I always felt the New York Times was kind of the jack-of-all-trades paper more than the paper of record: somewhere approaching fair in its coverage of every subject, but not a standout in any subject.  Their book reviews would be the exception: They are far and away the best articles in the paper.

Harvard psychology professor Steven Pinker provides an excellent and fair review of Malcolm Gladwell’s newest book, What the Dog Saw: And Other Adventures, and in effect provides a review on the author himself.

I very strongly agree with Prof. Pinker in his praise of Gladwell as an essayist in prose, style, and his ability to provoke thought.  I am equally concerned with Gladwell’s somewhat lackadaisical approach to science (his writings tend to be in the realm of pop psychology, and the scientific rigour of his assertions seem to match that field).

The boldness — and counter-intuitive — nature of Gladwell’s assertions make the claims interesting and provoke further thought, perhaps the primary objectives of a writer or essayist, but tend to fall apart within the theses of his collected works (such as Blink, The Tipping Point, and Outliers).  As a result, I have always preferred Gladwell in the smaller units apportioned by The New Yorker over the lengthier helpings of his books.

Steven Pinker’s reasoned criticism is much needed considering the scope of Gladwell’s influence (I can hardly enter a bus or train without seeing one rider reading one of his books.  Which isn’t a bad thing considering the alternative would be Dan Brown or Harry Potter) and, as should be clear from my comments above, I agree strongly with Pinker’s review.

Simply put, enjoy Prof. Pinker’s review and keep it in mind the next time you read Gladwell’s excellent articles or somewhat unconvincing books.  Gladwell is a fantastic essayist, an extremely interesting and inquisitive author, but his writings are perhaps more properly viewed as very constructive than well-constructed.

[Nonetheless, I am always happy to see a new article of his appear at The New Yorker]

… and the cow goes moo

I work in Canadian retail banking, so I feel fairly well-qualified (or appropriately biased) to comment on this topic (to an extent, as substantial differences exist between Canadian and US markets).

I’ve been monitoring the debate and commentary as the subject has gained some prominence in the past year or so on such sites as Mish’s Global Economic Trend Analysis, Calculated Risk, and Naked Capitalism and feel that each has been providing important input, but have opted to under-represent certain viewpoints (though collectively, I think they have everything covered).

The New York Times (and the usually excellent PBS Frontline in an upcoming episode airing Nov 24, 2009, @ 9:00pm) are currently working on a major series called The Card Game to put all the trends in recent changes ahead of impending legislation into a collection of anecdotes and statistics.  And sadly, the series — so far anyways — are failing to provide the level of intelligent commentary that those above-mentioned blogs provide.

From the NYT article, “A Squeeze on Customers Ahead of New Rules”.  Please be advised the following large snips are mostly, but not entirely in order.  Really, the article isn’t long and manages to encapsulate a large number of telling statistics, so just read the damn thing.  Now here’s the parts that I felt begged for comment:

[Rates are up, lines are being reduced, applications are more heavily scrutinized, fees are changing, blah blah blah...]

“One recipient of new credit card terms is Anita Holaday, a 91-year-old in Florida, who received a letter last month from Citibank announcing that her new interest rate was 29.99 percent, an increase of 10 percentage points.

“I think it’s outrageous they pursue such a policy,” said Susan Holaday Schumacher, Ms. Holaday’s daughter, who pays her mother’s bills. “That rate is shocking under any circumstances.”

While the average interest rates charged by banks are lower than Ms. Holaday’s, her situation is not all that unusual. The higher rates and fees reflect the grim new realities of the credit card industry — the percentage of uncollectible balances has hit a record even as a new law may further limit the cards’ profitability.

…

She said she haggled with Citibank to try to get her mother’s bills forwarded to her house in Washington and, during the process, two bills were inadvertently paid late, resulting in the rate increase.“How unbelievably unfair for an older person who might not understand what this is all about,” she said. Citibank declined to comment on the account.”

