How Not To Blog ?

MBNA, Citibank, and Bank of America have announced they are doubling minimum monthly payments on credit card balances from 2% to 4%, in response to a request by the Office of the Comptroller of the Currency. The 3 companies account for 39% of the US credit card market.

The average US consumer has $8,000-$10,000 in credit card debt across 8 cards. This means they currently pay about a $160-200 minimum. With this increase, they?ll pay $400.

Looks like more Americans are about to get into trouble, considering that 20 percent of credit cards are maxed out, and just 40 percent of Americans pay off their accounts in full each month.

The average consumer will then need an additional $1,920-$2,400 every year to keep out of hot water. Some persons with balances of $50,000 or more across several cards will pay an additional $12,000+ per year.

It would be fine if consumers were given significant lead time in the 200% minimum payment increase, but that's not the case. I seriously doubt that the millions of Americans that only pay the minimum will be able to double their minimum payment on the debt they already owe.

Standard & Poor's cut General Motors Corp.'s and Ford Motor Co.'s debt ratings to junk status. Nearly $300 billion worth of debt.

That's too damn bad. Bitches should learn how to properly manage a company and continuously innovate and not just ride on its past successes. They've both bet the farm on gas-guzzling SUVs. How stupid can you be?

One more reason why the Bullshit administration, through the feds, want a weak dollar. It helps American companies perform in overseas markets and increases the value of their mostly-foreign assets. (But it also makes materials more expensive.) Trying to look good on paper has never been so bad!

Ahhh.. the wonders of imaginary wealth. At the end of 2004 US banks held $88 trillion in derivatives, up 24% from $71.4 trillion at the end of 2003.

The Bank for International Settlements put the global derivatives market at $221 trillion as of mid-2004.

That's $221,000,000,000,000.

Derivatives are "...financial instruments that have no intrinsic value, but derive their value from something else. They hedge the risk of owning things that are subject to unexpected price fluctuations, e.g. foreign currencies, bushels of wheat, stocks and government bonds." [from here]

I think I've a pretty good idea for a consumer web-based derivatives market, but I think that if it ever caught on the wealth ceiling would be too damn crazy. (Besides that, it would be quickly taken over by corporations.) I'm not yet sure how natural a process the accumulation of immense abstract wealth is.

Money should be backed by gold, not backed up every night at 2AM by some geek sitting at a computer. This isn't a game. These are people's livelihoods. (Yes, this would make for a much, much smaller global economy. Is that so bad? What's our fucking hurry?)

I don't believe wealth should be evenly distributed, however. You can have a balance that doesn't look like the ease of 50/50*. I personally believe some people desire immense wealth and others desire extreme poverty, to facilitate their understanding of the world about them. Our brains may desire more money, but our hearts may know better. I see life as a type of game, to be played over and over again every time we see the sun rise. But losing touch with reality is a different story. There should be a theoretical limit to wealth just as there's a theoretical limit to resources available. With money backed by gold, there is. With our current financial system, there isn't.

*Just think about the size and placement of bodies in our solar system. The system is perfectly balanced but not in a 'politically-correct' sort of way. PC would never work in the real universe, and should not work in our own world, either. We think we're being fair when all we're being is stupid and ignorant.

Potential buyers in Los Angeles are offering tens of thousands more than the already-inflated asking price for homes. Not only that, a lot of buyers are now starting to send flowers, their pictures and bios, and other shit to sellers.

Reminds me of late 20-century stock market stupidity.

Foreign investors may be partly responsible, due to the weak dollar and low interest rates.

People just don't learn from their mistakes. No, it's not another stock market bubble, dumbass. It's the real estate bubble.

Looks like Asian markets closed down today. Japan is down -3.80% and Hong Kong -3.62%.

European stock indices also opened lower, an average of -1.92% as of this writing.

If Monday's numbers don't paint a rosy picture of the economy, the Dow most assuredly will fall into the feedback loop. The Dow had lost 3.57% last week. A Monday close around the 9,600-9,800 range would put it with its international peers.

It's all artifically inflated anyway. I'm surprised the illusion has kept up this long. Were it not for online trading enabling millions of clueless Americans to pump tons of fresh cash into the markets, the bottom line would have sank to the abyss long ago. Expensive oil, however, means that big countries will go to war over access rights to oil producing nations. Who will stir this time?

Following I illustrate what could be a new breed of auction system:

::All bidders in an auction, except for the winner, must pay the highest amount they bid to the winning bidder if they lose.

