Archive for the 'money' Category

« Previous Entries

The Quality of Smallness

This isn't addressed to you. It's addressed to a group of people like you. Or rather, it's addressed to the unconscious style they are encased in, and chase.

On the morning cable financial news channel, the hosts go on endlessly about how there's a change in consumer tastes. The reason that fast-food hamburger chains and soda pop companies are feeling a pain in their share price is that consumers are thinking “natural and organic.” Consumers are also starting to think about the supply chain. Where does this food come from? Under what regime of regulation and inspection was it produced? Did you say the fish I'm eating was imported from China?

It's a generational change, younger people weren't hooked by the “I'd like to buy the world a Coke” advertising blitz. They see fast food and soft drinks for what they are, and they have convenient alternatives. We should acknowledge that healthy alternatives have only recently achieved mass distribution. It's much easier to make this choice today. Or rather, it's easier to maintain the “fast-food mindset” and choose somewhat healthier foods.

The fast food companies are starting to abandon the use of antibiotics in the production of the chicken they serve. They're making other minor changes, as they chase the style that enchants the consumer these days. They're asking themselves how little the industrial food complex can change to take advantage of some of that “natural and organic” glow. What will take to get some of that appearance to rub off?

While there are a myriad of problems with the way the news media, companies and the regulators think about “natural and organic,” it's still a positive change of direction. More hopeful is that this change was initiated by consumers, not by companies. A change in consumer style is wrecking havoc on the business plans of the soft drink and casual/fast dining industries. It's a rare thing, so it's worth taking note.

I don't want to jinx it, but I'd like to make a request to that amorphous cloud of desire out there, that “style we chase.” I'd like you (I'm talking to you, amorphous cloud) to start associating “smaller” with better quality and more concentration. This would include things ranging from apples to onions, boneless skinless chicken breasts to movie theater popcorn sizes, McMansion houses to pizzas.

There's a natural large size that occurs rarely in the course of things. We should be surprised by this kind of largeness. Well, would you look at that. Look how big that thing is. Don't see that too often. Instead, large, extra-large and jumbo are the “normal” sizes. The way we produce this standard large size is by diluting and inflating whatever it is. While it appears to be more, it's actually less. It's vast quantities of weak tea.

So, here's the deal. Occasionally something changes in the way we perceive things. Suddenly we can plainly see that the product we're buying is pumped up with some diluting agent to make it look bigger. What was previously an attractive quality–bigger, no matter how it is achieved, is now a little repulsive.

The ultimate performance of taste is identifying the things you want to spit out. I want to make the case to your unconscious sense of style that “fake bigness” that attempts to appeal to your impulse toward gluttony, should be eschewed. Suddenly you have the sense that certain things are grotesquely big.

That is all.

 

The Unit of Content Consumed

We've yet to come to terms with how musicians are paid, on a per stream basis, by the big streaming platforms. Suddenly news comes from Amazon that they are set to pay self-published authors as little as $0.006 per page read. Longer books may receive a slightly higher payment rate.

If one had the goal of stopping writers from writing for e-book publication, or stopping musicians from creating music for the recorded music format, this would be a good strategy. It's hard to imagine another industry that would tolerate this kind of economic contract. If I only eat half of my meal in a restaurant, I expect to pay half price. If I drive my car less than other drivers, I should pay a lower price. If I buy something from Amazon and grow bored with it after a week, I shouldn't have to pay full freight.

Following in the steps of the band Vulfpeck and their album “Sleepify.” I shall self-publish an Amazon e-book with only twelve blank pages. “Sleepify” consisted of ten 30 second tracks of silence. The band encouraged its fans to play the album on a loop while they slept. Funds raised through this method were used to finance a free concert tour by the band. Spotify owed the band $20,000 in royalty payments and eventually paid up. They then pulled the album citing violations of various policies.

Readers, set your library of self-published e-books to auto-advance and loop. After all I have machines that read all my books for me these days. All I need to know is whether I liked it or not, and a few bon mot for cocktail party conversation.

This is what passes for innovation these days.

 

Only the Rich Can Save Us

The Sunday paper brings two related stories. Last year San Francisco was number one — it had the fastest-growing rate of income inequality of any city in the country. Now this year, it turns out that San Francisco's rich people are far richer than any other city's rich. Go us.

The other story is about a retired venture capitalist leasing a large industrial building in the Dogpatch district to create below market rate spaces for art galleries. San Francisco's art galleries are being priced out of the market, and once they're gone it will be almost impossible to bring them back. According to the article:

Andy and Deborah Rappaport, who have never been in the arts business, plan to invest “tens of millions of dollars” in a cluster of buildings that will include studios and other arts amenities under the umbrella of the Minnesota Street Project.

This for-profit business venture aims to lose as little as possible or at best break even. They have a 15-year lease and are offering galleries 3-year leases at below market rates.

