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To go from homeless to famous in a few days is a consequence of providence working through a free press and a free market. Ted Williams is a lesson in freedom.

(1) Columbus newspaper post video of Williams
(2) Private citizen posts newspaper video on youtube (now with 11.7 million views)
(3) CBS news has Williams in the studio; flies him home to see his mother (on Delta airlines)
(4) Cleveland Cavaliers offer Williams a job and house

Government welfare, a state-run press, and wealth redistribution could not have created this 3-day story. No way. Just sayin' . . .

The Global Cities Index 2010

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hongkong.globalcities005.jpgHong Kong by Mike Clarke, shown in this slideshow

Foreign Policy, A.T. Kearney, and the Chicago Council on Global Affairs got together and published their list of the top 65 global cities. Here's their top 10:

1 New York
2 London
3 Tokyo
4 Paris
5 Hong Kong
6 Chicago
7 Los Angeles
8 Singapore
9 Sydney
10 Seoul

Conventional wisdom says that China is so hot right now, but Beijing only came in at #15. The underlying methodology of this list factors in business activity, human capital, information exchange, cultural experience, and political engagement. Curiously, one of the human capital metrics is the size of a city's immigrant population. Shouldn't there be a more intelligent way to measure the immigrant contribution?

Crisis of Equality?

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Ezra Klein wonders if financial crises like the one that sparked the recent recession could be caused by increasing income inequality. In case this thought doesn't carry enough economics gravitas on its own, Klein is really just following up on the ponderings of Nobel-prize winning economist Paul Krugman.

It's an interesting idea, but as Klein points out, it's not easy to sort out why things should work that way:

The problem, he says, is finding a mechanism. Krugman brings up underconsumption (wherein the working class borrows a lot of money because all the money is going to the rich) and overconsumption (in which the rich spend and that makes the next-most rich spend and so on, until everyone is spending too much to keep up with rich people whose incomes are growing much faster than everyone else's).

I think Krugman would admit that these options aren't very satisfactory, since consumption isn't some outside force acting upon the economy, but an integrated part of it. Which is to say, it's not really a cause, it's a symptom. Klein's argument is a bit better, since the "supply of idle money" can increase purely by the policy whims of the central bank (or by discovering gold if you're on the gold standard). This chain of reasoning, easy money -> easy credit -> mal-investments (or asset bubbles) -> crash, is the workhorse theory for economists of the Austrian school of thought. Klein simply points out that the mal-investment problem, investing in projects that are at unusually high risk of going bad, could be made worse in situations with higher income inequality. So does this mean you should believe Klein's story?

From Andy Xie on China's policies

Powerful interest groups have paralyzed China's macro policy, with ominous long-term consequences. Local governments consider high land prices their lifeline. State-owned enterprises don't want interest rates to rise. Exporters are vehemently against currency appreciation. China's macro policies have been reduced to psychotherapy, relying on sound bites and small technical moves to scare speculators. In the meantime, inflation continues to pick up momentum. Unless the central government bites the bullet and makes choices, the economy might experience a disruptive adjustment in the foreseeable future.
More here.

HT Paul Kedrosky

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Can you Turn Violent Offenders into Entrepreneurs?

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Julia posted about Prison Entrepreneurship in the comments of my "Do We use Thought as Decoration?" I thought I would share it and encourage everyone to watch the excellent video.

Julia - "I was thoroughly impressed with them through the interview process (I communicated with their chief of staff, not Catherine Rohr herself). My biggest takeaways: 1. They emphasize being good husbands and fathers as well as entrepreneurship. 2. With their help, 97% of their graduates are employed within four weeks of leaving prison. 3. They are unrelenting in their high standards and will call the police to have one of their graduates rearrested if he "backslides." 4. They provide nearly weekly social events for graduates that offer encouragement and accountability. 5. Catherine Rohr and her team are motivated (in my opinion) not by self-congratulatory do-gooderism, but by authentic, God-breathed vision for the people they reach. If you haven't watched this speech she gave, it rocks:"

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200 Chicago Ministers Back South Side Wal-Mart

More info here. I have yet to hear any opposition to wal-mart that is based on anything but economic ignorance (or, possibly, ill-will toward the poor disguised as concern for them).

I'm willing to bet that there aren't any Presbyterians among those 200, however.

Fascinating.

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Interactive Netflix DVD rentals, by region and zip code.

This is probably only interesting if you know an area. For me, the DC area is intriguing.

Paul Blart
Appaloosa - the darkest color is Fort Meyer. Keep your eye on that one little zone as you click through the movies, and it's funny to think that it's a bunch of military dudes (well, and some women, as well, but mostly dudes) there--not surprising that they're not all that interested in Mad Men.

