NezSez

A couple of years ago, a friend bought one of my kids a toy bowling set. They took to it immediately and played and played with it. However, it wasn’t long before we noticed cracks developing in some of the pins.

Sure enough, at one point, one of the pins broke into several pieces after a particularly “intense” frame. I could only surmise that cheap, brittle plastic was used in the set’s construction. No doubt the toy was bought at one of those “5 and dime” stores (inflation has turned them into dollar stores).

Looking for Bargains

I’m not against being frugal — it used to be that I was always on the look-out for bargains. But, especially after that experience, and being self-employed for the last few years, I am more acutely aware that there is a lot behind the final product or service we see in ads or stores.

To Get Products to the Stores

Now, whenever I see a product — whether it’s a toy, or a piece of furniture, or even a car — I also see it as something that has undergone a production and distribution cycle that include things like conceptualization, resource acquisition, creation, distribution, marketing and customer service. (I apply the same evaluation for services: painting, roofing, landscaping, etc.)

Costs are Incurred at Every Step

I then think about the price in terms of the wholesale costs for each of these steps:

• conceptualization - paying designers, engineers, inventors, research and development, etc.
• resource acquisition - paying for, and growing and harvesting raw materials, digging them out of the ground, refinining etc.
• creation - the actual process of construction, through labor and/or machines, all of which must be paid for
• distribution - packaging, shipping, trucking, etc.
• customer service - retail services, warranties, repairs and replacements, etc.
• support infrastructure - all the buildings, administrative staff, insurance, etc., needed to run each of the above “components”

Economies of Scale

I also take into account whether the item is mass produced, or whether the service is provided by a local small business — since materials or services do not come cheap on a single unit basis — in order to see if product is (seemingly) affordable, or worth what is being charged.

When a Bargain is Not Really a Bargain

However, when I see a product that is too cheap, then I have to assume one or more of the following must be true:

1. Outsourced manufacturing - The product is produced overseas, where wages are much lower, and worker treatment may be substandard or abusive, such as sweat shops
2. Remainders - the product is being dumped, sold at a loss because it couldn’t be sold otherwise. No one really wants it because it’s a piece of junk
3. Product Sold at a Loss - a strategy to gain market share, stifle competition, etc., like what Microsoft is doing with the Xbox 360
4. Short-sighted Management - product is manufactured with profit as the only motive — people and resources are unduly exploited for short term gain, perhaps a disregard for health and environment, etc.
5. Product is made of shoddy material, or with materials that might be unsafe - lower grade ore, cheaper plastics carcinogenic paints, leaded materials, less robust circuits, etc.
6. Product is unreliable - poorly designed components, mediorcre workmanship, and such can result in an inferior product like a cheap PC, or a car that’s a “lemon”

If it’s a service, then I have to consider whether or not the person offering the service is executing sound business practices. If the price is too low, he or she may be subsidizing the service with income from a full-time job. If there is no other job, then I would wonder whether this particular small business will be around in a year or two.

Cheapest May Not be the Best Option

So as you can see, sometimes purchasing a product or service based on the cheapest price will not turn out all that beneficial.

The product may be unsafe or it may break sooner than later — such that you need to junk it, contributing to our landfills, and need to go out and buy a replacement. Or returning it or getting it serviced may be more trouble than it’s worth due to poor customer service.

The service may turn out to be a one-time thing, with little or no recourse if you are unsatisfied.

A lot of times, we don’t think or even consider any of these things — we’re happy to simply buy, buy, buy.

photo credit: *tdl*

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Have you ever:

• Shared a joke with friends?
• At a game, gave a high five to a complete stranger next to you after your team has just made a tough score?
• Chatted with a coworker about a TV show at the water cooler?

What do these three actions have in common?

They satisfy a need to belong.

The Instinct to Belong

I’m sure the development of this need harkens back to the days of the caveman — banding together was the prudent way for early man (and woman) to survive encounters with woolly mammoths, saber-toothed tigers and the like (oh, my!) — those who didn’t, did not survive, and so the instinct was passed on.