Okeedoke.  Now this seems like a typical attempt at an unequivocally sympathetic case, and is standard fare in a general-population paper like the NYT, but what the hell do we learn out of this?  That Citi DOESN’T have an age-specific manner of adjudicating accounts?  I don’t want 91-year-old women paying high interest, but I don’t want credit card companies having separate risk and fee structures for every different age.  Seniors often enjoy special banking benefits as-is, and credit cards just seem to be one of the few areas where these perquisites seem to be lacking.

Ms. Schumacher expresses her outrage at the hike in interest rates, unacceptable to her “under any circumstances”, which the authors opt to omit from the article.  We are given no indication that the rate change was outrageous at all.  If Ms. Holaday has been late on payments recently, would that be acceptable or at least understandable reason to raise interest rates?

And of course, that final paragraph quoted (taken from the tail end of the article, where the rest was from the article’s start) reveals that Ms. Holaday has been late in her payments for at least the past two months and her interest rate hike notification came a month ago.  So what’s the fucking problem?

Oh right.  The problem is Ms. Holaday is 91-years-old, making her exempt from what is a very typical outcome of a series of late payments: A higher interest rate.  And that, by the way, is not a new response to late payments initiated due to mounting credit card losses or impending legislative changes.  It’s just another facet of the credit card business model of making customers with poor payment histories pay a premium over the most responsible borrowers.

Really, it’s not Citi’s responsibility to make sure a clients bills are forwarded to the client’s daughters house.  Or to assume a lesser degree of personal responsibility or ability to manage her personal finances of 91-year-old lady.  My grandmother isn’t 91, but doesn’t even read or speak English and her finances are fine because our family understands that it’s not the banks responsibility to make sure she pays on time.  The fact is, my grandmother should never be able to apply for a credit card as she would never understand the documentation, and my family skirts the rules by helping her with it, must like many families certainly do.  As far as her banks know, my grandmother can read a 12 page credit card application in dense legalese and agree to the terms and conditions.  And since I know better, if I hadn’t received my grandmother’s bill this month, I wouldn’t leave it up to her or her bank to make sure it all worked out:  I’d just pay her bill with a safe amount well beyond what she could possibly owe to protect her credit score and I wouldn’t wait for her mailed bills (that I’m not legally entitled to open) to make it to my door.  I know bills are due every month and I know my grandmother uses her credit card.  Because I don’t receive a letter isn’t enough for me to forget that fact.  If it was, maybe I’m not properly equipped to be handling other people’s finances for them.

Now that I’m done blaming poor Ms. Schumacher (I am actually sympathetic to her to a degree, as caring for elderly relatives in a climate where so few people are even able to take care of themselves is a massive responsibility), let’s rejoin the article as they continue blaming the credit card companies:

“As banks have become more aggressive in making changes, lawmakers have accused them of trying to impose rate increases before many of the new rules take effect in February. On Monday, the Federal Reserve provided new evidence of the banks’ actions. About 50 percent of the banks responding to the Fed’s survey said they were increasing interest rates and reducing credit lines on borrowers with good credit scores. About 40 percent said they were imposing higher fees. The banks also said they were demanding higher minimum credit scores and tightening other requirements.”

Now this is a pertinent bit of news and I don’t doubt it’s accuracy, but the article suggests the changes are all due to impending legislation.  It seems to me that it could be largely due to changing economics (there’s a crisis going on, and all), and loss mitigation.

Just because a credit card company is raising rates or raising fees, it doesn’t mean they’re ONLY trying to collect more interest or fees (believe it or not).  It is only logical to me that when customers are defaulting on credit card debt at a high pace (10% charge-off rate, so says the article), and the average interest rate is now 13.71% (so says the article), reflecting what appears to be a very low margin for profitability (expected losses over $2 billion in credit cards for JP Morgan over the first half of 2010, says the article), that you do your best to reduce your exposure within that line of business.

