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German tourists are notorious for their poor clothing taste. German food is notoriously utilitarian and non aesthetic. German cars are notorious for their subtle beauty. Kia Motors hired a famous German for the aesthetic design and it really works. Korean engineering + affordable prices + German subtle style seems to be a great combination.

> German tourists are notorious for their poor clothing taste

The ones who were vacationing in Europe in the 1940's were pretty snappy dressers.

I get it! Because Nazis!

Well because of Hugo Boss, I would guess.

I really think it has to do with coloring, at least with menswear. German clothes are not any more utilitarian than American, but they have a very different palate, one that actually works pretty well with the German build and complexion.

The English have dominated menswear for the past three centuries only challenged by the Italians. Assuming that we are basing fashion on a better off high status male with a decent physique, the English, and Brooks Bros, specialize is tailoring for pasty and pink men, most American designers focus on the tanner and healthier looking, while the Italians handle the swarthier types. The French have been following England's lead on menswear since the Bastille so they don't count, which leaves the Germans and all of mitteleuropa to chunky and odd styles with strange geometries in earth tones.

Now if you are asking about ladies fashions, the Germans always specialized in cutesy, and its companion fetish gear, but the Japanese are just better at it. Anyway German women have imitated French and Italians since the days of the Caesars, why should they stop now?

Yes, the Germans have a different palette and, as other posters note, a different palate.

Didn't the Germans invent the grey uniform in WWI? Probably left a lasting impact. Also the Stahlhelm. I believe the Germans have lost the lightness of being after being responsible for two of the great 20th century's catastrophes. But why should a country of 80m be good in everything? Who is asking why the big car nation of the USA doesn't build better cars? Well, they make their money with consumer electronics. And Gerrmany makes its money with reliable engineering.

#5 Red label? Seriously? It should be illegal to call that swill "scotch".

I clicked over here from Feedly with the sole purpose of seeing if there were any thoughtful responses to #5 in the comments.

I was not disappointed.

When I tried to read #5, I got some kind of template page with no content. #1 worked fine, even though both items are from Business Insider. I noticed #1 had "uk" where #5 had "www", so I replaced one with the other in #5 and it loaded!

I don't know how widespread this problem is, but that's the fix. Replace "www" with "uk".

You would really want to walk on a better bottle of scotch? It really makes one think about the Fumi-e. I doubt Suntory would have come up with this one.

#5 Shaken not stirred.

#1 - the best part of that excellent piece was:

"Parents lend him $300,000 in startup capital."

Mitt Romney was right!

+1 - I was just about to say the same thing...great minds think alike! $300k back in those days and even now is a lot to play around with. BTW I spoke to Bezos back in those days...while I was working for others.

I disagree with #1. Jeff Bezos merely appears smart because the tech media and Wall Street have given Amazon a free pass, despite obvious problems with its business model.

Bet your beliefs

You gotta pay the troll toll...

Jeff Bezos is an idiot. Amazon is a dog's breakfast of hundreds of different lines of business, from retailing to device design, publishing to data centre infrastructure for web services. This confusing profusion of revenue streams is worse than any of the brobdingagian conglomerates of the 1970's, e.g. Transamerica or Gulf & Western, and represents the opposite of economies of scale across the enterprise-rather, its diseconomies of scope.

The company is run by an autocrat whose labour relations in its distribution centres is worse than Walmart's, and which has never made a profit. It's 'moat', in Warren Buffet's terms, is the infinite credulity of investors and dim bulb megaphone shouters like Henry Blodget.

That was delightfully dyspeptic. And, I suspect, closer to the mark than a lot of Amazon shareholders would like to think.

What chuck said: http://www.fastcompany.com/3039887/under-fire

#4
Depending on the inflation yardstick for the rich:
http://www.devilsdictionaries.com/blog/inflation-rates-for-the-rich-and-the-poor

It's always harder for the genuine poor. The stuff they buy such as shoes cost say $10 to $20 and wear out in a few months. The wealthy can spend $100 and shoes that last for years. The same for a lot of other goods.

Evidence please?

This sounds like you are saying the poor are dumb.

