Weakonomi¢s » business

Fast Forward Through The Commercials

The Weakonomist — Thu, 24 May 2012 14:16:45 +0000

These days a lot of people don’t like watching commercials. Many people record their favorite TV shows which makes it easy to fast forward through the commercials. Some can stream their favorite shows through the internet or on websites. A few even watch pirated versions. It’s not always about the pursuit of not watching ads, but by and large we’re watching fewer advertisements these days than we did 10 years ago.

And television execs aren’t too happy about this. The issue seems to have come to a boiling point with Dish Network announcing a new DVR that lets viewers skip commercials altogether. Folks like Fox and NBC are refusing to air the commercials for the device (the irony is palpable).

But I’m here to say you should keep fast forwarding through ads as much as you want. Avoid ads as much as you can.

Those of us that watch TV on Hulu have become painfully aware of how much ad time eats into a show these days anyway. An hour long show is really more like 42 minutes. The average prime time show has about 14 minutes of ads and 10 minutes of product placement. According to Wikipedia, back in the 1960s a typical hour long program was 51 minutes. It’s no wonder we’re sick of ads.

You just go right on ahead and skips over any ads you don’t want to see. If I were a marketing manager, I’d only want to reach interested customers anyway. So it’s the television execs that are really in a bind. They’ve got a way out but it requires more work than they’d like to put in.

The new era of advertising is much more targeted. Most of the ads you see on my site come from Google which has been analyzing your activity online to try and target relevant ads to you. When I go on my site I see ads for new running shoes. My dog would see Busy Bones and tennis balls.

Television studios have already embraced other forms of advertising like product placement. But the savvy ones are going much deeper. On American Idol two companies have found ways to imbed advertising within the stars of the show themselves. Every week Ford shoots a commercial that features their vehicles and the stars enjoying them while singing some kind of Kidz Bop version of a pop song. The show airs the commercial as if it’s a regular segment and viewers watch it because they want to see their favorite contestant. Likewise, the resident talent expert Jimmy Iovine pimps Beats By Dre (which he co-owns) everywhere in the show. It’s on his hats, the contestants use Beats mics to practice, and various Beats products are dropped into segments. They also air a Beats commercial with a former American Idol star.

These companies and the show know how to do ads in the 21st century. Some do not. GM just announced they will stop advertising through Facebook because it doesn’t work. Ford said they’re sticking with it and GM just isn’t doing it right. Sounds like GM and the traditional networks would get along.

So please keep skipping over ads. Block mine if you want too. If I can’t effectively reach an appropriate audience I deserve not to make money. Those big guys who can’t adapt will likely go down kicking and screaming trying to defend a 20th century business model. Let em die.

Further reading: What if TV networks embraced ad skipping?

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And Here I Thought It Would Be A Slow Offseason

The Weakonomist — Wed, 23 May 2012 14:04:36 +0000

College basketball is over, college and pro football are long gone. And while I have watched more NBA basketball this year than in prior years, falling asleep through one quarter doesn’t quite count. I don’t watch hockey and I hate baseball. So I thought the offseason would be boring.

That is until news broke that two of the biggest athletic conferences announced a partnership for some football games a few years from now. Non sports fans will read that and think it can’t be a big deal.

But it is. And that’s quite sad. The state of college sports has completely boiled down to money. That is all that matters. And the money is in football. If you’re a well known university and not in a major athletic conference, you could be missing out on tons of money. A lot of that money comes from selling the TV rights to games.

This new partnership sets in motion a cascade of potential events and outcomes that could ultimately demolish some conferences. Notably, my beloved ACC. I grew up in the south as a basketball fan, but in college I learned to appreciate the gridiron as well. The partnership could mean schools like Florida State might leave the ACC to be in a conference more aligned with football, which that school is. Florida State is in the ACC which is traditionally a basketball school. But the big money is in football and the ACC could get shut out of the high revenue games.

As a result, the sports media has gone ballistic this week. Of course such speculation about school movement is great for ratings and clicks. School administrators keep saying they will do what’s best for the school. But something about all this is really eating me up inside.

When did switching sports conferences become best for a university? People forget that these places are schools. With the recent conference switching we’ve seen many schools are now having to travel further and further to play games. And it’s not just football. Every other sport will have to do it too. Look at the map of the Big 12 conference. Does that make sense?

