Welcome to the 53rd edition of the Carnival of the Capitalists! Today we celebrate the beginning of our second year. The Cotc was a product of some discussions Jay Solo and I had about the growth in good business blogs and the difficulty reading them all. We wanted to do a weekly summary and tossed around names for a few days until Jay came up with Carnival of the Capitalists. We wondered at the time if we would even make it to one year, but there continues to be plenty of interest and it has served its purpose well. For those of you wondering what that purpose may be, I'll past something from my original post on it:
We have several goals with the Carnival of the Capitalists. First off, to provide a good summary of the best posts to those who don't read business blogs every day. Secondly, to allow readers to try out a new blog by reading that blog's best post of the week, instead of on some random day when maybe the material isn't as interesting. Lastly, to encourage more and better business writing by those
who participate.
Before we get started, I'd just like to thank Jay for all his hard work over the last year. He is really the go-to guy for this thing. He maintains the homepage and updates the links when needed. If it had all been on my shoulders it probably would have died out after three months. While I'm at it, I want to thank Drakeview as well for compiling some statistics last week. Very interest stuff.
One more thing before we get started. Several people asked if this was going to be a "best of" week where everyone submitted their best Cotc post of the last year. I thought about that and will leave it out there for any host who would like to try it. But for now I figured I'd keep it fresh.
Now, here are the entries for this week…
EconomicsBarry Ritholtz from The Big Picture starts us off with this post on the employment situation.
After the September Jobs numbers came out, we mentioned that drilling beneath the headline numbers sometimes reveals structural problems in the labor market which might be overlooked.
This is no big surprise — we have continually commented that in a post-bubble environment, Economists err when they apply
the usual presumptions about typical recession/recovery cycles. This environment is the exception to the usual rules . . .That is my best guess as to why the dismal scientists have been so wrong by so much for so long.
Brian Gongol discusses the urgent case for growth in this country.
When Roosevelt delivered his address to the Hamilton Club of Chicago, the United States was on the verge of eclipsing the United Kingdom in terms of per-capita gross domestic product (GDP).
Effectively, the United States was in the process of emerging as the world's most powerful economy. The ensuing century was undoubtedly one of American economic dominance, a carriage drawn by the horses of technological innovation and private-sector growth.
But sic transit gloria mundi: As of 2004, the economic growth rate of the United States was in a long-term holding pattern around 2%. Meanwhile, China has been operating at a per-capita growth GDP growth rate of more than 8%.
Tex the Pontificator analyzes Bush's remarks on Canadian pharmaceuticals.
That is a cop-out, and I am disappointed that the president failed to give an intellectually honest answer. The issue involves a basic principle of economics, but if nobody ever explains it forthrightly to the American people, the issue will never be resolved properly. If lack of safety were the only problem with importing drugs from Canada, they would have been imported long ago. Why could not the president have given the following answer?
Chuck from You Big Mouth You blogs about China's Economy.
China, Communist China, is currently consuming a vast amount of the natural resources of this planet. Were it not a centralized, neo-socialist dictatorship I might be applauding this productivity. Instead, I am very concerned.
The cites below demonstrate that China's demand for resources is driving commodity prices higher and higher. The downfall is obvious. When China is no longer able to float its economy of the back of the trade deficit with the United States, prices will collapse and the world economy will go in to a tailspin. China is creating its own tulip bulb depression by forcing value onto commodities that the ordinary market does not support.
Phil from The Speculist writes about economics, explaining it to his daughter in a political context.
I had a lively debate with my 15-year-old daughter this morning while driving her to the orthodontist. Initially, we were on the subject of the presidential race. She expressed a certain disdain for both candidates, complaining that Bush is "such a Republican" and Kerry "such a Democrat." As a registered Independent, I can sympathize with that reaction (even if I wasn't sure exactly what she meant.)
The Picket Line writes that maybe there is such thing as a "free lunch," if you are a Freegan.
Yesterday I pointed out Claire Wolfe's criticism of "jobs" and of working for a living. Wolfe promises us some follow-up articles exploring what the alternatives are to making a living and paying the bills by holding down a "job," and I'm very much looking forward to those.