I have seen exactly zero of the top ten movies in my zip code, 20007.

priest.jpg.display.jpg WORSHIPPERS at one York church got a shock when their parish priest used the last Sunday before Christmas to advocate shoplifting.

Father Tim Jones, parish priest of St Lawrence and St Hilda, broke off from the traditional Nativity story yesterday, and said stealing from large national chains was sometimes the best option many vulnerable people had.

He told the congregation: "My advice, as a Christian priest, is to shoplift. I do not offer such advice because I think that stealing is a good thing, or because I think it is harmless, for it is neither.

"I would ask that they do not steal from small, family businesses, but from large national businesses, knowing that the costs are ultimately passed on to the rest of us in the form of higher prices. I would ask them not to take any more than they need, for any longer than they need." (full article here)

When I read this and compare it to what I've recently learned from Matt Chandler and John Piper on suffering well, I cannot but grieve for the Church. We are missing it completely...we are completely irrelevant as we have succumbed to worship the exact same things the world does, except we throw in a couple of verses to butter it up and make it an easier pill to swallow.

I trust that worshippers at St. Lawrence and St. Hilda have read their Bibles and quickly dismiss this offense to the Gospel and I hope this sort of "ends justiflying the means" mentality is removed from our churches.


Thoughts?

Christians and the Housing Bubble

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Christians and their utopianism:

Many explanations have been offered for the housing bubble and subsequent crash: interest rates were too low; regulation failed; rising real-estate prices induced a sort of temporary insanity in America's middle class. But there is one explanation that speaks to a lasting and fundamental shift in American culture--a shift in the American conception of divine Providence and its relationship to wealth.

Add water, an oligarchical Fed/Congress/Wall Street, and vibrant multiculturalism!, mix, and wait for collapse.

Daily Readings

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"Distance is Not Dead: Social Interaction and Geographical Distance in the Internet Era" (arxiv.org)
"Are People Willing to Pay to Reduce Others' Incomes?"(warwick.ac.uk)
The Best Site for Men's Clothing and Interests. A Continous Lean

Valerie Elizabeth is challenging women all over with her "Little Black Dress" challenge. She has been wearing for the entire month of August the same dress every day and is showing us all -girls and guys- how with a little creativity we can still look well without going overboard in spending on new clothes. This is an awesome initiative. You can check out her diary on:
www.societystylist.com
www.elligrace.com
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Yo! I'm selling swag!

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I may also be selling swagger. :)

My CafePress Store. This is purely my own venture, and I'm totally using this blog post as a platform to get my name out there. :) I'll be updating the store as I come up with more ideas, but there are a few there now.

/shameless plug

In addition to the buckets and buckets of dough that I'll be making when the millions of you lurkers go purchase dozens of my t-shirt designs (also mugs and a sticker or two...), I'm also starting my own planning/architectural graphics firm. All KINDS of entrepreneurial ventures going on. I've got 4 more classes for my degree, so I'm going to make sure I take that which I'm most interested in...with the time left, I'm enjoying being creative again. Econ certainly *is* great, but I do miss producing pretty things.

I shouldn't need to mention this...

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blackboard.jpg...and, heck, I might not need to...

The broken window fallacy.

Move along if you know what this is. If not, boy are you in for some disappointment (with the vast majority of government programs in general, and economic 'stimulus' packages in particular).

Discussing the debacle that is the Cash for Clunkers program, Mark Perry links to a Cato piece that discusses some of the program's...umm...shortcomings (I'm being as charitable as possible).

We're not necessarily concerned with the C4C program here, though it should be lambasted and ridiculed as often and as loudly as possible. We're more interested in an excerpt from Henry Hazlitt's apparently-excellent short book, Economics in One Lesson, which I have yet to read. I have read Sowell's similar piece, Basic Economics, and flipped through his shorter treatment of the general topic, Economic facts and fallacies. I can wholeheartedly recommend anything Sowell writes, and I know Anthony would too.

Back to Hazlitt: a commenter on Mark Perry's blog included an excerpt out of Hazlitt's book. This refers to the 'broken window fallacy,' originally put down by Frederic Bastiat a couple hundred years ago in France. Yes, econ is relatively timeless...at least, the principles are...we keep trying to find new ways to make it make sense...