Most customers have multiple credit cards and logically (I know, consumers seldom operate all that logically…) should the interest rate or fee structure become less favorable on one card, it would make sense to move your business (and balances) over to another card.  Suddenly the 10% charge-off chance is now some other sucker bank’s problem.  It may be a bit of a circuitous route to the same result of just canceling someone’s credit card account, but it does provide them with an opportunity to earn a bit more or accelerate the inevitable default should the client not have the option or will to leave.

Let’s not forget that the credit card companies are rightfully seeking a profit, and profits for credit card companies have to come at the expense of the merchants (remember all those poor small businesses closing up shop?) and the cardholders.

“The nation’s largest banks are scrambling to figure out a new business model that fits within the new rules and current economic conditions. Those banks made handsome profits over the last decade by charging high interest rates and penalty fees to a small group of customers who routinely paid late or exceeded their balances.

Already, banks are shifting to a model in which a smaller pool of Americans will be eligible for credit cards, and customers with cards will probably pay more for the privilege through annual fees and higher interest.

Meanwhile, the banks are in the process of shedding customers considered too risky. That means tens of thousands of Americans will no longer be able to splurge on Nike gym shoes or flat-screen televisions unless, of course, they have enough cash to pay for them.”

Now here’s the most important facet of these changes (or perceived changes):  These changes may reflect the credit card companies adapting to a new economic outlook, a new and sustained level of heightened loss rates and risk, and the fact that the current model of making all their profits on the least responsible credit card users may not fit the changed economics.

Only one source I have read aside from this article has broached this very important topic, and that’s the always-thorough Naked Capitalism (I’m sure she had earlier comments about this subject as well but they were embedded in related posts that I wasn’t able to find right away).  The current business model relies almost entirely on the irresponsible users of credit (and probably usually least able to afford high rates) to pay the kind of premiums necessary to subsidize all the freeloaders like myself who use no or low-fee credit cards, pay zero interest, and receive rewards/points/cash back with every purchase on top of the grace period.

Sadly, as is true in all areas of business, those with the lowest product knowledge and fewest alternatives are in a poor bargaining position and tend to get it in the ass for credit card terms, and are like-wise first to suffer when the lenders feel a pinch.  (Not to say I haven’t suffered.  My favorite no-fee credit card is introducing an annual fee!  Sure, I get several times the amount of the fee back in cash for using the card every year, but I still don’t like paying the $XX.XX.  Though perhaps this isn’t the best post to bitch about that…)

The alternative business model is roughly what Yves Smith describes in the Naked Capitalism post I linked to earlier:  Annual fees for most cards, lower interest rates, and probably more strict approval standards.  Which is probably going to make the same number of people unhappy (though will at least spread the suffering somewhat).  Of course, there’s a reason why we arrived at the business model that we have currently:  Credit-worthy borrowers can take their business wherever they want, and they’ll want to keep as much of their current freeloading setup as possible.

Now for the happy ending:

“… JPMorgan has started a program that can help consumers categorize their spending and pay down their balances more quickly.

And Bank of America is promoting a line of consumer products so simple that the terms and conditions fit on one page. The BankAmericard Basic Visa, for instance, has no rewards and a single interest rate.”

Now this is fantastic news to me, and probably something that makes notorious credit-card-contract-hater Elizabeth Warren (her wiki here) very happy.

The problem as I see it in my biased eyes is that credit cards are seen as vital to modern life and so common place that card users do not bother to read their agreements.  After all, how bad could they be if everyone’s got one (or six)?  And the credit card companies do not help at all, with dense contracts written in tiny fonts with broad ‘outs’ written in that allow terms to change with little to no explanation.

I love my credit cards.  I love the features they offer.  I spend days or even weeks researching the cards that worked best for the way I intended to use them before applying for them.  And I am fine with my more feature-heavy cards coming with small books to explain the various insurances and warranty perquisites that come with them.  But I’m someone who stays up until 2am writing a 2,400-word commentary on an article about credit cards.  I may not represent the vast majority of credit card users.

