope, but it is a tricky deal.  You push too far, and you are seen as racist or sexist or just ugly and not funny.

5. Twitter.  The latest and worse form of news reporting - perhaps even worse than clickbait news - is Twitter-based news.   Few people actually are on Twitter - I'm not, and you probably shouldn't be either.   But because the people employed in the media are all on Twitter, they view what happens on Twitter as "news".    You and I have read thousands of tweets over the years, not because we are on Twitter (we aren't - right?) but because so many news stories these days are based on tweets and include tweets in the body of the story (often annoyingly once as text, and again as an image, and again as text, in case we missed it the first time).

Like with press-release news, Twitter-based news is often based on what other people want reported as news.  President Trump is genius at this (evil genius, but genius nevertheless) often changing the subject of the national debate by simply dropping a Twitter-bomb on the American public, or at least the American media.   By doing so, he changes the subject and often "buries" a real story.  So instead of talking about the migration crises, or the impending debt ceiling cap (and the problems with the national debt), the media, the public, and the Democratic party are all upset about tweets.   Mission Accomplished.

6.  Rumors and Fake News Sites:   Trump has used the term "Fake News" to describe the mainstream media.  But prior to that, a host of sites have popped up (and pooped out) that print "news" articles that are little more than parodies or made-up rumors.  Inforwars is the best example of this, and its host has admitted that his abrasive "persona" and the stories he tells on the air are just an act, not real news.  Or at least that was the pitch he made in divorce court while trying to get custody of his children.

These sort of internet rumors and conspiracy theories have thrived because of the demise of real news.  When all you read on a "mainstream" site or show is press releases, barf-ups of Tweets, wire service reports, and click-bait nonsense, people become starved for real news.  They want to know what is really going on, but those sorts of stories get buried in a flurry of what the President Tweeted yesterday or what some company said in a press release, or what some Pol said in a carefully scripted "press conference" - the latter of which is barfed-up obediently by the mainstream press (and we criticize other countries for their "State Media"!).

Unfortunately, fake news is filling this news vacuum.   And it isn't so much a vacuum as the sugar-coated click-bait and other nonsense drowns out the real stories, which don't get clicked on, watched, or read - but instead pushed to page six.  Watergate today, would be relegated to the back pages of the Washington Post as some sort of bumbled burglary.   No one would put such a boring story on the front page anymore - no one could follow it!

* * * 

This sounds pretty bleak - is there hope for "the News" anytime soon?   Well, the good news (if you'll pardon the pun) is that this whole thing isn't driven from the top-down but from the bottom-up.   We get click-bait stories because we click on them.  And yes, it is tempting to click on the latest "Did you hear what Donald Trump Tweeted last night?" stories - but every time you do, the company that printed that story makes a penny and some computer somewhere logs your click and an algorithm determines that that is the sort of dreck you like to read and watch.   So you get more of it - we all get more of it.   But in today's internet-enabled news, you in particular, get more of it, as they can tailor your "feed" based on what you already looked at.

But ultimately, the problem isn't the news - it is us, for consuming the dreck they call news today.