An Ode to a Taco Shell

Every so often you're walking along, just living your life, when WOAH! Holy crap! That's a revolutionary product!


What's so amazing about that box of taco shells? At first, I didn't notice it either. But look closer, those hard taco shells are shaped like a "U" instead of the standard "V!" Revolutionary! A hard taco shell that will stand up on it's own while you fill it with delicious taco things!

Clearly, when you're walking through the taco aisle you're not expecting an entire paradigm shift, but that's exactly what I encountered. So I bought those taco shells (I can't tell you anything about the relative pricing of the various taco shell shapes, but can you put a price on this sort of innovation?) and tonight was taco night.

Let me tell you, those shells work exactly as advertised (in that picture). They sit there calmly on your plate while you make your taco, then remain standing while you make a second taco, then remain standing while you walk to the living room, then remain standing while you eat them! Want to have a drink of apple cider midway through your taco? No problem, just set your taco down on the plate, it will remain standing.

These are the best hard taco shells I have ever have ever experienced. My taco enjoyment was at least 50% above average for a hard-shelled taco!

My only question is, why have I had to live my entire life (to this point) with on V-shaped taco shells? How could we, the human race, miss such an obvious invention for so long? I fully expect these tacos shells will add about a tenth of a percent to US productivity over the next few years. I mean, seriously, think of all the man-hours of taco-spillage clean-up that will be eliminated by U-shaped shells!

Thank you Old El Paso, your Stand 'N Stuff taco shells have rekindled my belief in gigantic food processing companies like General Mills.

Metal Spinning?

I feel that one of the primary missions of anyone with a blog is to answer questions. So it is time, once again, for me to answer a question that you did not even know you wanted to ask. Ready? So your question is:

"How do they form nearly perfect spheres (and hemispheres) out of aluminum or other metals? Shouldn't that be pretty difficult?"

The answer is metal spinning. It doesn't sound amazing, but it looks amazing when you watch metal spinning on video. That's when you realize it's totally awesome.

(Video is from Century Metal Spinning of Besenville, IL)

YouTube has an example from a metal spinning company that is making a vase:


I feel like that NBC public service program, The More You Know. Except they deal with smoking, violence prevention, HIV/AIDS, and other public health / public policy priorities, while I deal with machining metal. Actually, perhaps I should post more about machining metal to tight tolerances - it's an important subject that just does not receive much attention in our society. Children in our country really have no idea how hard it is to hold a .002" profile tolerance. Hell, given the general state of knowledge about engineering in this country, almost no one has any idea why tolerance analysis is important. No one discusses advanced manufacturing or design, I mean, did you know such a thing as water-jet machining existed?

I Participate in the Political System

South Baltimore's congressman, Johns Sarbanes, held a town hall-style meeting at the Ella Bailey Recreational Center (attached to Johnson Elementary School). Since this is literally across the street from my house, I couldn't help but to go. I'll bet you'll be shocked to learn that my roommate and I represented 50% of the people between the ages of 14 and 30. There was a very strong contingent under 15 as the event was co-hosted by the South Baltimore Youth Council, which is apparently a civic organization for kids in South Baltimore. Seems like a really cool idea, it was definitely a lot different than the sort of "get kids involved in politics" organizations you see in the suburbs. For starters, it didn't seem to be entirely run by overachieving parents.

Congressman John Sarbanes speaking at the Ella Bailey
Recreation Center in South Baltimore.

Overall, I'd say it was a pretty good event to attend. Congressman Sarbanes did a pretty good job of explaining that he was helping to advance the general Democratic platform, but that it's a slow process. He did say that he expects things to improve after the 2008 election. Overall, the main impression I got was that it's pretty hard to be a freshman congressman. In the grand scheme of things in Washington, you have almost no say in anything. At the same time, you have to explain to constituents why you aren't impeaching the administration, lowering gas prices, or helping to keep crazy men from trying to kill them. (The woman in that article showed up to ask for help to somehow get the man committed to a more secure facility. The Congressman and his staff seemed pretty concerned about that one - hopefully they're able to help the poor woman).

Wow, here's a good note, apparently they apprehended the man in question this afternoon just before the town hall meeting.

Did John Sarbanes say anything of note? He did say that while he has not signed on to Representative John Conyers's health-care reform legislation, he believes that we need universal health-care. He supports a single-payer system as the eventual end state of the reform, but he's not sure that it's a political possibility right now. His justification is that a single-payer system will remove a lot of the bureaucratic costs involved with private insurance. I can't say as I know a whole lot about how the private health insurance system operates, but I do know that I generally am not required to take a lot of action with my insurance plan. It's pretty clear what I need to do and they offer a pretty great level of service. Also, because of the choices available to me, I am able to pick a plan with a generally low level of coverage (but some coverage for catastrophic events) and pay less for insurance.