Today, however, with those dangers extinct, we find other reasons to bond together. In the end, after food and water, and perhaps shelter, that next need is the need to feel a part of a group, whether it’s a life-partner in the form of a husband or wife, or something beyond a simple pairing.

Benefits of a Group

Indeed, there many benefits to being in a group

• Teamwork - working together can overcome many weaknesses
• Social skills - being successful usually means developing social skills
• Respect for others - the best teams usually have members who respect one another
• Support from others and camaraderie within the group - when one member is down, the others can pick him or her up
• Getting things Done fast - such as in an assembly line
• Brainstorming ideas in a meeting
• Strength in numbers
• Specialists are able to be developed or recruited, since other aspects are handled by others in the group, etc.

In fact, achievements such as building the Golden Gate Bridge or Hoover Dam is only possible through the power of a group. The strongest nations, the strongest corporations, are all groups.

Being in The In Crowd

It’s more than a great Ramsey Lewis composition, the “in” crowd is what makes us feel happy when we belong to one, and certainly makes us feel bad when we don’t — whether it’s a discussion on the latest episode of Heroes, or joining the after-work soccer team, the good feeling we get from being part of something is usually ingrained in all of us from the time we’re born, with things like:

• Being held in mommy’s bosom, where it was always warm and safe
• Cuddling with a parent as a toddler
• Playing in small groups in preschool

And then leading on to:

• School clubs
• Spelling bees
• Kick ball teams
• Birthday parties
• Sleepovers
• Music class
• Little league

Then we hear conversations like:

• “Oh, my kid got into the GIFTED program.”
• “My daughter’s teacher is Ms. Smith — teacher of the year.”
• “My son got into Harvard.”
• “My daughter got a full scholarship.”

These are all everyday conversations we might hear, but they all seem to point to one thing.

A Sense of Competition, and OneUpmanship

In our society, we are taught to (try to) thrive on competition. That push to be better than the other guy or gal is oftentimes a great motivator, and many individuals excel. As a person develops their skills, he or she may find him or herself:

• on a team, or even an “elite” team
• in a fraternity or sorority
• in a club
• joining a political party
• becoming part of the workforce, for a company, or starting his or her own
• at a company, become part of a department
• joining a union, and so on.

The Dangers of a Group

As we can see, society inevitably puts us into a group. And while we’ve seen the benefits of being in a group, there are also many dangers. Those dangers also begin early in our lives.

For instance, in school, we get the “bad apples” who are immediately grouped by being sent to detention. “Loners” may be shunned by the rest of the students for being “strange” or “radical”.

At work, sometimes the employees (”us”) versus customers (”them”) will result in poor customer service — ever get the “that’s not my department” line from an employee? Or a certain department (HR or Accounting or middle management) will eliminate members of the “regular” employees.

However, the true dangers come from exploitation of individuals in the name of the group, simply because the need to belong is so strong:

• Gangs - the need to belong is strong enough to entice some young people to join a gang, where terms like “family”, “brother” or “sister” are often used. Actions are executed in the name of the gang — “initiation” rites, such as robbing someone “outside” the family, turf wars, and worse — done to elicit praise from the leader(s), to get that love that is perhaps missing from their own (broken?) homes or parents that are too “busy” or uncaring, or to have a purpose
• Fanatic groups - think of the extreme right, groups led by zealous fanatics who use their charisma to gather a devoted following, oftentimes pitting them against the rest of society or other groups deemed unworthy, promising deliverance for successful execution of their agendas
• Religion - Religion is supposed to based on teachings of their founders (Christ, Buddha, Mohammed, etc.), and these teachings are taught by those who know “the truth” — the religious leaders — and so they form the group at the top, a group that has great power. But, some of these groups inevitably abuse that power and become corrupted. For all the good that is done, there are also great harm done in the name of religion. Think the Spanish Inquisition, the Crusades, and so-called “Holy” wars
• Politics - the “us versus them” card is often played here as well, resulting in impasses on policies at home, questionable campaign contributions that can sway decisions one way or another. Groups can cause civil unrests and other disturbances. Special interests are groups as well, and have sometimes been linked to conflicts and wars abroad. There are many examples today, but easy historical examples include Hitler and the Nazis, the plight of Native Americans, global Colonialism, Yellow Journalism, etc.