All the major conferences are heading in such a direction. How can that be good for students and fans to have to travel? How can that be good for the players who are supposedly students first? It’s not. It’s good for the pockets of institutions that are supposed to be non-profit.

But I understand why college sports want as much attention as possible. Some schools wouldn’t be known nationally without sports. However all these moves, all the power plays and changes smell of corporate mergers and acquisitions more than something that is merely a game where the players don’t get paid.

The ACC is bad enough. They’ll let in any star athlete they can recruit and academics don’t seem to matter. No where in scouting reports does anyone report on a high schooler like this: “he’s got the athletisicm to run the point guard position for Duke but he really needs to focus on his 12th grade chemistry”. It doesn’t matter. But at least the ACC schools as a whole tend to try to keep themselves to a relatively high standard. Half of all the ACC schools (7) are listed in the top 50 national universities by US News. The others are not far behind. If you look at the two conferences that struck a new relationship, they have 7% and 10% respectively. Which amounts to 1 school in each conference.

It’s clear academics just don’t play a role in the decision making in sports at all. It’s all about who can get the most money. And it seems the athletic departments now hold more power than any other group at a school. At this point it’s a pissing contest as the television revenues are already through the roof. The quality of education one gets at said school just doesn’t matter.

That bothers me more than football calling the shots for the other sports. And I understand that football is able to subsidize the other sports for most conferences. But what conference one is in should be secondary to all other things. TV rights should be tertiary, or non-existent.

The “business of college sports” shouldn’t return 1.2 billion results in a Google search. It’s great that college football is slowly moving to a system that brings about more tournament-like play, but now everyone is just making a grab for cash. One would hope amateur sports was about to enter a renaissance, but it’s looking more like the same “greed first, grades second” we’ve had for a couple of decades.

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When The Next Too Big To Fail, Fails

The Weakonomist — Thu, 17 May 2012 14:21:10 +0000

One of the issues with the financial crisis was a government that wasn’t sure what to do with failing companies. When a company failed they could either let it go into bankruptcy or bail it out. Some were allowed to fail, and that created a panic that the system would lock up. So most were bailed out to preserve the integrity of the financial system. Whether that was the right choice is a matter of debate, but that’s what happened.

Financial regulation in 2010 sought to make this process a little easier if there was a next time. Agencies were given new powers they’re now getting around to figuring out how to use them.

One of the most powerful agencies is the FDIC, which insures the deposits of banks. If a bank runs out of cash to pay depositors, the FDIC comes in with fresh cash and takes over the bank. Their new system is a bit of corporate trickery, but I’m pretty sure you can keep up.

Most banks operate as holding companies. So a corporate entity owns a collective of businesses that look like one company to the customer. It’s the corporate entity the FDIC will take over. The individual businesses that aren’t broken will be allowed to continue to operate. This keeps the financial system intact. If those businesses need money, the FDIC is allowed to borrow funds from the Treasury.

Stockholders in the parent company will be given nothing. As per corporate law anyway, they should lose their money. Anyone that lent the bank money will exchange the debt for equity (ownership) in a new private company. Presumably, the new private company will include the functioning businesses, the sick businesses will be bankrupted.

This sounds relatively easy on paper, but in practice it could be a nightmare. In fact, some don’t think the FDIC could pull it off. Many expect it would be too hard and they’d just do another bailout. In the old style bailout the government will just lend the company the money directly and help them work through the issues. Stockholders will get hurt, but they may not be wiped out.

It is very complicated though. Stockholders in the failing company may fail themselves if the value of their stock goes to zero. A panic may still occur. But the goal of the new process is to keep the functional units functioning, therefore preserving the banking system. While the plan might not work, it’s better than not having a plan in place at all.

What regulators will have to keep in mind is that nothing ever goes to plan. The unexpected will occur and so they must be prepared to be flexible and adaptable. Hopefully, we’ll never need it.