Most people just have them because they think they have to, and enjoy the ease of making purchases even if they are paying a lot of interest for the right not to plan ahead and have cash available for every purchase they make.

JPM’s bit of innovation (actually present at some Canadian banks I know of already, but I am unsure if JPM’s offering is an innovation for the US market) helps remedy the budgeting issues associated with profligate credit card use (I’m sure to their advantage:  After all, it’s very likely that a service that would help pay down debts faster would focus on high interest credit card debt first, thereby reducing JPM’s exposure).

And the return of the simple no-frills card through Bank of America is exactly what we need now that a few centuries worth of history have made it clear that people are notoriously poor financial consumers and that is unlikely to ever change.  Too bad without the esteem of being platinum or gold or similarly garish, the card will likely appeal little to those irresponsible consumers who might benefit from it, but have other options.  But I suppose those with the credit scores and incomes to be able to pick and choose their cards are probably the ones BAC wants using their more complicated cards.

… and the cow goes moo

One more thought on my last post:  I wonder how many people who express such fear and contempt over the idea of rationed care are organ donors themselves?

I am, mostly to gain karma points with the Gods above who decide whether or not I should be catapulted from my motorcycle.  And those people on television are old.  I’m young and my body is pretty.  You must agree that allowing to have mine chopped up would be the greater sacrifice.

But how many of these people on TV who express outrage at the idea of granny not getting the health they deserve have signed on to have their corpses cut up to reduce the number of people dying on waiting lists?  Do they care enough to donate chunks of their soon-to-be-rotting corpse?  Or just enough to donate their outrage?

… and the cow goes moo

(this was supposed to be a more frequently-updated series; I’ve been meaning to follow-up this post for quite some time)

One of the interesting, but entirely misrepresented (intentionally at times, due to ignorance and parroting at other times) concepts considered at the center of the debate would be: RATIONING.

Rationing, triage, actively deciding who gets what, or constructing a system that makes the decision based on certain factors is a very interesting and messy topic that no one wants to talk about, but that is what rationing is.  And that is the decision afoot.

The debate, not surprisingly, revolves around the word and the negative connotations to it (ideas of poverty and government distribution) rather than the very complex matter of actual rationing.

The fact is, when someone doesn’t get the exact medical attention that they desire and could benefit them, we are looking at rationing.  And believe it or not, in Barack Obama’s America and even before it, we will have medical rationing.  Sadly, this is a statement so obvious that it rarely merits mention.  Sadder still, some people seem to be unaware of it entirely.

The entry of the term “rationing” in the health care debate has been KILLING me for the past few months, as no one seemed willing to point out the obvious that health care is rationed to a much greater degree now than should any prospective plan including a public option or insurance mandate be enacted.

Thankfully, this very obvious fact is finally making inroads, warranting mention in Jon Stewart’s unwatchable mess-of-a-debate with Betsy McCaughey (CDN link here, US here), the one informative bit of that entire 10 minute trainwreck, and getting solid treatment in this Matt Taibbi blog posting about the attractively pouty and vapid Maria Bartiromo’s interview with Congressman Anthony Weiner.

Taibbi’s post is, as usual, worth reading in its entirety but here is the segment that I hope to see more of:

“It drives me crazy when people make this argument. Fuck a fancy boutique drug like Erbitux — I have a very expensive private plan and I can’t even go to a doctor, not even to ask a simple question, unless it’s an emergency. [...] Hell, forget about paying for Erbitux, if I wanted to get a colonoscopy to find out if I needed Erbitux, I wouldn’t be able to — I’d probably have to wait until I was a fully symptomatic cancer patient before I could even have that conversation on my insurer’s dime. And I’m one of the lucky ones, I actually have money to pay for care out of pocket, if I had to. No country in the world rations care more than the U.S.”

Exactly.  Why does it take the closest thing we have to a renegade major journalist to point out that Americans don’t get all the treatment they want either!

