Monday, February 27, 2012

microloans; no panacea

"The Associated Press has obtained portions of a suppressed independent investigation into the role that debt collectors working for microfinance giant SKS played in the suicides of desperately poor borrowers in the Indian province of Andhra Pradesh. SKS made global headlines when it received backing from a US venture capital firm, the Boston-based Sandstone Capital, and then had a highly successful IPO. The independent investigation, commissioned by SKS itself (though the company has disavowed it) documents a pattern of usurious practices by vicious debt-collectors working for the company that drove several borrowers to grisly suicide."

I've posted about micro loans previously.  I think they are great, but then this kind of stuff happens.  People in poorer countries and locations need access to capital to start or expand businesses, just not as much.  Micro loans can allow a woman to open a seamstress business by giving her enough to purchase a sewing machine and some supplies.  Or let a farmer by a next-door plot to expand his income.

But of course, not all ventures work out.  The solution, then, is not to harass the loan taker until they commit suicide.  It is to work with the person and see what can be done from this point, or try to recoup what can be.  If micro loans become loan sharking, then they have failed.

Sunday, February 26, 2012

Earthships; a money and earth saving home building method

"Reduce and even eliminate your utility bills.
  • Get ALL of your electricity from the sun and the wind.
  • Catch water from the sky for drinking, bathing, cleaning, showering, washing, flushing, etc.
  • Contain and treat ALL of the sewage you produce in a healthy and beautiful way.
  • Maintain comfortable temperatures in your building ALL year long, in any climate. Reduce or even eliminate your heating and cooling bills."
Such are the claims for Earthship homes.  Here's an article on one in Montana. And here's a youtube tour of one being built.

These houses are labor-intensive to build and require learning how to maintain them, but after that it's smooth sailing and cost-saving.

Friday, February 24, 2012

loyalty vs. leverage; the changing world of employment

"It was no longer about loyalty; it was about leverage.
Do your job well, or at least make it look like you did. Leverage that into a better package from another company, one that has a pool table. After thirteen months there, leverage that into still another job, this time someplace with an arcade in the lunch room. And keep doing that the rest of your life, because three years with one company is an eternity, and you need to go with whoever has the best 401k plan because god knows you are NOT going to get a pension. Besides union jobs, who has those today, anyway?"

This is a pretty insightful post about the difference between our parents' work experience and ours.  Before it was find an employer where you fit and you're there until you get your gold watch.  Now it's keep moving and try to go up the ladder with every new employer.  No loyalty there, just taking advantage of opportunity.

Personally I think the entire system is in need of change.  I'm not sure what that should look like though.

your employer threatens to close down; solution - take over!

"Former Republic Windows employees called off the occupation of their workplace early today after its owner said it will keep the factory operating for 90 days while the union and management look for a buyer.
The employees, represented by United Electrical Local 1110, took over the facility on Chicago's Goose Island on Thursday for a second time in four years after they said the owner, Sunnyvale, Calif.-based Serious Energy, told them it planned to halt production immediately."

So where should the story go from there?  How about the employees take over and run the company and keep it going?  That's what's been happening in more and more places. There's even a movie about it, and a web site.

Monday, February 20, 2012

"economic growth" is a concept that needs to be retired

I just finished reading "Managing without Growth" by Peter A. Victor.  It's a scholarly book with lots of statistical stuff, but still I think he makes the point that our economic theories need to dump their reliance on "economic growth" as the panacea for all our problems.