One of the moral failings of the techno-rich, in the city with the richest of the rich, is that they've operated as though the city and the world around them has no relationship to them. They take no interest in the diversity of the city, the schools, the parks, no interest in the arts or culture, no interest local politics (except when it comes to tax breaks). It's possible that a few of these rich folks have looked up from their piles of cash and seen the city changing radically around them. The Minnesota Street Project was inspired by a conversation the Rappaports had with veteran gallerist Catherine Clark. Again, according to the article:

“We were talking about how we didn't want to live in a city that didn't have a vibrant arts community,” Deborah says. “There have to be galleries, and there have to be artists' non-profits, and artists have to be able to afford studios.”

Frankly, the real estate market doesn't care what kind of city you, or anybody else, wants to live in. The “market” gives the non-rich the option to move somewhere else, its invisible hand will determine what kind of city you will live in. If the market decides that art galleries, artists, non-profit workers, teachers, nurses, day-care workers and librarians are under-resourced to live in San Francisco, then they'll have to find somewhere else to put down stakes.

The non-profit achive.org has been studying the unaffordability problem and come up with its own solution to help its workers. According to their blog:

The Internet Archive and the Kahle/Austin Foundation are trying a new model to help. Foundation Housing as a name for a new housing class : Permanently Affordable housing for non-profit workers.

In this model, a new nonprofit, the Kahle/Austin Foundation House, has been set up to purchase apartment buildings. These rental units are then made available to employees of select nonprofits at a “debt free” rate– basically equivalent to the condominium fee and taxes. Typically, the debt makes up about 2/3 of the cost of a building and the other costs (tax+maintenance+insurance) makes up about 1/3. Since the employee does not pay the debt part, the monthly fee is now about $850-1000/month rather than $2700-3000 current market rent. This way, the fee to those employees is about 1/3 of the cost of market rent, and we believe more stable than market based rents.

In the face of ever expanding income inequality, these are the only solutions that seem to have a chance. Real estate is simply moved out of the real estate market to create affordability. If this kind of a proposal came from a community organizer it would be shot down as unrealistic — a socialist redistribution of wealth from the rich to the undeserving poor. And heaven help the elected official suggesting this kind of scheme. They'd be run out of town on a rail.

Tim Cook, the CEO of Apple, Inc., recently joined the ranks of the super rich who have pledged to give away most of their fortune. Warren Buffett and Bill Gates are two other notable members of that clan. Technology money rarely supports the arts. It's more disposed towards funding medical advances. The possibility of immortality is a primary fantasy of the techno-elite. While often quite smart, most of them have the cultural outlook of an adolescent boy. Some believe that Bill Gates will outshine Steve Jobs when we look back at these years because of his post-Microsoft charitable work. For most of the rich, helping the poor is simply beyond their control — the market will do what it will.

To address the issue of income inequality, wealth will have to be redistributed. The gap has grown so wide there's no other way to bridge it. Despite the fact that the poor are in the majority, they seem have no voice in the matter. For the moment it's up the the wealthy to do things like the Minnesota Street Project. archive.org needs to do what it can for its employees and other non-profit workers. Perhaps another retired venture capitalist can address the other half of the problem for artists. While they welcome below market rate studios and gallery space, artists still need a place to live.

New York City Mayor Bill de Blasio has proposed building 1,500 affordable housing units for artists and creatives at a cost of more than $30 million. This action came after musicians David Byrne and Patti Smith commented that New York was no longer a good place for young artists. The same could be said about San Francisco.

Great wealth confers the gift of being able to interfere with market dynamics without being called a socialist. The invisible hand can be shoved aside, and other priorities can be manifested. The Minnesota Street Project will bear watching. Let's hope they make a go of it. And here's hoping the peers of Andy and Deborah Rappaport are paying close attention. They're the only players in this game that are allowed to make a move.

 

Let Our Robots Fill Out Your Forms…

Bankers are making use of new technology to determine whether you’re creditworthy. According to the NY Times:

“…they may look to see if potential customers use only capital letters when filling out forms, or at the amount of time they spend online reading terms and conditions–and not so much at credit history.”

They say that “no single signal is definitive, but each is a piece in a mosaic, a predictive picture, compiled by collecting an array of information from diverse sources.”

Fortunately for you, our new firm, HONESTLY, has a whole cloud full of robots standing by to fill out your loan forms for you.

HONESTLY has hacked into all the major banks and new technology providers. When our robots fill out your forms for you, you’ll hit all the right notes for their algorithms. This kind of service has previously only been available to the very rich, but thanks to the marvels of modern cloud-based technology, we can offer robot-driven loan application filling for a low $9.95.

The banks and other loan providers have said that they’ll continually change their matrix of criteria to create better risk assessments. Since we’ve hacked into their systems, have paid off their programmers, and created strong predictive profiles of their key executives, we can anticipate their every move. In fact, sometimes their new criteria comes directly from us, which saves us programming time. That’s a saving we pass on directly to you.

HONESTLY, I can’t think of a reason not to have robots fill out your next loan application.

 

« Previous Entries