Worse yet, uninsured (or under-insured, or simply less wealthy) Americans may be prone to skipping out on the most cost-effective care: preventive care, as Taibbi implies.

The great fear, living under an Obama regime, is that a screening system would be designed that would preclude older people from getting the best treatment available if the costs were too high to justify (by some crazy liberal metric) being spent on someone who might not live that much longer regardless of the care they receive.  Kind of like those organ waiting lists that everyone-but-Steve-Jobs is mercy to: With a finite resource such as transplant organs (as opposed to the apparently infinite resource of health care dollars), we must invest wisely.  Currently in America, organs are provided to those in greatest need, with the highest chance of benefiting (i.e. surviving the transplant and extending the quality or length of life as a result of a successful transplant).  Oh, and being “a youngish, white male with a big bank account and great health insurance” helps too, according to this article interviewing Dr. Benjamin Samstein, MD, assistant professor of surgery at Columbia University College of Physicians and Surgeons.  Of course, being youngish is less important if you’re a man of means, say $6 billion or so, who can move to Memphis to get equal treatment to locals on a much shorter waiting list than that of his actual state of residence.

Now, how horrible does applying the terms of transplant organ distribution to other forms of medical treatment sound?  As the good doctor Samstein says about organ ‘rationing’: “one of the fairest and most advanced we have for the allocation of healthcare resources here in the US.”

If politicians who support health care reform would just admit that there, of-fucking-course, will be rationing under any new system, and just explained how an imperfect system would be devised to replace our currently very imperfect system, we might be able to choose between the health care options that provide the best, you know, care.  And in an even crazier world, we could have a real debate about who Americans think deserve and don’t deserve every degree of care available.  Rather than trying to throw scary sounding words at a reform movement and hope they stick.

HEALTH CARE IS A FINITE RESOURCE, MOTHERFUCKERS!  HOLY CHRIST!

[Sorry.]

… and the cow goes moo

I guess I’m a bit late getting to this one after my bitchy/sarcastic post about The Washington Post’s for-pay brainstorming sessions (see said bitchy/sarcastic post here).

Apparently, The Atlantic Monthly (I will never feel comfortable calling it The Atlantic.  I think the body of water had the name first, so should get dibs) has a long history of such influence-peddling sessions of their own, according to Talking Points Memo.  It seems like The Washington Post hasn’t broken a story or even made a meaningful news innovation since Watergate…  Key snippet will follow, but please read the entire article.  It’s not long and touches on some of the broader reasons why these ’salons’ are held and how some journalistic integrity is maintained by The Atlantic Monthly and others:

“These aren’t one-off events, by a long shot. The Atlantic has held approximately 100 of them since 2003, according to Zachary Hooper, a spokesman for the magazine.

And they’re by and large initiated by the corporation that pays for them, according to Hooper. “The corporate sponsor” — with whom the magazine generally has a longstanding business relationship — “comes to us and says, ‘We’re interested in having a discussion on a certain topic.’” The magazine’s business staff, said Hooper, takes things from there.“

TPM was nice enough to link to a copy of the flyer so you can see what those wishing to purchase advertising time within a respected journal’s editorial get to see.  Former Massachusetts governor and one-time Presidential nominee Michael Dukakis is listed among the past attendees.  They make no mention if tank rides were included.

… and the cow goes moo

I’ve been following this story since I heard about it a couple of days ago, waiting to see how it played out.  It seemed to outrageous to warrant an immediate action.  Now that it’s had time to simmer (and boil over), it seems like we’ve arrived at an appropriate time to comment.

Please see this good quick ‘n’ dirty summary post with relevant links at your favorite econoblog, Naked Capitalism.  Politico has all the juicy parts.

I feel Edward Harrison is being a smidge unfair.  If I can  go to cafepress.com and spend $30 to have a photoshopped image of me and Gandhi tandem-JetSkiing emblazoned on a tee shirt, why can’t I pay spend a few thousands dollars for the Washington Post to customize an news article or editorial to depict an event of comparable accuracy to me and my boy Gandhi enjoying summer at the lake?