Read: Avoiding the Next Big Bailout

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Six Things The Bachelorette Can Teach Us About Money

The Weakonomist — Tue, 15 May 2012 14:15:27 +0000

Being married to the fairer sex, one often finds themselves watching television shows that don’t normally show up on their radar in order to spend quality time with said partner. Funny, as when Star Wars comes on I find myself quickly alone in the room. Marriage is about sacrifices though and so last night I sat through 90 minutes of what I can only imagine the CIA refers to as water-boarding.

But that doesn’t mean I can’t exploit my discomfort to find some pop-culture references that can be tied into something for this blog. Usually, I prefer to do these lists with things I actually like (see below), but I can make an exception.

So what can a reality show that by its very nature defies the statistics behind matchmaking teach us about money? Just see:

If something is profitable, make more: And it doesn’t have to be good, it just has to make money. This is really what The Bachelor and The Bachelorette have always been about. Television and movie producers will happily take concept and run it into the ground. Not only have the original shows had many seasons, but offshoots of the concept like Joe Schmo, Joe Millionaire, and Flavor of Love and more have also had varying degrees of success. It doesn’t have to be good, it doesn’t even have to be a success based on the fake premise of one person finding love among dozens of members of the opposite sex. It just needs to be entertaining. This model isn’t limited to TV. We see this in toys, video games, and just about any form of entertainment because product and content executives really have no idea what will work until it’s in front of the people.

Nothing is safe, there are no guarantees: On The Bachelorette one beautiful woman is given 25 guys that will try to court her. Through a long and drawn out process of elimination she will get the group down to just one and then that one must choose to be with her or not. Many times the show ends with the two engaged or at least caught up in a fairy-tale style romance. The reality is that the couples don’t normally last. This is easily evidenced by the fact the current bachelorette won on the last bachelor and then they broke up. The same thing of course applies to our finances. No investment is perfectly safe. Any investment, even the cash in your bank account could go away. Most people assume their money is always safe because that’s how it’s pitched by bankers and investment advisors. Investments and cash are much safer than a relationship formed on a reality show, but by its very nature money is never safe. Even under your mattress.

There’s always enough idiots to fall for a scam: The financial crisis exposed Bernie Madoff’s ponzi scheme and since then government agencies have cracked down on dozens of other investment scams. But there will always be enough morons to fall for the next one. Just like there will always be enough potato-brained viewers to buy into the premise of The Bachelorette. Keep in mind, the premise is that 25 guys would all magically like the same girl and compete for her love. The only place that’s reality is China. But like an investment scam, to get viewers the show sells the idea that something that is too good to be true is actually true.

Stick with the boring options: Advisors and bankers commonly convince their clients to put their money in products they don’t understand. But they look interesting and have all the bells and whistles. On the show the best person for the man or woman is likely the most boring contestant. The one that doesn’t cause trouble and stays out of the way of the other suitors. The one that doesn’t do cheesy things to get attention of viewers or the opposite sex they’re courting. But those people aren’t entertaining, and don’t last long on the show. It was clear in the premier who the producers of the show like, and they will somehow last much longer than the view would expect because they’re fun to watch. Stick with boring investments that are easy to understand, they’re the only ones that will still be around when you’re old and grey.

Past performance is not an indication of future returns: We see this all the time on the documentation you receive about mutual funds. They must disclose this in the marketing materials because those materials contain nothing but carefully framed charts showing their past performance. It’s good they must disclose this. On The Bachelor this is not disclosed, but it is implied in the premise. The show’s track record for successful relationships is actually terrible. The simple fact that they bring back someone that was matched in a prior season is enough. This year the beauty has a kid too. I’m sure that kind of baggage will certainly get the guy to stick around after he wins.

People will do what their incentives tell them to do: On the show, every person has an incentive to win. Winning gets you celebrity status for at least a short time. If you can “win” you can parlay that into a career in Hollywood regardless of your relationship status. The winning couple can make quite a bit of money in endorsements and other celebrity related goodies. So is this really about love? Love of money perhaps. Pretending to love a pretty girl long enough to get there is a small price to pay. This is exactly the same problem we have everywhere in the world: politics, business, school, sports. People have various incentives and they may not be perfectly aligned with the intent of their position. This is why we are constantly disappointed but really shouldn’t be surprised when these people do something bad that lines their pockets.

There is much to learn in the world of television. Look all around you and try to learn lessons from other peoples mistakes.