Not dumb, when you are on a very limited budget you have to buy the cheapest things. Unfortunately cheap things don't last. If you need evidence for this, well then you have never done it tough in your life. Well off, cossetted economists, living an easy life have very little idea of how difficult life is when there is no money and kids to look after. I know, I've gone from earning big dollars, nice house in a good neighbourhood to the bottom of the food chain. I have six kids and everything we buy is the cheapest I can get. Our old furniture would last ten or twenty years, the stuff we have now falls apart after a few years but it's all we can afford. I'm not complaining but for you to think otherwise is being disingenuous I feel.

Then the rational decision is borrowing.

What if the market rate of interest is 50% to 500% or more on that borrowing? Because that's what payday lenders often charge their customers. (Note that I'm not calling that usury nor monopoly pricing of loans; it's probably the free market rate.)

Creating and then taking advantage of the "infinite credulity of investors" would qualify as brilliance in most people's books. Lots of people try and very, very few people succeed.

“The reason that the rich were so rich, Vimes reasoned, was because they managed to spend less money.

Take boots, for example. He earned thirty-eight dollars a month plus allowances. A really good pair of leather boots cost fifty dollars. But an affordable pair of boots, which were sort of OK for a season or two and then leaked like hell when the cardboard gave out, cost about ten dollars. Those were the kind of boots Vimes always bought, and wore until the soles were so thin that he could tell where he was in Ankh-Morpork on a foggy night by the feel of the cobbles.

But the thing was that good boots lasted for years and years. A man who could afford fifty dollars had a pair of boots that'd still be keeping his feet dry in ten years' time, while the poor man who could only afford cheap boots would have spent a hundred dollars on boots in the same time and would still have wet feet.

This was the Captain Samuel Vimes 'Boots' theory of socioeconomic unfairness.”
― Terry Pratchett, Men at Arms: The Play

I was wondering when someone will bring that up. (It is there in the standard "Men at Arms" as well.)

Haha, it would be better if this were the case. There are very very many poor in the US that buy $100 shoes which wear out in a few months. But hey, the brands are cool.

It’s always harder for the genuine poor. The stuff they buy such as shoes cost say $10 to $20 and wear out in a few months. The wealthy can spend $100 and shoes that last for years. The same for a lot of other goods.
Sometimes that is true and it is less true all the time even the worst shoes today last more than a month.

Tyler, it's interesting that when you reference a piece from Cartoon Brew, you link to a ho-hum article about CG eyes instead of referencing something that's a huge deal in the animation industry: that Pixar and Ed Catmull are at the center of a wage-fixing scheme with all the major studios (http://www.cartoonbrew.com/artist-rights/new-evidence-emerges-of-wage-fixing-by-dreamworks-pixar-and-blue-sky-106529.html and http://www.cartoonbrew.com/business/pixars-ed-catmull-emerges-as-central-figure-in-the-wage-fixing-scandal-101362.html are but two examples).

It's always struck me both how many CG animators profess to be libertarians, and yet how often those same people deeply identify with the studios that treat them as fungible employees. Anyway, I'm surprised this isn't worthy of an MR link.

http://marginalrevolution.com/marginalrevolution/2014/03/the-silicon-valley-wage-suppression-conspiracy.html

I missed that back in March. Since then, quite a bit of new information has come out. Looking at that old post, Tyler is wrong about the following:

"For one thing, we don’t know how effective this monopsonistic cartel turned out to be." -- I can tell you it was very effective, and involved every major player in the industry. We now know the HR heads at all this companies had conference calls every week for years. But even before it became a formal, written agreement it operated effectively an informally.

"We do know that wages for successful employees in this sector are high and rising." -- This is demonstrably false. Yes, wages for successful animation professionals are high relative to the average job in the country, but they are low relative to the rest of the entertainment industry. More importantly, real wages have been stagnant or declined over the last 10-15 years. Relative to inflation, they have declined significantly, while work hours have steadily increased. Average pay per hour today is about 70% of what it was in 1999.

"Many a collusive agreement has fallen apart once one or two firms decide to break ranks, as they usually do." -- Straw man argument. This collusion was successful and long-standing. It went from an informal agreement during the traditional animation boom in the late '90's to the formal, highly organized version once Catmull got involved.

"One reason is that workers can find means of switching firms which do not directly implicate the new hiring firm as the villain which plucked them away." -- I know someone who got a job at Pixar when his contract with DreamWorks was up. He of course told a few friends about it. It's a very interconnected industry, and a producer at DreamWorks found out, called Pixar, and his job offer disappeared days before he was to start.