Harrison and those blabbermouth, self-righteous health care lobbyists are such prudes.

… and the cow goes moo

I have very little to say about each of these links except that it’s been a glorious week or so of online reading.  I could not bring myself to close these articles from my Firefox tabs without recording them for posterity (as self-centered as I am, it appears I believe widely-circulated articles available on the Internet cease to exist when they leave my screen).

First, from The Atlantic Monthly (yes, I still call it that):

What Makes Us Happy? – By Joshua Wolf Shenk

An excellent, beautiful in that New Yorker-sorta way interrupted (by experiment subject narratives) interview with the man that has been behind the decades-old longitudinal Grant study at Harvard.  It makes me think my Bachelors in Psychology isn’t such a scarlet letter after all.

George Vaillant, head of the study for the past 42 years tries to plumb from the disparate measurements and surveys conducted since 1937 – questions changing to reflect the interests and eras that the study has now outlived – and from the ups, downs, ups and downs again from the cohort of Harvard men the cues to living well and growing up.

The author of the article beautifully ties Vaillant’s near-theology – which often sounds little different than self-help pablum – to Vaillant’s own surprising neuroses and private scandals.  Perhaps in doing so revealing a little known property of Psychologists (and Psychology students) outside of the discipline:  Our interest in mental illness is entirely self-serving.  Physician heal thyself.

And despite the shames of the researcher and the researched, the article lifted my spirits.  The technical feat of the collection, the triumph-against-adversity of the project itself to remain fecund and funded, moreso than even the subjects, is story of a hero.  Even if the hero is a collection of bits and bytes, papers in aged folders, and punch cards stuffed away in some filing cabinet monument in Boston.

Now from Chinese finance and economics magazine, Cai Jing (don’t worry, it’s in English):

Tight Spot for Fed, Blind Spot for Investors – Andy Xie

Mr. Xie provides what seems to me a very thorough and intuitively consistent synopsis of the state of American and international investment, with a US-centricity to his analysis despite the source of the article.

He provides a good anaylsis of the various push and pull forces active in the currency, Treasury, and commodities markets, tying his observations to current action within the equity markets and providing some broad predictions that may give pause to those on the sidelines (like myself) that have been failing to decipher all the noise of the market into something that resembles language.

On Mr. Xie’s implicit recommendation, I think I’ll invest in something loud with two wheels wrapped in Pirelli Diablo Super Corsa SPs.  I think that’s what he’s saying, anyways.

And now for something completely different!

The Ninth Life of a Berkeley Boomer – John Dolan (single page view)

Mr. Dolan always writes wonderfully (though the low-rent site which I enjoy and frequent doesn’t seem to stress spellchecks) and has some especially fascinating insights into the life of the near-literati; the failed writers who became failed academics who became just plain poor.

Here he captures the story of a friend much like himself: talented, but lacking the good sense to slow his pace to stay within the proximal zone of his ‘betters’ that would ultimately judge him and decide his fate.

In its telling, he reveals the life of some of the members of the true American elite: The filthy rich and the chieftains of academia who rule their roosts.  And even to them, a smart person cannot escape subjugation by them.  And a crazy person doesn’t escape their useful purposes.

He describes a secret bit of life that I probably always lacked the talent to access, or at least the high school extracurriculars.  And my entrance essays truly sucked.

… and the cow goes moo

Here’s something I’ve been waiting to see for a long time, but never really expected to:  An investor who recently purchased a bank using TARP matching funds puts his investment in stark terms for all to see (please see Naked Capitalism’s comment, introduction, and excerpt.

Here is the key quote from the investor, included at NC, taken from The Telegraph (I believe this is NC’s source):

“The taxpayers ought to know that we are in effect receiving a subsidy. They put in 40pc of the money but get little of the equity upside,” said Mark Patterson, chairman of MatlinPatterson Advisers.”