When people hear someone sounding like they believe work and jobs ought to be eradicated like smallpox and polio, they often roll their eyes and explain patiently that you've got to work, since "there ain't no such thing as a free lunch."
Interested Participant discusses U.S. unemployment and compares it to rates in other countries.
In the next debate between candidates Kerry and Bush, unemployment in the United States will be a point of sharp disagreement. President Bush will state that many jobs were lost due to uncontrollable circumstances in the economy, however, the trend in job growth is positive, sustained, and substantial. John Kerry will state that people in Ohio,Pennsylvania, and Michigan are suffering from lost jobs while quoting an abundance of statistics. Since raw data can be misleading, it's important to place statistics in context.
Steve Verdon has what may be the shortest cotc entry yet, claiming that the economy will be sluggish for the near future.
Aunty Goob discusses capitalist weaponry, and introduces capitalism to the UN's oil for food program.
Let's get capitalism back into the equation here. Obviously, monetizing any commodity cheapens it. UNSCAM came about because it's so easy to launder money through vouchers and the like, doctoring documents as necessary and easily obtaining the UN's approval, imprimatur and blessing. If there's to be an oil for food program, make it a direct trade. Want water? At one dollar per bottled pint, that's 50 pints or 6.25 gallons of bottled
water per barrel of oil.
Sic Sequitur writes about free trade in textiles.
Trade in textiles stayed outside the WTO framework for decades, governed by discriminatory quota systems such as the Multifibre Arrangement (MFA) and the previous Long Term Cotton Arrangement. Only in 1994 did the Uruguay Round of trade liberalization talks address textile trade. The Agreement on Textiles and Clothing (ATC) set out a ten year program of trade barrier reductions culminating in a full transition to WTO rules in the textile trade on January 1, 2005.
Legend Games has a submitted a post called Economic Education and Global Revolution, which has some interesting ideas about educating kids in a capitalist culture.
People on the low end of the economic totem pole – the Sears clerks, the delivery boys, the Mexicans working hard in the factories for $5 an hour – any worker on the mucky end of the stick – should probably be thought of as ready to revolt at any time if not for two mitigating factors.
Those factors would be a) the reasonably-often-satisfied hope that step-on-the-ladder economic progress would come for those who work hard, and b) the expectation that the brilliant or the lucky could jump to the top. We might encapsulate these promises as "functionality" and "freedom" – the system will work for you if you work for it, and if you can get ahead on your own hook, God bless ya.
Arnold Kling argues that people are living longer and consuming more health care, thus we need to save more.
Suppose that 50 years ago the expectation for a 45-year-old man was that he would live to age 70, and that health care costs would be, in today's
terms, $1000 per year after retirement, at age 65. Today, a 45-year-old man might expect to live to age 85, with health care costs averaging $10,000 per year. Assume that other post-retirement living expenses are $30,000 per year. The total post-retirement expenses are compared in the table below…
He follows up with a request for policies that would encourage thrift, so go leave your answer in his comments section.
Ian from Truck and Barter notes that the vaccination shortage just might have something to do with the U.S. government purchasing the vaccine at a forced discount.
If you have any faith at all in the notion of supply and demand, wouldn't it seem reasonable to think that that at least one of the companies that produces vaccines would see this cycle, and start gearing up production around summertime every year? The demand is certainly there; the government has moved into talk of rationing, fer cryin' out loud. Yet, here we are again.
Ashish wants to know if Iraq and Afghanistan in 50 years will look like Korea does now.InvestingFrom a new blog, Resource Investor, we get an interesting post about the current gold bull cycle.
The gold industry is about to complete its fourteenth quarter in the current gold bull cycle. At the start of the cycle conventional wisdom predicted that nimble intermediate miners with unhedged gold production would handsomely outperform the lumbering mega producers, especially those with ounces sold forward.
David from Seeking Alpha tells us about the sweet spot in technology investing.