Other “Six Things Can Teach Us About Money” Posts:
Star Wars
The Ferengi
James Bond
World Cup
March Madness

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Movieconomics

The Weakonomist — Tue, 08 May 2012 14:15:40 +0000

The film industry never gets much attention. They make movies and you either go and watch them or don’t. You read reviews to maybe help decide what to see or maybe ask some friends if anything is good. Those with children probably go see whatever it is the kid wants. But for the most part, we don’t know how the industry works, or what’s changed for them lately.

Movies are essentially investments for production companies. They have a cost to purchase and there is an expected return on the investment. Purchase costs can be difficult to predict though. The cost to produce a film may run over your budget. The payoff can be risky too. Depending on what type of company you are, you might produce the film and sell the rights to distribute to another company. Or if you’re one of the larger companies you might produce yourself and distribute. Distribution is a huge cost, as it often include the marketing of the film as well.

Theaters basically purchase the film wholesale and sell it to viewers at a retail price. Unfortunately for the theaters, they don’t make much money on the film itself. They make their profits on concession items and nowadays selling advertising to play before the show starts.

But movie ticket sales have been on a downward trend for years. The recession slowed this trend as people likely gave up more expensive outings for a family trip to the movies, but sales are still falling. The cost to produce blockbuster films have gone up though. This has started to squeeze profit margins and the poor showing of John Carter illustrates this well. This has led to the studios taking on considerably less risk than they would have in prior years. Much like banking, they aren’t just going to throw good money after bad anymore.

So the industry is taking a page from banking and making smarter investments. They’re also building a pipeline of movies that play off each other. A series of well-produced sequels are much more likely to be successful the a collection of unrelated movies with each having its own risk. The pipeline can easily be dumped too if the first film doesn’t work out.

This is very obvious in The Avengers, which just came out last week and is already breaking box office records. They’re costs were similar to John Carter but the return on investment will be triple. This is because they’ve been building up to this movie for years. One of the heroes in the movie is Iron Man, and they’ve been teasing an Avengers movie in the Iron Man films since the first one came out in 2008. There have been Captain America and Thor movies as well since then, each building up a character that is in the Avengers. This makes for a franchise that is sure to be very profitable since each plays off the previous.

What does all this mean for the customer though? Falling ticket sales forces the movie makers to be smarter. The collective pie is smaller so if you want the biggest chunk you have to go after films more likely to be successful. This means a lot less crap in the movies. The quality of films that make it to the theater is likely to be much higher.

But don’t expect movies to get any cheaper. For some reason all movies cost the same price. What would it look like if popular movies like The Avengers cost more at the theater?

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Three New Ways To Pay For College

The Weakonomist — Mon, 07 May 2012 14:09:42 +0000

Somehow, our elected officials in Washington have managed to agree on the issue of student loan interest rates. It’s a cause for celebration. Federal student loan rates are set to double soon if new legislation doesn’t get signed. Everyone agrees, and yet they’ve still made it political.

In Washington the only currency is political capital. It benefits a politician’s career more to get in the way of legislation than it does to actually work towards getting something passed. I’m not a huge fan of student loans, and only consider them a last resort option. Nowadays they’re the only option for many. That’s because schools continue to jack up tuition and they don’t bear any the risk if their students can’t afford to pay back those loans.

Perhaps they should be responsible in some way for students being able to pay their bills. Colleges don’t have to compete on price because each one offers such a different experience. They’re able to charge what they want because the people borrowing the money aren’t thinking about a return on the investment. Economists might see this as a broken market. I agree. So here a few ways to pay for college that could help balance this out a bit more:

Equity Stakes: This is a brilliant idea that encourages entrepreneurship. Clarkson University is holding competitions among potential students to pitch business ideas. The best ideas get full rides to the school and in return Clarkson gets a 10% stake in the company. If Harvard had done this with students like Mark Zuckerberg and Bill Gates they’d have an endowment so big half their students could go to school for free. This is a bit risky, but it’s a great way to align incentives. Everyone wants these kids to succeed. And universities have the resources to incubate ideas.