It's actually just common sense that we can't grow our way out of economic problems. There is a finite limit to resources, such as metals and energy.  There is a finite number of houses that can be sold (and we've overbuilt now for quite some time).  And it's a smart thing to realize that our economy goes up and down, and there's no utopian future where the economy just constantly grows.

ultra fast stock trading causes concerns

"The speed in which the rises and falls occur might last no longer than half a second, unapparent to any human who is tracking prices. Johnson says if you blink you miss it. Flash events may happen in milliseconds and have nothing to do with a company’s real value.
To examine such incidences and their frequency the authors of the study waded through price logs from over 60 markets collected by Nanex, a Chicago company that sells streaming market data. The data revealed that the ultrafast fracture events were not infrequent but common, totaling 18,520 in the 2006 to 2010 time span. The authors looked for extreme changes in a stock price, which they defined as a change greater than 0.8 per cent, over timescales shorter than 1.5 seconds.
The speed in which ultrafast events happen is of concern as human oversight becomes impossible if trades are taking place faster than humans can react. Machine trading today carries computerized trading algorithms that make automated trades in milliseconds and make some experts uncomfortable, in the fear that out-of-control algorithms can cause a crash."

Should we just let traders do whatever they want, even if it destabilizes the entire system?  Capitalism requires oversight. That's just a historical fact.

Friday, February 17, 2012

long-term thinking needed now!

"The former CEO of Goldman Sachs Asset Management put forward five key actions which he hoped would revive the discussion on how to clean up capitalism and put companies, investors and stakeholders on the path towards long-term, sustainable profit.
These include ending quarterly earnings guidance from companies, which the authors said incentivized executives and investors to base decisions on short-term factors at the expense of longer-term objectives.
Companies have also been encouraged to integrate financial reporting with insight on environmental, social and governance policy so investors can clearly see how performance in the latter can contribute to the former."

Wow!  People are starting to imagine an economy that works!  Long-term thinking, concern about other aspects than the bottom line.  I hope this is a trend!

Thursday, February 16, 2012

Greece; proof that paying taxes is kinda important

"It is around this point, two years in, that Spinellis had a disturbing thought. A new item on his mind map. Fixing Greece's tax system, and ultimately making the Greek economy work, was not a matter of tweaking his computer programs. It was not an information problem. It was a culture problem.
If the people don't want to pay taxes, the collectors don't want to collect, and the politicians don't want to punish them, perhaps Greece needs more than a mind map.
At the end of 2011, Spinellis resigned from his government job. He's back to teaching."

The idea that taxes should be avoided at all costs now has a test case.  

Saturday, February 11, 2012

Did we receive those benefits of Technology?

"Three principal mechanisms are generating the financial troubles of the great majority of Americans. One is the technology that I had hoped would help them. In addition to eliminating many simple, repetitive jobs, e.g., many on assembly lines, sophisticated technology also eliminated many fairly high level jobs requiring knowledge and judgment, for example, in the control of complex, continuous processes such as those in a steel or paper mill. Word processors greatly reduced the need for skilled typists.
The second mechanism is the phasing out of factories in the US, with American companies setting up facilities in low-wage countries, or contracting out production of their products to overseas producers [Unger-3]. By far the most popular country for this outsourcing is China. Related to this is the export of work such as telephone help, and the interpretation of medical-rays.
The third mechanism that has made it difficult for many Americans to get decent jobs is the import of workers, mostly from low-wage countries [Unger-2]. Legal immigration is currently at an annual rate of about a million. There are also various "guest worker" programs that bring in hundreds of thousands annually, ranging from farm workers to nurses and computer programmers. In addition, there are roughly 11 million illegal immigrants now here, with varying (depending on economic conditions) numbers, of the order of a half million, arriving annually."

The things I remember while growing up is that technology would give us more leisure time, not more unemployment.  Live and learn eh?

Friday, February 10, 2012

Free college text books!

"But soon, introductory physics texts will have a new competitor, developed at Rice University. A free online physics book, peer-reviewed and designed to compete with major publishers’ offerings, will debut next month through the non-profit publisher OpenStax College.
Using Rice’s Connexions platform, OpenStax will offer free course materials for five common introductory classes. The textbooks are open to classes anywhere and organizers believe the programs could save students $90 million in the next five years if the books capture 10 percent of the national market. OpenStax is funded by grants from the William and Flora Hewlett Foundation, the Bill & Melinda Gates Foundation, the 20 Million Minds Foundation and the Maxfield Foundation."

Bummer, too late for my college career.  But this could save students hundreds of dollars per semester if it catches on.  I sure hope it does.