The Broken Window

A young hoodlum, say, heaves a brick through the window of a baker's shop. The shopkeeper runs out furious, but the boy is gone. A crowd gathers, and begins to stare with quiet satisfaction at the gaping hole in the window and the shattered glass over the bread and pies. After a while the crowd feels the need for philosophic reflection. And several of its members are almost certain to remind each other or the baker that, after all, the misfortune has its bright side. It will make business for some glazier. As they begin to think of this they elaborate upon it. How much does a new plate glass window cost? Two hundred and fifty dollars? That will be quite a sun. After all, if windows were never broken, what would happen to the glass business? Then, of course, the thing is endless. The glazier will have $250 more to spend with other merchants, and these in turn will have $250 more to spend with still other merchants, and so ad infinitum. The smashed window will go on providing money and employment in ever-widening circles. The logical conclusion from all this would be, if the crowd drew it, that the little hoodlum who threw the brick, far from being a public menace, was a public benefactor.

Now let us take another look. The crowd is at least right in its first conclusion. This little act of vandalism will in the first instance mean more business for some glazier. The glazier will be no more unhappy to learn of the incident than an undertaker to learn of a death. But the shopkeeper will be out $250 that he was planning to spend for a new suit. Because he has had to replace the window, he will have to go without the suit (or some equivalent need or luxury). Instead of having a window and $250 he now has merely a window. Or, as he was planning to buy the suit that very afternoon, instead of having both a window and a suit he must be content with the window and no suit. If we think of him as part of the community, the community has lost a new suit that might otherwise have come into being, and is just that much poorer.

The glazier's gain of business, in short, is merely the tailor's loss of business. No new "employment" has been added. The people in the crowd were thinking only of two parties to the transaction, the baker and the glazier. They had forgotten the potential third party involved, the tailor. They forgot him precisely because he will not now enter the scene. They will see the new window in the next day or two. They will never see the extra suit, precisely because it will never be made. They see only what is immediately visible to the eye.

The seen is what is always touted by the politicians. The unseen is what economists are often tasked with reminding everyone of. This is the essence of tradeoffs, a word that can't be repeated enough. This is why economics are important in whatever conversation you're having, whether that be about the economy, environment, or anything else (whoever asked that the other day on Brian's post about consensus and the environment, sorry I didn't comment there).

The commenter at Mark's blog also included the following postscript, which I'll include, as it sizes up the situation rather well:

People who are ignorant of economic knowledge love programs like the cash for clunkers fiasco because they do not account for what is not seen. While they see a benefit as the Ontario Toyota plants sell more vehicles to American consumers they do not see the fact that the local garage has less work because cars that would have been repaired have been taken off the road. While they see Avis get a better price for its used cars they do not see that consumers that could only afford a clunker see their prices increase because of the destruction of supply. While they see dealers see their receipts increase they don't see charities, which sold donated cars see their receipts go down. And so on, and so on, and so on,...

I am sorry my friend but destroying value is never a good idea, particularly when the nation that is choosing to destroy value is bankrupt.


Now, I (Shawn) actually don't think that the nation is 'bankrupt,' per se, but the point still stands w/o that bit of hyperbole.

Does Beauty Sell?

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Now here's some news I can totally relate to and one that might just make retailers think twice before hiring salespeople for their looks.

A recent study at the University of South Australia found that women between the ages of 18 and 26 were less likely to buy if they thought the salesperson was more attractive than they perceived themselves to be. This is because women are "biologically competitive" and the idea that another female is more attractive influences their behavior, said Bianca Price of the University of South Australia, in a story that ran in Retail Week.
Read the rest here.

I can just imagine all the consultants preparing their new "ugly sells" pitches....I mean...really?

Biomimicry in Action

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If nature spent millions of years solving problems you would think we could learn something, right?

Janine Benyus is one of the leading thinkers on Biomimicry. Enjoy

Fantasy Football

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That picture is misleading. I meant the fantasy football that 10 million people play, the fantasy football that costs US employers around $8 billion per year in lost productivity:

Consultancy Challenger, Gray & Christmas Inc cited a recent report that suggests the average fantasy football player spends 5.2 hours online each week participating in such games, which are offered by ESPN, CBS Sports and Yahoo Inc, among others.

Challenger pointed to another report that found 60 percent of fantasy sports fans spent more than an hour each day just thinking about their fantasy team.

"There are some people who probably wait until the workday is over to strategize, make trades and manage their teams, but many are probably doing at least some of their team tasks from the office," Chief Executive John Challenger said.

When I was an engineer, the only that curbed my fantasy football strategery during work hours was my realization that God was my boss. Without that, what's stopping you?

Last year, my team featured AD (All Day, from his Sooner days, is better than "AP"), Turner, Anquan, Andre Johnson, Hines Ward, Kevin Smith, and Greg Olson (whom I later packaged with an injured Tony Romo to get Tony Gonzalez and the surprisingly serviceable Tyler Thigpen). Suffice it to say, I won my league.