Suppression of Individual Thought and Critical Thinking

It’s easy to see how the group can be exploited by its leaders. Through the use of peer pressure, fear (of being cast out, or even losing his or her life), or simply the promise of love, individual thought and critical thinking can easily be suppressed, forgotten, or simply abandoned.

This can lead to the Lemming effect, where individuals simply go along with the group, not really knowing, or caring, in what direction they’re headed — mob think.

But I think a lot has to the do with the ones who lead the groups. Be it a gang, political, religious, corporate, whatever, leaders of groups have great power. And sometimes decisions are made not in the best interest of the group, but rather in the best interest of the leaders (e.g. to preserve their power and status).

Group is Great But One Still Has to Think

In the end, I think it’s important to be aware of the grouping phenomenon/instinct. Unless one is a total hermit, becoming part of a group is inevitable.

One still should practice critical thinking, especially when the direction we’re headed is not ideal, and voice his or her concerns, or simply leave the group.

One still needs to tell the Emperor he has no clothes.

The Group to Which We All Belong

Ultimately, we should remember that, whether we want to or not, from the moment we are born, we already belong to one group.

The human race.

The World is Full of Mysteries

Ever notice how much mystery plays a part in our lives?

“Peek-a-boo! I see you!”

That innocent game we play with a baby is probably the child’s first conscious introduction to mysteries. When the blanket is up, where did mommy go? When it’s down, oh, there she is!

From that moment on, we are constantly engaged in solving mysteries.

Going to school allows us to find the answers to the mystery of:

• spelling
• arithmetic
• whether or not Susie likes Calvin

Mysteries are what fuels scientist’s curiosity:

• Are birds descendants of dinosaurs?
• Who built the giant statues of Easter Island?
• What can we do to save this species from extinction?

Many of us face personal issues to which we seek answers, such as those offered by unscrupulous marketers:

• “Learn the 10 Secrets the Pros Don’t Want You to Know!”
• “Lose 30lbs in 30 Days!”
• “Get Rich Using these 5 Easy Steps!”

We seek out and are entertained by mysteries in stories such as:

• Sherlock Holmes
• Indiana Jones
• Harry Potter

Why are Mysteries Important?

If you don’t think mysteries are important, let me ask you the following:

• Have you ever seen a movie where you start realizing what’s going to happen before it happens? Ruins the fun, right? That’s like telling people Darth Vader is Luke’s father before they saw Empire Strikes Back in 1980.
• Or how about seeing a magician do a trick that you’ve already seen before? The effect is not as…magical.
• Or why a woman wearing revealing clothing that much sexier than if she was simply nude?
• When you go see an Opera, Ballet, Musical, or Play at the theater, what if they didn’t have a drawn curtain?

We Love the Tease

Ever hear advice about writing a cover letter for your resume? Or how about a book proposal, or any proposal. What about the opening minutes of a TV show? The inside cover of a book jacket? Magazine cover? Promotional mailer?

They all feature something short, quick and easy to remember — to tease you into looking for more.

The best ones present a compelling mystery, one which you are eager to solve.

The Quest for Knowledge

• If fiction, we have the “MacGuffin”, what director Alfred Hitchcock referred to as an object or person — SOMETHING! — that is being chased after, sought after, and fought over. That continued searching is what the viewer of his films get hooked on.
• In Dashiell Hammet’s Maltese Falcon - detective Sam Spade is after the “black bird”, a supposedly jewel-encrusted statuette worth millions. His partner is murdered, and various parties are all after the falcon. What’s going to happen?
• J.R.R. Tolkien’s Lord of the Rings - how is Frodo and his band going to destroy the One Ring, in the face of overwhelming odds?

In real life, we have the quest for knowledge.

• Buddha, in the process of becoming the Buddha, sought to answer to why humans suffered
• Leonardo Da Vinci, the Wright Brothers, and other dreamers sought out the answers to flight.
• We each all have our goals, and often wonder how we are to achieve them.