School Financed: If schools think their product (education) is so valuable, perhaps they’re willing to provide the loans for you. Given the appropriate interest rate they could recover a few losses and even make a profit. You’ve seen this with vehicles; GM and Honda both have/had in house financial services companies that provide the lending for their products. The parent company bears the risk. There’s no reason a school couldn’t do this too.

Income Based: Like the equity stakes, this option forces the school to make sure their students are successful. Instead of taking a stake in a company, you get a cut of that student’s future income. Maybe it’s 5% of pre-tax income for 20 years, or 10% for 10 years. The student could be given options just like they have for student loans. The school would do everything to get the student into a good paying job. Perhaps alums could cut their obligation short by hiring new grads from their school too.

Every one of these options puts some of the risk on the school itself. Right now they don’t have any risk. Successful schools will thrive in this environment. Crappy ones won’t. There’s no reason why the school shouldn’t have skin in the game. And there’s really no reason for the government to have so much in it either.

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How An Economist Views My Parking Situation

The Weakonomist — Wed, 02 May 2012 14:19:46 +0000

On many days I am forced to drive to a location that is a number of miles in order to do work. It’s called commuting. Since I live near a large city and must drive into town I am forced to pay for parking when I arrive. Most people that drive in daily pay a monthly fee, but I do not drive frequently enough to this location to make it worth the cost to pay monthly.

For my parking needs, I have two choices. There is a surface lot available for $4 and a parking deck for $5. Each comes with it’s own advantages:

Surface lot: It is easy to get in and out of and I don’t have to get in by a certain time to get the $4 price point. But the lot is exposed to the elements both sun and rain. When it’s storming or really hot out, either I’m getting wet or my car is getting hot.

Parking deck: It takes longer to get in and out of, but the walk is shorter to my office. There is protection from the elements, not just for my car, but me as well. I can get to my building by walking through other ones. But I have to get in by a certain time to get the low price.

The parking deck is 25% more expensive, which can add up over time. Overall the utility of each choice is about equal for me so my choice depends on what I think the weather might be like that day and what time I get in. But the parking deck has another hidden feature, and this is where economists come in.

Event day
My office in town is near a number of buildings that host events, especially in the evenings. Events can be lucrative for parking facilities and they often switch to a flat rate for the events. This particular deck switches from automated payment upon exit to human power collection upon entrance when these events occur. Event attendees aren’t given tickets for exiting so the manager must leave the gate open for everyone trying to leave.

What this means for me is on these event days every once in a while I can drive out of the parking deck without having to pay, saving $5.

So when I know there is an event and choose the parking deck over the surface lot, I’m taking a risk and if I lose I’m out $1. That’s because my choices are to either pay $4, or maybe pay $5 with a chance of paying $0.

Options
Economists and financiers see this as an option contract. The contract is between myself and the parking deck operator. In finance, an option is usually a contract that gives the buyer the choice on whether to buy an asset from the seller at a set price in the future (some readers may note this is but one kind of option). The option buyer pays a small fee to the seller for the pleasure to decide in the future.

In the parking world the parking deck operator is buying a contract from me. They pay for the contract in the form of parking services, and they have the right, but are not required, to charge me $5 in the future.

Options are used all the time in the business world to give managers and investors a choice in the future they don’t want to make now. The deck operator wants to decide at the end of the day whether or not to charge me. Their ultimate decision will be based on whether or not they can get enough vehicles to come to the event to offset the loss on me.

As for me, I am taking a risk every day I park in this deck. The $4 surface lot is the more conservative choice. I know how much I will pay at any given time, and it will always be less than if I get charged in the parking deck. But if I tracked my visits into the city I could model the likelihood of the parking deck to charge me or not and allow an algorithm to decide for me. That isn’t going to happen, so instead I will be taking a risk. Wish me luck!

Image: o palsson

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What Are Your Chances on Match.com?

The Weakonomist — Tue, 01 May 2012 14:15:39 +0000

The online dating site Match.com throws around a lot of statistics in their advertising. They tout more dates, more relationships, and more marriages than any other site. They also say 1 in 5 relationships begin on an online dating site. In commercials it’s impossible to vet these claims, but we’re not in a commercial.