Most technology investors focus on tech companies that sell to enterprises. The enterprise market, particularly if you include small businesses, is far larger than the consumer market. Companies' technology budgets are significantly greater than consumers', and enterprise-oriented technology has evolved more rapidly than consumer-oriented technology.
EntrepreneurshipTravis from Odyssey of the Mind submits a two part series. The First Part talks about his struggle with entrepreneurship vs. taking a job right out of college. The Second Part contains responses from several people around the blogosphere. To add my own $.02, I think it is easier financially if you have been in the corporate world for a while. A real job, a house and a good stable credit history will be looked favorably upon. But be careful about getting too comfy or you will never go back and take that leap to starting your own business.
Jeff Cornwall sends a submission about the new generation of techie
entrepreneurs.
I am proud to say that none of the students who studied with me in the late 1990s fell into the get-rich-quick scheme that was known as the dot.com craze. My students knew that my view of true entrepreneurship was that it was not just a mechanism to feed off of greed and raise a bunch of money that had no real purpose just because you
could.
MicroIsv tells us that the money is in the niche for software
developers.
The biggest opportunities for micro ISV's today exist in finding a niche that isn't being filled by one of the big software companies. The best part is that many of these companies are betting that you'll do exactly that.
MarketingDave from PhotonCourier writes about the marketing of the new hybrid Honda Accord.
In December, Honda will launch a hybrid Accord which gets better performance than the standard Accord. It's got a 0-60 time of 6.5 seconds, which, according to Business Week (10/18), is a full second better than the standard time (although MSNBC quotes the difference at a half second rather than a full second.) Fuel economy, according to the MSNBC article, is up 43% in the city, 23% on the highway. Part of the efficiency improvement comes from what Honda calls Variable Cylinder Management, which means that 3 of the 6 cylinders are shut off when the power is not needed (when you're going downhill, for example.)
Giselle says to sell yourself, but not shortly.
A theory is being tossed about that being heard, more than being seen, is an effective means to penetrate the market. In our online word, being heard is not so much the actual auditory experience of having a symphony of notes and decibels entering our ears, as it is having verbs and axioms playing in our mind. It is in a way hearing mentally. How best can you be heard then, than through words?
Words would be your best tool to break into the market and pull customer attention to you, your site specifically. Choose them wisely to make them realize that you have what they want.
Crosshairs is making the point that direct mail isn't necessarily junk mail.
Last night, I was talking with my girlfriend about direct marketing. She made a joke about telling people that I was in "junk mail." I shrugged off the comment at the time but it keeps resurfacing in my thoughts.
I don't like the term "junk mail". I've been trying all day to put my finger on why it bugs me so much. Basically, I believe it's because people simply don't understand. In other words, ignorance of marketing, direct marketing, and their role in the capitalistic society we live in.
Director Mitch has a post about selling coffee in a world of tea.
Do you remember your first time at a Starbucks? For me it was 1989 when a friend took me to one in Chicago right off Lake Shore Drive. I never heard of the place before, but they had these various coffee drinks that my
friend had to explain to me: latte, cappuccino, Americano. Of course I had heard of these drinks before, I just didn't know that the difference was between them since I had never had one.Fast forward 15 years and there isn't anyone in the U.S. who doesn't know what a cappacino, latte, or decaf, low-fat, one-pump, no-foam mocha is. The U.S. really has become a coffee culture, inventing whole new drinks like frappacinos.
Wayne from Blog Business World discusses blogs and public
relations.
As competition for available media coverage tightens, in a sea of press releases and attention stealing publicity stunts, it is harder than ever for a business to gain much needed publicity. A business person is often at a complete loss as to how to get media coverage of a worthwhile business story.
Getting someone to hear the message is half the battle. Having the members of the media consider it newsworthy is the other half. Somewhere, there must be another vehicle, that can gain the attention, of an already swamped news editor. That help, for the publicity seeking business person has arrived, in the form of the blog.
BusinessProfessor Bainbridge has a good post about corporate governance and the Ovitz lawsuit.
Last week's host, Drakeview writes about women CEOs and stock price.
Peggy M. Lee, Emory University, Goizueta Business School and Erika Hayes James, University of Virginia, Darden School of Business Administration have recently published scholarship exploring the elevation of women to CEO ranks in publicly held companies.