Mysteries engage our minds, our imagination, and our creativity.

The Mystery of Blogging

It even applies to our blogging.

Why do we ultimately subscribe to someone’s RSS feed?

To find out what’s going to be written next.

Have a great weekend!

I leave you with the following inspirational video clip:

TEDTalks: J.J. Abrams: The Mystery Box

Jame’s post on PLR articles yesterday got me thinking. What’s wrong with the PLR articles?

Too Much Run-of-the-Mill Content

PLR articles or Private Label Rights articles, if you don’t already know (I didn’t), are pre-written content that a subscriber can use for his or her own blog. Ideally, the blogger using the article will dress up the content, add his or her own twist to it to avoid having the exact same content as someone else who might have signed up (read: paid) for the same batch of PLR articles.

According to James, though, the proliferation of these cheap, repackaged material that is sold to thousands, if not tens of thousands of bloggers looking for content (with “low” prices, so volume must be high to gain profits) to fill their blogs will overwhelm the internet as we know it, burying us in a flood of recycled content that is old, stale and regurgitated.

The Microstock Business Model

What James is describing sounds similar to what professional photographers are experiencing in recent years as well, specifically with stock photography.

With free photo sites like Flickr (which is great!) and multitudes of “penny” stock — or microstock — image companies, the past work of photographers sitting in the vaults of the giant stock image companies become less valuable. Certain new work undoubtedly is worth less as well due to increased competition. (Wikipedia entry on microstock photography)

Professional photographer John Harrington, in his Photo Business Blog, describes it best: who needs to license a picture of the White House when you can find (a free) one on Flickr that is just as good?

Just as James sees PLR articles as a bad business practice, Harrington also finds the microstock model lacking as well. The once almighty Getty Images bought one of the larger microstock companies, iStockPhoto, and consequently shot themselves in the foot, according to Harrington. Why pay $200 when you can pay $1 for the “same” image? (Getty was recently sold to a private company, so we will see if doing so will mean a shift in focus back to doing what’s beneficial to their content providers — the photographers instead of what shareholders want — the bottom line.)

What’s Wrong with the Microstock Business Model?

I bet in the beginning, the early adopter photographers who put up their images on sites like Shutterstock, which currently pays 25 cents per download, made off pretty well. On this particular stock site, it pays 25 cents to the photographer for each of his/her image that is downloaded, so it states if your image gets downloaded 2000 times, you get $500. Sounds good, right?

Well, it is if you, the image-creator, were on a roster of only several hundred photographers, and you had at least a few dozen top-selling images: $500 x 20 images per month = pretty good money!

However, the site mentions these stats as of today:

• 3,141,584 royalty-free stock photos
• 36,756 new stock photos added this week
• 91,940 photographers

Over 90 thousand photographers. And over 3 million images. Seems like a lot of great choices for the end users: tons of high-quality, royalty-free photos at low, low prices. But how is it for the content creator — the photographer? Of 3 million images, how many are “top-selling”? One must realize that if the supply far, far outweighs demand, the likelihood of anyone having a top-selling images becomes marginally better than winning the lottery.

How many images does the photographer need to have that sell? Would they get enough payment to make a decent living? If not, they’ll have to do something else instead of creative great images, wouldn’t they?

Who actually makes the money here? Hint: the middle-man (remember it’s a numbers game.)

PLR Articles is the Microstock of Professional Writing

I believe Jame’s sentiments about PLR articles is the same as what I’ve described about the microstock business model. The people that truly profit from PLR articlers are the ones selling them — the middle men/women who promise writers hefty pay-out for their well-researched, well-written content. Those content-providing writers who got into the game first are sure to do well, just like those early-entry stock photographers, but as more and more dive in, the result will most likely mirror what’s happened with stock photography — writers would have to write more and more content to generate the same income, most likely resulting in poorer work, and devaluing the overall web experience.

What Will Happen?

While James may be going for the dramatic flare when he says the influx of run-of-the-mill, repeated content will CRASH the internet, I have to think that while the internet will most likely survive, the writing landscape will undoubtedly change.