I'm glad Vick and Favre are back even though they may hurt the Bears chances. But when should they be drafted in a 12-team league? Anyone wanna talk sleepers?

I will now shop at Whole Foods

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This line from a story on ABC.com caught my eye:

"I'm boycotting [Whole Foods] because all Americans need health care," said Lent, 33, who used to visit his local Whole Foods "several times a week."

Whole Foods must be doing something right to piss this guy off. The prices at Aldi's and Trader Joe's are more my style, but I have to support a CEO who publicly says this:

While we clearly need health-care reform, the last thing our country needs is a massive new health-care entitlement that will create hundreds of billions of dollars of new unfunded deficits and move us much closer to a government takeover of our health-care system. Instead, we should be trying to achieve reforms by moving in the opposite direction--toward less government control and more individual empowerment.

John Mackey, CEO of Whole Foods, backs up his stance by pointing to his company's excellent health benefits. He goes to list some good ideas, then throws this in:


Health care is a service that we all need, but just like food and shelter it is best provided through voluntary and mutually beneficial market exchanges. A careful reading of both the Declaration of Independence and the Constitution will not reveal any intrinsic right to health care, food or shelter. That's because there isn't any. This "right" has never existed in America.

What? I'm not sure what he means by his later use of "intrinsic," but there's more immediately gratifying quotations:

Although Canada has a population smaller than California, 830,000 Canadians are currently waiting to be admitted to a hospital or to get treatment, according to a report last month in Investor's Business Daily. In England, the waiting list is 1.8 million.

Why would Mackey risk angering his socialist-leaning customer base? Is he in bed with medical companies that will collapse under Obama's Ministry of Health, or is Mackey simply acting morally?

Washington vs. Silicon Valley

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If only this was a joke

Here's a stumper: In the Treasury financial reform proposal, who comes in for more regulatory retooling: Fannie Mae, or your average 14-man venture capital shop? If you said venture capital, you understand why one of America's greatest competitive advantages is now at risk in Washington.

As part of their regulatory redesign, Team Obama and Congress still don't have a plan for reforming the giant taxpayer-backed institutions like Fannie that caused the credit crisis. Yet they're moving to rewrite the rules for investing in tiny technology companies that had nothing to do with the meltdown. Under the proposed rules, venture firms will be declared systemic risks until they can prove themselves innocent. The typical venture capital (VC) firm has nine principals plus five support staff and doesn't use leverage. Yet Treasury Secretary Timothy Geithner wants VCs to be regulated as investment advisers by the Securities and Exchange Commission.

This means the firms will be required to send heaps of data to the SEC and be subject to unannounced examinations that can last days, weeks or months. The firms will also have to appoint a chief compliance officer, create written procedures to comply with the various securities laws, and follow new regulations on record-keeping, privacy of client information, marketing, and so on. Information gathered by the SEC will then be analyzed by the Federal Reserve or some other systemic-risk regulator to decide if there is a hidden danger buried deep inside these companies. Never mind that VCs don't trade derivatives, or much else for that matter.read the rest

Wonderful the Treasury wants to regulate the VC industry that uses no leverage and trades no derivatives. The VC industries risk profile is positive to extreme events. When extreme events happen VCs make money. If no extreme event they lose only the equity invested. Yet the Treasury says the VC industry may have Systemic Risk. You have to be kidding me a $28 billion dollar industry that uses no leverage and is positive to extreme events is a risk that can bring down the whole financial industry? Banks have systemtic risk. Banks are negatively exposed to any extreme moves. When you have an extreme event like the credit crunch banks lose not only their money, but also taxpayers money. Banks or any other kind of massive lending is a systemic risk.

Yet the Treasury says that if the VC industry is not regulated then hedge funds will call themselves VCs and leverage up. Hmm, right as the VC industry is held to anti fraud laws this would not be legal. Then another problem the hedge fund industry was not mainly responsible for the crash. The crown of responsiblity is on the heads of Commercial banks and investment banks and the Fed.

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FADEP (The Center for the Study of Family, Population and Development) has recently published in English a study of the impact of strong, united, traditional families on Guatemala's economy and business community. The complete document in English can be downloaded on a PDF here.

As we move through this global economic crisis, strong families are essential, not only in providing the market with truly free and virtuous individuals that can thrive on an even more challenging market place (because of the strong moral character that is only forged within the context of family), but also serve as the strongest support web for those hit the hardest by the crisis.

If we are to survive this crisis, if we are to build strong communities of faith and if we are to re-learn the gospel, the vocation of serving others and the virtues of self-restraint and selfless love, we need to work together in strengthening the family.