One in Five
Let’s start with the claim that 1 in 5 relationships now start in an online dating site. There are a couple of problems with such a claim. First of all, what constitutes an online dating site? Is Facebook and online dating site? Is something like Ashley Madison, a site for those just looking for affairs, a dating site? And no I will not be linking to Ashley Madison. Worse though, is how that information was obtained in the first place. Was it a research project from a university? Did the government commission a survey for some reason? This we do have the answer to.

The research was commissioned by Match.com themselves. You can read the very vague report here. Research paid for by a company that makes that company look good should always be taken with a grain of salt. First of all, the survey only included people that make more than $30k a year, and the population sample was about 2500 people. With no indication of statistical significance we can’t be certain these results are valid. Nor can we be assured they are representative of the population. When the government wants to survey the entire population, they go for 60,000+ people. That being said, this is where the claim comes from. Sadly, there have been no other surveys of “new” relationships so we can’t confirm or deny the stat. We can only look at surveys of all relationships which will give a lower number because it would include people like your parents who didn’t meet online.

Consider this claim a bit biased and not considered to be an approved number by statisticians.

More is Better
“More dates, more relationships, and more marriages than any other site”. That’s quite a claim. This number also seems to come from the survey they commissioned so I want talk about validity. Instead, let’s focus on what they are really saying. It’s all about more, more, more. Of all the dating sites out there, one has to have the most dates and marriages. Which one do you think would have it? The biggest one perhaps? That’s Match. Let’s look at the problem behind “more”.

I’ve got a store where 1 million people come in every day and 10,000 buy something.
You’ve got a store where 1000 people come in and 100 buy something.
I’ve got more customers, so I’m better? While only 1% of my customers buy something, 10% of your customers do. So while I’ve got MORE, you’ve got a better success rate.

Match makes no claim about having a better hit rate. They’ve got the most users so they are going to have more of everything. But your chances of getting a date aren’t better.

But let’s play with “more” some more. If you’re going to claim you have more of these things, let’s look at what we can be reasonably sure you also have more of:

More STDs: With the most users, Match.com has probably lead to more hookups which leads to more STDs.
More unwanted children: More hookups also means more slip-ups.
More breakups: More relationships also means more heartbreak.
More divorces: Taking the logic further.
More cheating: Again
More domestic violence: You think everyone on Match is stable?

Image: www.courtneycarmody.com

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Ten Reasons To Legalize Pot

The Weakonomist — Fri, 20 Apr 2012 15:25:21 +0000

Marijuana is probably the most misunderstood product readily available in the marketplace. Probably because despite being mostly illegal, it’s readily available in the marketplace. In honor of today, today being a day like any other day, here’s the argument for legalizing pot.

It costs too much to regulate – Billions are spent every year pursuing growers, dealers, importers, and everyone else involved in the trafficking of weed. It’s expensive to regulate, and that money could go elsewhere.

It can be taxed – All other controlled substances are already taxed. Some of the taxes are there to create a deterrence, but others are just there to create income for government. Estimates vary widely, but $6 billion in new tax revenue is achievable.

Legal weed is safer – It wouldn’t be too hard to find scientists that say weed is safer than high fructose corn syrup or aspartame. It’s certainly no worse that any other drug currently available over the counter or in liquor stores. The FDA could regulate the sale and distribution of weed and make it safer than it is today. Today you really don’t know what you’re smoking unless you grew it yourself. Like most eaters of food, smokers of weed are not likely to make their own. It’s use can be controlled by age limits and operation of heavy machinery just like other controlled substances.

Legal weed creates legitimate jobs – Marijuana is a multi-billion dollar industry and most everyone makes their money illegally. They are not recognized as a part of our economy. Yet tobacco workers are. Jobs would materialize overnight in a legal weed economy. Legitimate jobs also make for legitimate income tax.

Public support for weed is about to move in favor of it – It’s mostly older people that say it should be illegal. As that population continues to age general support for the legalization of marijuana rises. We’re at the cusp of a majority of people saying it should no longer be completely illegal.

Tobacco and alcohol are legal – This is kind of a weak argument, but it still applies. We regulate the use of tobacco and alcohol and still have a functional society. We all know that if these were illegal, the market for them would be just like marijuana is today.