If one looks at the names of the recruiters for all these companies, you will see it's the same group for many years, and they often switch to doing the same jobs at other animation companies. Everyone knows everyone in this field. Discounting the effects of this collusion in the animation industry because things tend to be different in other industries is, well, pretty sloppy reasoning.

"The most successful collusive agreements are not usually monopsonistic and furthermore they are often based on self-sustaining and self-interested norms which do not require articulation in the form of incriminating emails." -- Both were happening here.

"You don’t need to have explicit knowledge of the workings of the cartel, rather you simply observe that other people in your general position seem to stay put rather than receiving fantastic outside offers. Given that you have outside alternatives, you would demand, and receive, higher wages in the first place for moving to one of those firms." -- This is the most humorous and ludicrous claim. In the real world of animation, you're dealing with an employee pool that is generally young and naive. I have never seen such incompetent negotiators, especially the young ones coming out of school and incredibly thrilled (despite 3-figure student loan debt) to work at a major studio. Veteran animation professionals, on the other hand, are frequently reminded that there is a long line of people graduating from animation schools who would take their job for peanuts. The reality is that the jobs are actually difficult to do well, so only a small fraction of animation school grads are capable of stepping into production roles, and those who are capable take a fair amount of training to succeed. But I've seen this treat used to get veteran animators to actually accept pay cuts while they work on films that generate hundreds of millions of dollars in revenues.

Kevin

I'm certain that Mr. Cowen possesses sufficient intellectual honesty to update his priors on this monopsonistic cartel, from his March post on Silicon Valley Wage Suppression.

Over to you, Mr. Cowen.

#4 has some interesting implications. Prices of goods in the consumption basket of the poor ("poor goods" for short) have risen *relative* to prices of goods in the wealthy's consumption basket ("rich goods"). That means that either demand for poor goods has *risen* relative to demand for rich goods or relative *supply* has decreased.

If income inequality (after taxes and transfers) had widened, then that would have been a negative relative demand shock for poor goods, which would have led to *lower* relative prices for the poor. Since relative prices increased, we can exclude negative relative demand shocks. Has income after taxes and transfers in the UK actually increased for the poor relative to the wealthy?

If not, then we need to search for negative relative *supply* shocks. The article says that the poor consumption basket is overweight energy and food. Positive energy supply shocks include fracking and offshore drilling, and positive food supply shocks include GMO foods and replacing family farms with Big Food corporate farms, which boost production. What are the negative supply shocks that would have offset these gains? More generally, if there had been more trade with low-wage countries that would have also represented a positive supply shock to cheap goods which, presumably, the poor consume disproportionately. (Again, the usual objection that trade hurts the poor on the demand side by suppressing their wages must not apply since poor goods' prices are too high, not too low. Apparently, the high prices that result from insufficient trade is a bigger problem for the poor than lower wages caused by more trade.)

So, which is it? Has the relative income of the poor actually risen or have we just not done enough fracking and offshore drilling, encouraged enough GMO and Big Food, or allowed enough trade with low-wage countries? Either way, if relative prices of poor goods have risen, then the poor face a *supply* problem, not a demand problem: there are too few goods to buy, not too few dollars or pounds to buy them with. If we really want to help the poor, then it would seem that we need to focus on growth and production rather than just increasing transfers that would be used to chase the same limited goods. Put simply, since more poor shop at Walmart than work there, the poor as a group, apparently, need more Walmarts to shop at then they need higher wages for working at Walmart.

"If income inequality (after taxes and transfers) had widened, then that would have been a negative relative demand shock for poor goods"

It seems to me that increasing inequality is likelier to *increase* the relative demand for poor goods. A small number of people at the top do better than ever, and larger numbers of people are below the mean income level.

#3 That's actually an amazing magazine! Tirole testimonies start at page 10. Check out the comment by Eric Maskin "Jean Tirole nearly ruined my teaching career" ;-)

#4
The rising cost of domestic gas and electricity was one suggested reason for the trend.

We do not so much buy gas and electricity as we buy warmth, cooling and entertainment etc. so more efficient appliances and better cheaper insulation impact on this. As far as Gasoline (petrol) we buy miles of travel, safety and comfort and so the fact that vehicles have increase their efficiency by about 1 percent per year has an impact.

I am constantly surprised by the fact that Britain had the fore-sight to avoid the Euro currency. And yet I often wonder, if Britain were also a Euro member, would the other Euro countries, and the entire currency block not be far better off with two strong economies to anchor them?

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