Goddamn, that’s forthright.  It’s almost like the transaction is not just for the profit of his organization as it is as a proof of concept and example of how the TARP lends itself (or even outright encourages) abuse.

Let’s see if this catches on in American media (kind of sad that a Google search on the returns mostly blog and European news provider hits.  Where is the American media on this bold exposition?).

… and the cow goes moo

That’s the question I wish Meg Whitman and Thomas Friedman asked themselves (both links were originally found at the Exiled Online’s links/ticker).

First the biggie:

Ms. Whitman, former CEO of eBay (back when their stock used to go up), prospective future Republican Governor of California, and friend/associate/advisor to the economically unfamiliar John McCain during his 2008 campaign, apparently got a sweet little (relative to her vast personal wealth) $1.78 million kickback from Goldman Sachs for steering her company, eBay, towards GS’s services.  Kind of like a finder’s fee.  Except she worked for eBay at the time, not Goldman (see this article at the Huffington Post… which suddenly is full of titty links and coverage.  Did they always have so much NSFW content??).

So it’s perfectly understandable if GS happened to be the best contender to provide eBay investment banking services and for Whitman to steer eBay’s business Goldman’s way.  But when Goldman ‘awards’ her service to eBay (and it’s shareholders) for her choice in investment banks by providing her with inside access to profitable IPO issues (remember:  this is inside access for Ms. Whitman, not for eBay), doesn’t she ask herself if it could be a conflict of interest?

And if so, doesn’t she think to herself maybe enriching herself $1.87 million in such a — to be gentle — dubious transaction might not be worthwhile (the article indicates Ms. Whitman is worth about $1.4b.  $1.87 million is worthwhile chunk of change for anyone, but is it worth some potential lawbreaking when you already have a billion?)

Now the piddling $75,000 speaking fee for the journalist:

The New York Times’ star columnist and prolific author (and serial-metaphor mangler), Thomas Friedman, was revealed as having been paid $75,000 for a speaking engagement for the Bay Area Air Quality Management District, according to this article at the LA Times.

It is certainly understandable, given Friedman’s positions on renewable energy and his advocation of it’s role in maintaining American technological and industrial leadership, that such a group would wish to organize a presentation by Friedman.

As a journalist, does he not ask himself how this might skew his reporting when clearly the subject matter (and his advocacy) of topics can net him such extraordinary rewards?  Does he worry that may effect his writing and compromise his journalistic integrity?  And even if not, does he (and his employer) not worry that it could be perceived a possible corrupting of the purity of his reporting?  Well, apparently it did, as the $75,000 fee was returned.

These two stories have very little to do with each other, and are certainly quite apart in scale, but definitely share the post’s titular question.  And it does make me wonder why these rich and successful people don’t have an internal regulator that asks themselves what exactly they’re being paid for.

[Full disclosure:  If my employer sent me an extra $2k in my next paycheck, I probably would be quiet as a mouse.  So I'm a big, fat hypocrite.  And this is a real problem pronounced only among the rich and famous, but present probably universally:  We all think we deserve every penny we get, and more, and probably see each dollar paid to us as a dollar paid to us late and few.  This is a social problem, where we are inclined to take whatever we get rather than what we deserve, and not a susceptibility unique to the rich.]

… and the cow goes moo

The New York Times had an interesting, albeit sparce (on the good side, it’s short!) article by Floyd Norris, probably their strongest business reporter, about how some small stocks seem to be the object of manipulation by culprits unknown hiding behind internet pseudonyms, creating apparent momentum in its stock price and real profits for those who have access to the stocks at low prices, either via being shareholders while the pump is being primed, or a finance bigwig with access to special discounted share purchase agreements.

Check out the article.  I promise, it’s short.

Nothing too mind-blowing takes place as much of it I think most investors already assumed takes place regularly, but it does make me glad I don’t base any investing on share price movements I can’t explain (which is why I am a bystander for this recent rally in financial stocks).  And it makes me more wary of the convincing arguments that can be made by charts alone.

… and the cow goes moo