The consequences of not doing so are very scary:

P.S.: Feels great to post again!!!!!!

How do you Price Nature Provided Services?

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Pricing signaling is the best system we currently have to value services. It is not perfect. You can have external costs not priced into a product or service. Example industrial pollutants where the cost is paid by society but not the companies and individuals producing and using. AKA the Free Rider problem.

My question comes how can we effectively price the services that nature provides? Giving a incentive for people to not cut down the rain forest (massive carbon sink). Or clear trees by the river which act as pollution filters? Then who pays for the services? How does rain forest farmer in Brazil get paid by Americans?

I know for carbon this is being address to some extent. A farmer in say Brazil can sell carbon credits on the market where any one can buy them. What is not clear is how to value the rain forest itself. With the exchanges in place supply and demand will be an effective price discovery tool. Personally I am not worried about the government setting prices as the market will be way to large. It is projected in the trillions. Ex look how non effective oil and gas price manipulation is. It can be done but not for very long.

We need to build other markets and exchanges for watershed protection, soil erosion, biodiversity and countless other nature provided services

Retail titan Wal-Mart launches 'sustainability index'

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"US retail giant Wal-Mart on Thursday announced plans to develop a database that it said would revolutionize shopping by putting information about products' sustainability at consumers' fingertips.
The database, dubbed the sustainability index, could put information about how environmentally-friendly suppliers, manufacturers and their products are, just a garment label or barcode-scan away for shoppers, according to Wal-Mart executives speaking at a webcast gathering of their suppliers."Read the Rest

Here is a good analyst of the difficulty of implementing Lifecycle Analysis

You know the joke about economists, put 3 of them in a room, ask 1 question, get 10 correct answers. Well with lifecycle analysts, those same 3 people give you 547 correct answers, not 10. Because those three items, especially number 3, tend to have lots of shades of legitimate gray.

That's why rigorous lifecycle analysts generally shy away from using LCA techniques to compare 2 products or processes, as opposed to using them to assess trends in a single product. Because two products, both with perfectly reasonable assumptions as to what should be counted, often mean a "right" answer for one is not equivalent to a "right" answer for another. In fact, you know you have an idiot for a lifecycle analyst, if he or she tells you his or her answer is right, and product A is better than product B.

A simplistic example, let's say you have a plant in Thailand, that ships 1 mm cotton shirts a year to several vendors, including Walmart, and uses 1 mm kwh of energy a year. Should the energy allocation be then 1 kwh/shirt? What if 20% of those shirts are extra large? Should the XLs get a higher allocation because they're bigger? Do you make that allocation based on size, %, square footage, time to manufacture, or cost, or a combination? Even financial inventory accounting leaves room for differences. What if some shirts cost less than others to produce, should cost be included as a variable in the allocation, and if so, should average, LIFO, or FIFO be used? What if only 30% of the shirts go Walmart, and the others go to a place that doesn't have ecolabels? How do we account for shifting allocations over time if products in one batch come up with different labels, or get shipped by different ships? What if one ship is 20% full and the other 100% full? And how do you allocate the energy footprint for product returns, shrinkage, or wastage? What periodicity do you pick? Allocate quarterly, monthly, annually? Not every answer is material, and not every answer is difficult in every case. That's the whole point, it varies. All of these can have legitimately different answers depending on the nature of the business (and if we get comments on this article explaining the "right" answer, that will just highlight the point), and when you consider that multiple companies or plants supply components, and therefore part of the answer to each other to calculate the final footprint, the permutations of "right" blow out fast.Continue

Wal-Mart has been rather impressive on the sustainability front the past few years. If they can increase the sustainability of its supply chain it will have a massive impact across the world.

Now only wish they could Wal-Martize the health industry. Bringing massive cost reductions to a screwed up industry.

This is how it's done my friends....


More info here.

Daring to Dream...

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Picture 1.png What would be wonderful, delightfully wonderful, is if Honda really stuck it to the fat, slovenly (American) firms that can't stay alive without the teat in this video. Sadly, that's probably not what this is about...but I'll keep hoping.

Profit...and loss. That second part might be the most important. On a somewhat related note, check out the the latest EconTalk podcast, which is about Wal-Mart. The next time someone tells you that WM "exploits their workers" or is somehow bad for "the poor," especially if those poor "don't know any better," tell them to stick their arrogant noses---ahem.

These are amazing statements. To think of a market that is actually asking for responsible restraint and trading what used to be superfluous consumption into meaningful consumption...consuming with purpose, not as an end in and of itself.