According to Technorati’s State of the Live Web report (April 2007),

• approximately 120,000 new blogs are create each day, or 1.4 per second
• bloggers write 1.5 million posts per day, or 17 posts per second

Mind-boggling, er…rather, mind-bloggling when you think about it.

What will happen in the end, I think, will be up to us, the bloggers who care about what we want to say, and ultimately who care about our readers.

Already, I see some hints of things to come, but I’ll save that for a future post. Thanks for reading!

We often think that we need to drive less, or buy a more fuel-efficient automobile to lessen our dependence on fossil fuels. At least that’s the general rhetoric we hear from pundits.

Of course, I’m all for conserving our resources, so I have nothing against driving less, and using less gas. (I even encourage efficient driving.)

However, I’m wondering how many people know that another all too convenient consumer product comes from oil.

Plastic.

Plastic Comes from Oil

It’s true that recently, there are plastics made from organic materials (such as the Biobags that are made from corn, mentioned in my composting post) but the vast majority of plastic still comes from petroleum.

Therefore, if we really want to conserve our oil supply, we should each do our part to dump as little plastic into our landfills as possible, since dumping plastic is like dumping oil.

Here’s how:

• Ask for paper instead of plastic - when possible, of course. Here in San Francisco, the city Council passed an ordinance requiring paper bags be used by stores over a certain size.
  
• Better yet, bring your own (reusable canvas bag)
• Recycle as much as possible (instead of dumping it in the trash) - trash goes to landfills, recycling goes to recycling centers.
• Take packaging into consideration when making a purchase - meaning, decide if there’s an alternative product that uses less packaging, or use material that can be recycled easily (like paper).
• Buy less stuff - probably worth an entire post to discuss this.
• Consider buying recycled products - such as those by Recycline, found at stores like Whole Foods Market and Trader Joe’s, these include items like toothbrushes and razors, to cups and plates, to name a few, all made from recycled plastic. Plus, they can be recycled as well.

Plastic Consumption in Perspective

If you’re still not convinced that buying less and recycling plastic is a good idea, here’s a link to artist Chris Jordan’s photographic work. He has a series of photographs depicting the amount of stuff we (in the United States) use, and a lot of the stuff is made from plastic.

It really puts things in perspective.

Barbara’s comment on my Frame of Mind post reminded me of one of my philosophies of life:

• No Matter How Rich You Become, Someone Will Always Be Richer (unless your name is Bill Gates) - So, live your life without hurting others (and without whining), and maybe help those that are truly in need.

And here’s the corollary:

• No Matter How Poor You Become, Someone Out There Has It Worse - Everyone is entitled to some bad luck now and then, but it’s not the end of the world. Pick yourself up, dust yourself off, and start all over again (great tune, btw).

What do you think?

There are thousands (or millions) of sites devoted to finances, financial responsibility, getting/staying out of debt. Visit any self-help section at your local bookstore and you’ll also find hundreds of books devoted to the same topic.

I thought I’d sum up what I’ve seen, read, and (for the most part) practice - the number one rule to financial responsibility. However, to write only one sentence seemed almost like…cheating. So, in the interest of verbosity, I did some more thinking on the subject. Here’s what I came up with:

1. Earn More Than You Spend - the optimist version
2. Spend Less Than What You Earn - the pessimist version
3. Savings = Revenue - Expenses, where Expenses < Revenue - the mathematician’s version
4. Net Income = Gross Income minus Total Expenses and Deductions (you did save those receipts, right?) - the accountant’s version
5. Buy 1 less Cup of Coffee a week to save $20 a month - the conscientious Starbuck goer’s version
6. Every month, pay into your retirement, then your bills, then whatever’s left is extra - the Financial Guru’s version
7. Every month, pay into your retirement, then your bills, then half of what’s left can go into the “games” - the Reformed Gambler’s version
8. Every month, pay into your retirement, bills, and then buy ONLY one pair of shoes (that costs less than what you have remaining) - the compulsive shoe buyer’s version
9. Every day, save a dollar, spend the rest - the homeless person’s version
10. When you see a 10 dollar bill on the ground, DON’T pick it up - the Bill Gate’s version

In recent days, I have both received in the mail and seen on television advertisements for California Propositions 94 - 97: Indian Gaming Compacts.