The study showed there was a significant, immediate, brief, negative impact on share price to these announcements. The authors reviewed 1500+ announcements of firms that made changes within senior ranks from 1990 – 2000.
Small Business Trends sends a post about smart partnering.
Even as many Floridians were fleeing their homes to avoid Hurricane Frances, their *neighbors* in Florida and Georgia had a small way to support them, just as they did after Hurricane Charley and tropical storm Bonnie hit. When people visited a Winn-Dixie grocery store they could help towards storm relief by "evening it up" at the checkout counter. That is, they could round up their food bill to the next dollar, with the extra change going to the local Red Cross chapter for relief efforts.
This isn't a random event. It reflects a growing trend of organizations joining forces with others who serve the same kind of consumer. Together, they have discovered that they can act quickly to offer extra value, convenience or other stand-out
benefit.
Small Business CEO decided to wait until the one year anniversary for his first Cotc submission. Here it is, a nice post about why customer service is so important, and what it is customers are looking for.
In challenging economic times some businesses cut costs by cutting corners on their customer service. That is exactly the wrong
thing to do. In tough economic times, how we serve our clients is more important than ever. Here is why…
Anthony Cerminaro writes about buying and selling a business.
The purchase of a residence may be the single largest transaction in which most individuals will ever be involved. For an entrepreneur or small business owner a similar statement can be made about the buying or selling of a business. In short, it is often the deal of a lifetime.
Frank Scavo discusses key success factors in ERP implementation, based on a mini-case study of a mid-size manufacturing firm, Cascade Designs. He finds that success depends less on technology and more on paying close attention to business processes and user adoption.
Yesterday afternoon, PeopleSoft arranged for me to interview Ken Meidell, CIO at Cascade Designs, an early adopter of PeopleSoft's Enterprise One system. But, as it turns out, the interview interesting for me more in terms of implementation lessons learned than it was in terms of learning more about PeopleSoft's software.
Coyote Blog asks, is the Department of Labor fair?
Over the past several years, we have been audited a couple of times by the Department of Labor (DOL).
One of the audits was standard procedure (as a concessionaire to the US Forest Service, audits are sometimes required on certain contracts) and one was based on employee complaints. It never ceases to amaze me that some folks never even bother to call our HQ to complain and try to get it paycheck mistakes fixed — they go straight to the government rather than our labor department if something looks wrong on their check.
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Blog Jones answers the question that drove Robert Pirsig crazy. What is quality?
ManagementLisa from Management Craft discusses management capacity as a strategic issue.
Should a company's strategic plan address their management capacity? You betcha! One of the best predictors of whether and how well and strategy will be implemented is the strength and abilities of the management team. How important is this? A mediocre strategy, executed well, will often outproduce a brilliant strategy that is poorly executed.
MiscellaneousThe RFID Weblog discusses the role out of MasterCard's new contactless pay system.
MasterCard says that its new RFID-based payment system, called PayPass, is headed toward a roll-out nationally in the U.S. But the roll-out will be in stages on a market-by-market basis. It already has been piloted in local markets in Florida and Texas.
This post from Catallarchy discusses the evolution of porn file names, which is a process that has lots of economic applications.
Mobile Techonology Weblog writes about the cellphone market and how many young kids are getting cellphones.
Giving your child a mobile phone seems an increasingly popular concept these days. In the US, for instance, 200,000 kids aged 5 – 9 have mobiles and according to Mobile Youth, this is expected to double within 2
years.
Martin Lindeskog will be "learning at work" by taking part in an interesting project at a manufacturing company in "New Europe."
This post from Layman's Logic didn't seem to fit anywhere, but does discuss how one man turned a problem into a business.
I'm not quite sure what the libertarians will have to say about this. But the Times reports that people are starting to knock out home-made speed cameras to regulate speeding outside their home
If you want to read the first edition, it can be found here. Next week's edition will be hosted by Jay, so send entries to cotcmail-at-gmail-dot-com before next Sunday evening.
Have a great week!