As Christians, we need to infuse these trends with a new quest for Truth, and to teach again the value and dignity of the human person who should be at the focus of any and all marketing efforts.

I encourage you all to read the Pontifical Council for Social Communications "Ethics in Advertising" document here.

Ya' don't say?!

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Gm "hopes" to make profit in 2011.

As do I (hope that I make a profit, that is). Any reasonable person could care less if GM makes another cent (and would likely prefer them to fail)...ummm...unless you hitched your horse to their carriage (sorry, mate)...but, then, I have to ask: why haven't you indexed? Here's the creator of the index fund on...well...index funds. This stuff isn't rocket surgery. Wanna listen to a dude who's prescience gains him some credibility? Check out Taleb in Black Swan or Fooled by Randomness. Note: podcasts w/ Taleb also available on econtalk.


HAHAHAHAHAHA...."A slump in sales forced GM to file for bankruptcy protection this week."
Subtext: "...and when we say 'slump,' we mean, 'damn, this has been like a drunk monkey taking the bar exam.'"

Say it with me, folks: Debacle. It really is atrocious that the BBC didn't say anything about the obvious tomfoolery and mismanagement that has been part and parcel of GM for...oh....years, nor the governmental coddling that allowed this sort of atrocity.

Fragile Systems

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The bankruptcy of GM brings up the problem why do we allow human institutes to survive for so long when they should have been dealt with earlier? Nassim Taleb pointed out in either this talk or this one, that if you look at nature it allows fragile systems to fail early and often. Nature has no interest in building up fragile systems, yet humans cannot help but build fragile systems. Anthony pointed out that the big three should have been dealt with 20 years ago if not more. Instead we feed resources to a system that should not have existed. Detroit once one of the great US cities has been dying a slow painful death. Now when GM final goes bankrupt it dumps hundreds of thousands of people into the job hunting market when they least can afford it. You leave a once great city Detroit a third world city. I have been to Detroit and most of it is no better then any industrialized third world city. The rich live in their protected communities as the poor and working class are stuck in a living hell.

I am advocating that we move to follow nature's model and allow fragile systems to fail early. As complexity increase due to globalization we must have a system that is easy to fix, not one that "never" fails. No system never fails. Ones that are stable for long periods of time tend to lean towards cascading failures that wreak havoc on the system. Sometimes these failures lead to utterly new systems not in the long term interest of man and earth. Nature hates fragile systems, it does everything in its power to kill them before they can become problems. We should do like wise.

As if GM weren't enough....

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NEW YORK (Reuters) - Jen-Hsun Huang, chief executive officer of graphics chip maker Nvidia, called Intel's chip pricing unfair but said his company will not seek antitrust action against the world's largest chip maker for now.

Nvidia makes graphics chips that pair with Intel's low-powered Atom in lower-priced netbook computers. He said Intel sells an Atom chip by itself for $45, but sells a three-chip set for $25 to lure business away.

"That seems pretty unfair," he said. "We ought to be able to compete and serve that market."

Last week, the European Commission fined Intel $1.06 billion euros and ordered it to change its business practices for competing illegally against Advanced Micro Devices.

Intel brushed off Huang's suggestion.

"We compete fairly. We do not force bundles on any computer makers and customers can purchase Atom individually or as part of the bundle," said Bill Calder, a spokesman for Intel. "If you want to purchase the chip set, obviously there is better pricing."

For now, Huang plans no legal action.

"I hope it doesn't come down to that," he said, adding: "We have to do whatever we have to do when the time comes. We really hope this company (Intel) will compete on a fair basis."

Article here.

Get the man a tissue so he can wipe his eyes after his nose is out of the government's...well...nevermind.

This is why fans of capitalism are very often wisely not fans of capitalists, especially after they can get the government to back them up. As Sowell has mentioned, you can't find a positive reference to businessmen in Smith's Wealth of Nations(I believe he referred to them typically as 'industrialists,' and I'd like someone to find/remind me of the quote reading something like: 'every time businessmen get together to meet, the victim is the consumer'). Sowell, incidentally, would give an 'A' to any student who could find such a reference. If intel is selling stuff for "unfairly low" prices, that's GOOD for consumers. If nvidia can't sell at that price...guess what; innovate or go the hell away, don't whine to get the justice system to prop up your shitty business skills by hobbling your competitor.

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General Motors followed Chrysler into bankruptcy on Monday in a case that will be one of the largest and most complex in history. Here is a quick look at some basics of the G.M. bankruptcy and how it may affect owners of G.M. vehicles and company stock. The questions were answered by Micheline Maynard, who writes about the auto industry; Ron Lieber, the Your Money columnist; and Tara Siegel Bernard, a personal-finance reporter. Get the rest here in the New York Times.