::The winner of the auction then pays the seller's reserve price (known since the start of auction), and keeps the remainder for his/her self. And, of course, wins the auction item. The reserve price is paid regardless of whether or not a winner's profit will be made. (All payments are made automatically by the system.)

or better yet,

::All bidders in an auction, except for the winner, must pay the highest amount they bid to the seller if they lose.

::The possibility that each person could be the winning bidder and end up paying nothing for something they desired would (hopefully) put upward pressure on the price.

::The seller's sense of risk is decreased by the prospects of receiving much more at the end of the auction than that being sold is worth.

In each scenario, the bid price could be lofted dramatically by each bidder's greed. In the two scenarios, the winning bidder essentially could pay nothing and come out ahead.

In the first scenario, "Winner Takes All", bidding for a $200 item could reach an average of $8-9 across 75 participants, for example. You would probably have more participants bidding the price up than in the second scenario due to the winner's added incentive. Most bidders would bid extremely low at first, but towards the end of the auction would probably bid up the price dramatically in order to win.

In the second scenario, "Winner Slides", bidding for a $200 item could reach an average of $6-7 across 50 participants, for example.

How much is a person willing to risk to get something for nothing (or nothing-plus-risk)?

The number of participants would, of course, be limited so that the prospects of winning are still appealing to each bidder. You would also need an escrow system whereby a person would make deposits and then bid against those deposits.

It is, in effect, an auction lottery.

Ming's post about psychologist Max Bazerman's experiments with his students and a bit of money got me thinking on the above.

I had a feeling Alan Greenspan was full of shit.

"According to sources at the Fed, Greenspan even takes pleasure in his obfuscation. Sometimes he will return from one of his speeches before Congress and order a video of his testimony, marveling out loud as he watches: "What in the world does that mean?" Obstruction, then, is the name of the game.

I think I recall taking a leak with him at a party once. Dude's gotta be at least one of the richest persons in the world, if not the richest.

Every blogger in blogspace knows that Adsense sucks. Not many speak up about it. Afraid of getting banned from Google?

Most likely, Google is ripping you off. They won't even tell you what percentage you're getting. That's so funny. With any other company you would simply refuse to do business with them. With Google you're just taking a beating willingly. The reason they don't tell you is because it's so fucking low, you would be pissed.

Bend over, my friend! I'm going to wow you with my colorful logo and cool algorithms before I punch you in the ass. Behold! A nifty little script to install on your Blog and provide us with half a billion in Adsense revenue to add to our ever-growing Adwords pile of cash. You keep blogging, we get rich. Isn't life grand?

Are you serious?!?! Any Adwords advertiser (the system used to display your Adsense) knows that the 'content' part of their campaigns sucks big time. An ad that gets a 5-10% click-through ratio on Google search is lucky to get .8-1% on your blog. The shit's not targeted, and not interesting. They're raking in the big bucks, anyway, so they don't really care about you. As long as you remain interested in the possibility of making $20 next month with your blog and maintain faith in the Google brand they've got you.

Really, they should call it "AdCents" and get over with it.

What Google should do is let the publishers know exactly what percentage they're getting. Then they should increase the percentage to a fair 50%. (I'm guessing it's about 5-8% now from my Computor's calculations).

In China, Microsoft will start offering large discounts on its products to those who have bootleg versions and are willing to rat on their suppliers.

Who in their right mind would think of something like this? This is as stupid as Ballmer wanting to make PCs in China and India cheaper than the software you want on it.

The "discount" of 50% is still expensive for most Chinese, which is why the black market for software and other media thrives. Walk through any market in any good-sized city in Asia and you will find every kind of Microsoft product imaginable for $4 or less. (Even this is a little expensive.)

As far as they're concerned, the product is real (the CDs work 95% of the time, just like the authentic version - ok, so I know some people). So much for US companies losing billions to piracy - tell me how? Most of the people who purchase the bootleg versions would never in their lives have paid full retail price for it. In many large cities you can't even find a place that sells software. Much of the piracy that occurs is in internet cafes and other communal settings, where one bootleg copy is ghosted to every computer. A lot of students use Excel after class to work on a project, for example.

By the calculation of companies like Microsoft, every person who used a bootleg version was actually going to purchase the full retail version, but the bootleg was cheap and readily available so they purchased that, instead. This kind of tomfoolery sounds great in the news, but there's no substance behind it. It would be interesting to see some research done that reflected the reality of piracy in developing countries.

They should actually be thanking pirates for doing them a favor and ultimately helping their bottom line by the magic of free brand building and free advertising. They get $0 distribution and marketing costs all across Asia and South America, among other places. Consider it a promotional copy that got way out of hand. (But that's good under certain conditions, right?)