While this is not a political blog, seeing the ads on Indian Gaming reminds me of my thoughts on gambling in general.

The Truth about Gambling

To stay in business, a casino must earn more in revenues (e.g. the “house” must win, the players must lose) than it spends on expenses (e.g. restaurant buffets, staff, decor, power, etc.). The fact that gambling is a multibillion dollar industry means that the business model must be working pretty well. And doing any sort of research will tell you that all games are stacked in the house’s favor, some more so than others, but in the house’s favor nonetheless. So, the question is whom does the casino “earn” their money from?

Gambling is Marketed to People Who Should Not Gamble

I see the ads on cable, the billboards along the freeways — these are meant to be seen by everyday people. With gas prices soaring, and housing in the Bay Area among the most expensive in the nation, should people be gambling, hoping to get easy riches?

The Illogic of Encouraging Gambling As a Means to Raise Funds

I have been known to visit a casino or two, usually during “downtime” on a ski trip — we usually just eat at one of the buffets in the evenings and a few of my friends would try their luck at the craps or blackjack tables. What I’ve noticed is that the majority of the gamblers are very “average”, normal clothes and attire, nothing like the glamor of a James Bond movie or anything like that (maybe I’m in the wrong casino). So, the very people that are supposed to be helped by social programs, are the ones that are footing the bill. But guess what? It’s not a dollar-to-dollar transfer. The money that the Indian casino wins are divvied up along the way to middle-men (administrators, campaign contributions to politicians, to name a couple), and who knows how much actually comes back to those social programs — certainly a lot less than what left the gamblers’ wallets.

What about the Rich?

I have to think that 99% of the Rich did not get wealthy through gambling, but rather through hard work, investing, stock options and the power of compound interest. Once they HAD the money, that’s when they can go gamble as “high rollers”.

The End Does Not Justify the Means

As for the propositions, we’ll see what happens in next Tuesday’s elections, but I certainly don’t think encouraging gambling ever helps anyone except whoever owns the casinos.

Why We Should Like Corporations

Simply put, corporations allow for massive economies of scale. That’s how we can buy a reasonably good car for $13K. That’s how we can buy groceries at the local supermarket. And that’s how we can get our new-fangled technologies (on which to write and read blogs).

Why We Should Hate Corporations

Again, simply put, corporations usually answer to shareholders, and what the shareholders want may not be in the best interest of the non-shareholders (see my post on smoking). Since there are fewer shareholders than non-shareholders, the few have power over the many.

What Can or Should We Do?

• As consumers, use critical thinking to be aware and not be taken advantage of.
• As shareholders, employ the same insight to see beyond short-term gains.

Think About It

A corporation is legally considered an entity, but in the end, a corporation is really made up of people. As people all living on this planet, shouldn’t we think beyond us-versus-them, and instead use the power of corporations to find a way to live in a peaceful, sustainable world, one that will endure for future generations, long after you and I are gone?

In the “Beginning”, We Were Farmers

The United States started out as 13 colonies, where one of main focuses was farming, since everyone had to eat. Households had farms that provided most of their needs, and any excess can be used for barter, trading, etc. Only with adequate food could there have been development of trade, much less the Revolutionary War. I’d say farming was king.

Unparalleled Growth In the Intervening Years

Over the ensuing decades, social, economic, and technological development resulted in increased populations, and mass production of foodstuff. Industrialization resulted in a multitude of products. Cars and planes brought helped make the world a bit smaller. We got a couple of World Wars, the Baby Boom, the Golden Age of Television, the Age of Information. During these times, most of our foods came from giant corporate farms who supplied massive factories, fast-food chains, etc. They still do now.

Coming Full Circle In Recent Years

But now, we are learning to shop local farmers’ markets, end the use of chemical fertilizers, go organic, reuse, recycle and compost (I’m all for that).

Wanting to escape from the modern “rat race”, some families even move out of the big cities, onto their own land.

To farm.