GM and Chrysler should have re-organized and consolidated assets at least 20 years ago but they were allowed to continue to be poorly run companies because some Americans believe in government financial support of big business.

I don't get it. It's not the government's job to enable bad business models to continue to put employees at risk and defraud investors with a false picture of the company's health. With the corrupt relationship between politicians and the auto-industry over the past 30 years, we now arrive at a situation where thousands of employees and former employees are at huge risk of having not having retirement monies.

The GM and Chrysler debacle are good examples of what happens when you mix government intervention in business, it enables sloth, irresponsibility, and greed and now tax payers and former employees are bearing the costs of corruption, mismanagement, and dysfunctional corporate enabling by politicians. The odd part is that people what more of this? Que???

The System is Down, the System is Down

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People do not think clearly on the systemic level.

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From Matt Perman, explaining Andy Stanley's DVD set "Systems":

...systems trump intentions and mission statements.

Here's what that means. You might have a great mission statement, but systems are what create behaviors. So if your systems are out of sync with your mission, then your results will be off-mission too.

This will be true in spite of the best of intentions. Even if everybody in the organization wants "change," the change will not happen if the systems are set up in a way that produces and rewards the opposite behavior.

Man, this insight explains so much. It's not just business organizations, but also churches and governments. If we include groups of people with implied mission statements, then this applies to families, cultures, etc. Keynesian economics, currently favored by our leaders, is a great example of a foolish system, but so is Monetarism.

Things like racism and poverty are systemic dysfunctions as well as personal problems. Sin works on both individuals and systems, so shouldn't the Church do the same? Have you been in an organization with nice leaders but a horrible system?

Let GM go under

| 17 Comments

From CNN: Jack R. Nerad is Executive Editorial Director for Kelley Blue Book, says don't let GM go bankrupt over at CNN.

(CNN) -- The events of the past week have been unprecedented in the auto industry and in the annals of American business.

As the events have unfolded, there is the strong implication from the administration's automotive task force that Chapter 11 bankruptcy, followed by restructuring and "cleansing" of General Motors' balance sheet, is a potential scenario in the ongoing efforts to keep the giant automaker alive.

GM's new chief executive, Fritz Henderson, acknowledged as much on CNN Sunday. "You can't rule options off the table. So you basically say we will spend time to try to get it [done] outside of bankruptcy. But if we can't, we're not going to compromise our goals. We're going to get it done inside our bankruptcy. Our preferred approach is still to do it outside, but you can't rule out going in."

Over the past few weeks pundits of all stripes have appeared on financial news networks suggesting that entering Chapter 11 is GM's only way to future viability. "Get on with it," they say, and save us the agony.

It is the only way, they argue, General Motors can get relief from its immediate cash-flow issues, tear up or substantially modify its union contracts, dump unnecessary brands, close plants and "right-size" its operations. But those pundits who propose Chapter 11 fail to acknowledge that General Motors is a consumer-facing company whose success or failure is in the hands of millions of average Americans.

NO, NO let GM go bankrupt like the rest of the companies that produce things that people do not want. GM's been a poorly run company for the past 30 years because government enables them to be inefficient and produce cars that people don't want. Quit bailing them out and let them be bought by a company who makes quality cares that people want.

The result of this election now leaves only Mexico and Colombia in all of America (the entire continent from Canada to Tierra del Fuego in Argentina) as right-wing type governments.

On Monday, the FMLN's victory over the traditional right winged party ARENA in El Salvador caused major shockwaves across Central America. Ever since the signing of the Peace Agreements in El Salvador, the FMLN (former guerrillas) established themselves as a political party but had little success until this year when they finally won the presidency. Many analysts say that this was possible because they chose as their candidate an outsider, a former CNN journalist, Mauricio Funes, that had not been part of the FMLN or any of their armed efforts to take power.

Traditionally, El Salvador has been a very strong ally of the US and one of the most (if not the most) open economies in Central America with a very dynamic business sector and the most modern and efficient banking system in the region. Let's wait and see what happens.

Invitacion.jpgThis was a busy week for Christians in Guatemala. Under the umbrella of Luis Palau's Family Festival a whole host of great activities for Christians of all interests was organized.
One activity in particular was of interest to me because some of my professors and friends from my graduate school, Regent University, came on behalf of Regent's Center for Entrepreneurship to give a conference on Business as a Mission (under the Kingdom Business Paradigm).
A lot of the talks focus on the already popular and I believe, cliche'd idea of "leadership". What does leadership mean anyway? As Christians....are we called to be leaders....or servants? What is servant leadership? How does this contrast with the idea of stewardship?