Here's the How for Microsoft...

If everyday Chinese are forced to buy Microsoft products, they wont. (Unless it's the same price as the bootleg - market forces are at work here. And there's no way to stop piracy in China. You've got to be kidding!)

If you crack down too hard (wasting much precious time and resources with nothing substantial to show for it in the end) then the market for FREE software will explode leaving you with no street cred in the largest consumer market in the history of humanity.

Let piracy flourish with Microsoft products in developing countries. Build your brand among the up-and-coming class. Educate them about how your crap smells a better than the free, low-class crap they could be using right now. You're Microsoft, dammit. "You want to be rich like Bill Gates? Then buy from Microsoft." Fuck Windows Longcock. Call it Windows VIP. Use slivers of real gold in the product packaging. (No pirates in their right mind would want to follow you.) Suck their little Chinese penises with every Enterprise Server purchase. They'll love it!

Then, when they're middle class enough to purchase your products, most of them will. If a few people who now could afford to purchase your products don't.. so what? Heck, I started using Windows when it first came out.. but I didn't actually buy it until I was older and could afford it. That first copy of your shi7 product made me very proud. I still love your shi7 products for some unknown reason. Even the Linux nerds keep multiple OSes and IE on their boxes.

My guess is that for every dollar companies like Microsoft, Time Warner, Macromedia, Adobe, Disney want lawmakers to think they're losing, they're probably only really losing about 5-10 cents. Firing a few thousand overpaid WASPs is a whole lot easier and cheaper than combatting international piracy.

They should just shut the hell up, focus on piracy in rich countries like the US and Europe, and devote more time and energy to building better products - the kind that are actually worth the pirates time and effort - and try to understand the value of a little creative disruption.

Embrace what China is. Don't work against it. It is changing. Are you?

The current issue of the Economist continues to make mention of US Dollar's future prospects, which at this point look pretty bleak. Korea is now starting to diversify its holdings. If China does, we're screwed. (Guess who's holding the trump card in international policy?)

The dollar fell against leading currencies. Markets were spooked by the decision of the Bank of Korea to diversify its currency holdings, increasing speculation that Asian central banks were moving away from the dollar as a reserve currency (this would cause a problem for America in financing its current-account deficit). The greenback recovered somewhat after the Bank of Korea said its decision did not mean it would sell the American currency.

The major problem is that Asian countries, with China in the lead, are pumping too much money into the US economy, via treasury bond purchases. They do this because the US is so fucked up when it comes to managing spending. If Asian countries don't do this, their own economies would deeply suffer.

Letting the dollar fall against the Euro and other major currencies is not a good way to reduce the current-account deficit (now stands at $603 billion). Prudent spending and planning is the only way to save the US from going to hell.

Unfortunately, with a mighty a77hole at the helm, the only prosperity we will see in the future is on the battlefront.

No solution here but personal ones - it's a bad bet that anyone at top would come to their senses soon enough. Hedge.

Just follow my 6 Point Plan to Not Getting Screwed in the Ass (unless that's your thing)

1) Open a foreign-currency account. Euros is probably a good idea, though you could also invest in China by opening a stock trading account in Hong Kong. My money is on India, though, as soon as they build some roads and install electricity. Chinese people want to dominate. Indians want to integrate. The age of domination is over. The US fucked it up last and we have turned off the lights.

2) If the dollar fell 8% against the Euro the quarter previous, be sure to somehow recoup at least 8% of your income the next quarter. This could mean selling the shit in your garage, or selling someone else's shit. Or start an online business in a hot sector for $1,000 then sell it a year later to a lazy businessperson. Whatever. You don't want your money sitting in the bank. If your interest rates are lower than inflation you're losing money.

3) Fall in love with a well-off man and/or woman and lead them on for several months, getting them to buy you expensive things. If you do this several times per year, you won't have to work at all. You can just be a lazy, no good bitch with a nice TV and fat bank account.

4) Invest in fine wine. The good stuff always goes up. A good monkey in the middle will handle everything for you. A small investment in fine wine every quarter will help you recover your economic losses.

5) Tithe 100% of your earnings to your local Church. If you believe in the Lord, you'll get at least double your money back in 60 days in some way or 'nother. This is the best damn investment out there. Too bad they don't send you statements fiscal year end.

6) Stop reading pointless blogs like these and use the time to plan your escape from prison so you can actually make more than 11 cents per day, you spoonless lizard!