Weed became illegal due to disinformation – Growers of hemp competed with growers of things like cotton. Cotton growers didn’t want to have to compete, so they launched a massive disinformation campaign that led to a misunderstanding of what marijuana really is. People were told marijuana leads to murder, insanity, and death.

It’s not a gateway drug – You know what is? Tobacco. Find me a meth-head, alcoholic, coke addict, or pill-popper that didn’t pick up a cigarette first and I’ll show you 5 that did. If pot were gone from the world, addictive personalities would find something else. Pot is readily available, that is why it’s the first illegal substance people try. That doesn’t make it the gateway.

There are legitimate medical benefits – That’s not an argument that you should be able to buy it for fun, but if a doctor thinks it will help a patient they should be able to prescribe it.

It might even make you skinny – Perhaps the munchies aren’t as strong as people thought. This isn’t an endorsement of weed as a diet drug. But there may be a lot more to this plant than people know today. Few have researched it since it’s illegal anyway.

This is a post continuing a conversation started from an original post back in 2009: Legalize And Tax Pot

Image: eggrole

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Three Really Dumb Ideas

The Weakonomist — Tue, 17 Apr 2012 14:03:42 +0000

Americans cut their own healthcare costs, and that’s a bad thing:
“Patients cut back on prescription drugs and doctor visits last year, a sign that many Americans are still struggling to pay for health care…” – NY Times

Stop right there. Is a reduction in prescriptions and doctor visits a bad thing? Healthcare spending is almost at crisis levels in the United States. And here you are telling me now that simply because we cut back that’s a sign people are struggling? It could mean that people are just tired of paying for drugs they may or may not need. Doctors are human, and therefore may make mistakes and prescribe stuff you don’t need. Worse, doctors are human, and some bad apples are willing to take kickbacks in order to fatten their wallet and prescribe you drugs you don’t need.

Cutting back on our healthcare spending doesn’t solve the problems of healthcare expenses, but to imply that a cutback means people are struggling to to pay for care implies two narrow views: One, that all care is good and worth it. Two, the cutbacks were only due to cost.

Bipartican policy is a good thing:
Just because everyone agrees it’s a good idea still doesn’t make it one. Obama’s painfully named Jumpstart Our Business Startups (JOBS) bill got through the House and Senate without much bickering. First of all, no one says “business startups”. That’s like saying “pizza pie”. It’s not wrong, but no one says is. But the bill is being picked apart left and right for essentially making it easier for scam artists to get money from morons. The best summary comes from Andrew Ross Sorkin. But who are we to judge who should invest in what? Stupid people can make mistakes and live and learn right? Well the entire investment industry is highly regulated to essentially protect the idiots. This takes some of that away.

But what’s even dumber is the portrayal of this bill as some kind of victory for Washington. Imagine Democrats and Republicans are two football teams who want to play but can’t agree on the rules, location, scoring, or even what kind of turf to play on. But this week they announced that whenever they have that figure out the team kicking off will be decided by a coin flip. Great victory. The only reason this thing passed was no large company or rich guy behind the scenes really cared enough to lobby against it. If you need further proof bipartisan policies aren’t necessarily a good thing: JOBS undoes some of the bureaucracy created by another bipartisan law: Sarbanes-Oxley. And the law passed in 1999 that allowed banks to become the huge things everyone hates now: bipartisan. (Interesting sidenote, the law that allowed banks to become behemoths was of course debated by our elected officials at the time. Why hasn’t this gotten more play? Granted, Congresspeeps make predictions all the time and occasionally get lucky, but still).

Apps in store:
Do you have one of those QR code scanners on your smartphone? Maybe you use the JCPenney app when you’re at the store to pull up cool deals or get product info. Or maybe like me you want to see if those towels you wife has been eying at the department store are cheaper at online and scan the bar code. In theory these are all really good apps.

But in practice, no one gets reception in stores. In a time where wireless internet is almost ubiquitous, we still can’t check email in the bottom floor of a Nordstrom. It’s awesome to have all these apps available but my dear retailers, if you are going to offer one meant to be used in your store, you better role out some free WiFi and MAKE A MOTHER FREAKING MOBILE VERSION OF YOUR TERMS AND CONDITIONs PAGE! Why do you never see this anywhere?

Image: e-MagineArt.com

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