10 years after I wrote my thesis on "Stewardship and Transcendence: Two Key Biblical Principles of Economics" to obtain my B.A. in Economics from Francisco Marroquin University in Guatemala, a reporter from El Periodico, came across it as part of her research in an article published last Sunday about a small rural, indigenous town in the Northwest of Guatemala called Almolonga. (You can download my complete Thesis in English here -please bear with my mistakes in grammar and style while reading it: Thesis English.doc) I had the privilege of being interviewed for this article.

Almolonga is famous for its amazing transformation from an extremely poor rural town, to a bustling commercial and agricultural center that has been infused for more than 35 years with the envigorated preaching of God's Word. The town is now more than 90% Christian, there is no jail, only one cop works in the town and most of the old "cantinas" are now mom & pop grocery stores. The town that now worships Christ, used to worship Maximon, a mayan-catholic deity/saint who required offerings of tobacco and booze in order to bless his devout followers. More on Almolonga here and here.


If we are truly to become accomplices as communicators with those who read our posts and listen to us speak in the building of His Kingdom, it is about time we consider some new ideas of what it means to truly communicate, engage and mobilize.

I have been reading the book: "La Comunicacion Municipal, Complice con los Ciudadanos" (Municipal Communication, an Accomplice with Citizens) by Toni Puig, Communications Director for the city of Barcelona, Spain. (Not sure if the book is out in English yet, a good practice for all Spanish students).

I would like to share some insights from the book.

"For Frederic, communication, advertising in its terminology, currently consists in prioritizing unreachable desires for constant insatisfaction."

"For the first time in history, human beings from every nation have the same goal: make enough money to look like an ad." (Frederig Beigbeder, 13.99 Euros)

"In our current communication there are no, unfortunately, rules. Communication arises from the will to live, to add, to share, from big causes, from commitment, from difference, from adventure, from determination, from singularity, from feelings, civic values, from love for citizens and the city, from our own experience and our shared experiences, from talent, from personal work and from teamwork."

Things to ponder as we grow as communicators.

Back to Basics with Vishal Mangalwadi

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This is my guy:

propaganda_quiet.jpgshut-up.jpg

When I saw these old WWII posters (I understand that the historical context is completely different) and compared what is going on in Latin America with the new Bolivian constitution, Chavez going on for indefinite re-elections and our president flying to Cuba to bestow Guatemala's greatest honor, the Order of the Quetzal medal, to Fidel Castro and seeing at the same time what's happening in the US with this whole stimulus package frenzy, I cannot help but wonder if we are not on the brink of falling to these extremes again.

In Guatemala we have a saying: "El que calla, otorga" ("He who remains quiet, concedes"). Why aren't we taking the streets and denouncing all these outrageous policies, acts of corruption and impunity? I have a theory.....

As a part of the Obama-revolution The Institute is adding a few more voices to the mix. We welcome two writers, Tom Kim and Abraham Sangha, to the voice of "protest and invest" because I believe that red, yellow, and brown people are more than just ornaments on the evangelical's "we're not mono-cultural" mythological Christmas tree and should have a platform and a voice beyond the margins.

Most people in evangelicalism can't name any Latino or Asian voices that they read or follow on a regular basis. One of the most profound blessings I've encountered over the years has been learning from Koreans and mis amigos from the Latino Leadership Circle.

I can't even name a Native American theologian/preacher/etc. So why do we not request the voices of Latinos and Asians? Not sure, but I do know that the "racial reconciliation" blah, blah is more rhetorical and is still Anglo-centered. Just because some bohemian-types wear African clothes and throw in a Hispanic praise song it can still be paternalistic and patriarchal. Trust me, I've been there.

Becoming a Christian should not be synonymous with becoming Celtic or Eurocentric. I've noticed that many evangelicals who are into "the arts" do not promote African, Latino, nor Asian expressions. Why is that?

Dr. Clearance Shuler, thankfully is more creative than "reconciliation blah, blah" and promotes something better, "Biblical Diversity." Shuler focuses on the fact that "African Americans, Asians, Euros, and Latinos think differently." The dominant culture doesn't get that some argue.

So, we welcome new brown and yellow voices to the mix here. Stay tuned. . .

Tom Kim_opt.jpgTom (far right) works as Financial Analyst for a scrap metal recycling company in the Bay Area of Northern California.

Thumbnail image for abraham_opt-1.jpgAbraham, a former civil engineer, graduated from the University of Illinois and is currently completing a Master of Divinity degree while serving a church in the St. Louis area.

About this Archive

This page is an archive of recent entries in the Business category.

Debacle is the next category.

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