My fear with a single-payer system is that it will become a new form of wealth redistribution - the government will require healthy people to subsidize the medical care for those with chronic illnesses. Many expensive chronic illnesses are not randomly distributed, they are influenced by individual life choices. To some extent, lower health care costs are one of the benefits that one should expect to receive from exercise. This is not, however, the make or break issue for me. All insurance pools risk and has this net effect to some extent. However, with a government-run system there will be tremendous moral hazard for politicians to rig the premiums and coverage to win votes. Basically, it's very easy to imagine a system that is obligated by law to pay out far more in benefits that it receives in premiums. The system could do this because it will be backed by the federal government, it will just result in further deficit spending, which it not something that our country needs.

(Yikes! Check out all the extra taxes Conyers is proposing to fund his health care program. You need that tax revenue plus $387 billion in savings from switching from private to public insurance. Let's spell out what has to happen, you need the federal government to create a bureaucracy to provide health care not just to those privately insured, but to the uninsured as well, AND do it for $387 billion less than it costs to run the current private insurance system. Oh, and you're going to build the system, launch the system, and achieve these savings by 2010. Does that seem even remotely plausible?)

Perhaps I could support a single-payer system if it was given independent, apolitical oversight. The mission of the system would have to be to attempt to equalize the value returned to each citizen as it compares to their burden of paying into the system. I certainly don't want people not getting health care, I just don't want give short-sighted political leaders to have yet another weapon in their battle against good fiscal policy.

Anyway, back to the town hall meeting. Representative Sarbanes seemed to do a pretty good job at answering everyone's questions. Nothing that he said set off any alarm bells of terrible fiscal policy or populist economic ideas (although he did talk about "profiteering" at oil companies and saying that "supply and demand don't explain all of the price [of gas]"). In general, he did a good job of supporting the children present and seems to genuinely care about his constituents and want to help. If nothing else, I never got the feeling that he didn't want to be there, it seemed like his heart is in the right place even if I have my reservations about how he'll vote on business regulation, health care, and other economic issues.

Congressman John Sarbanes with the South Baltimore
Youth Council.

What makes me want to buy an iPhone?

It's not that it has all sorts of features, that it can browse the internet, or play music, or even make telephone calls. No, it's because they made me aware of Cansei de Ser Sexy. Cansei de Ser Sexy is the band that sings the song on the most recent iPhone commercials (the one where they keep repeating "Music is my boyfriend"). The name of that song is actually "Music is my Hot, Hot Sex." You should check out this video:



Cansei de Ser Sexy (CSS) really has everything you're looking for in an indie band. They're from a strange place (Sao Paulo, Brazil), they dress in really unattractive clothes, they can't really dance but are enthusiastic anyway, and they write songs that make you question their grasp of the English language. Best of all, they have a very ironic band name, Cansei de Ser Sexy is Portuguese for "Tired of being sexy." Apparently, that's a quote from Beyonce Knowles that this band latched onto. Considering the band, very ironic.

For examples of poor dancing:



As you may have noticed, they make a great music video. Can you really watch people dancing around like they're in an earthquake and not laugh?

Here's another awesome video:



I have to admit, I like this band in a not-completely-ironic way. I'm definitely considering buying their most recent album just based on the amount of entertainment I've derived from their videos already.

Alan Greenspan is an Inspiration

Lately, I've been reading Alan Greenspan's memoirs "The Age of Turbulence: Adventures in a New World." I've got to say, I'm surprisingly inspired by this book. Not necessarily inspired as in "This is a work on literary genius," but inspired in the "Dude, I love market capitalism" kind of way.

Alan Greenspan's memoirs reinvigorate me to become a kick-ass businessman, because I believe that business can be a force for good. A well-run, profitable, ethical business makes the world a better place. Ethical does not mean merely following the law, there is a higher moral calling that everyone in business should strive to reach. Sure, there is are elements of power-seeking and a desire for wealth (or, if we're calling a spade a spade, greed) in my motives for a career in business, but business is honestly something that I enjoy doing. I like making things happen, finding ways to solve a problem, and creating a faster, more efficient, and hopefully more elegant solution. I really love coming up with a solution that benefits both parties. I think that's why I can be good at business, because I love finding a win-win situation. When I can solve a problem that I have while creating sales or profit for a partner company, I love it.

Some people can become doctors, thank God, because I don't think I could. Some become social workers or academics, but these professions just are not for me. I think that one reason people get into these professions is to lower overall suffering and improve people's lives. Doctors do it by curing, treating, or preventing disease. Social workers have a more direct impact on the lives of families and children. Academics study esoteric problems so that no one else has to. This may seem a little hard to fathom, but part of the reason I want to be in business is to improve the general lot of humanity. This is what I find so exciting and amazing about market capitalism, it's not a zero-sum game. By pursuing my own goals, I can make the world a better place. The long-term productivity gains enabled by technological advance and implemented by mostly private actors has led us to reach living standards that our great-grandparents could never imagine.

I suppose that this what causes me to disagree with so much of what I hear from the political left (but don't get me started on why I disagree quite vehemently with the political right). I truly believe that by applying myself to market capitalism, I will contribute to the common good. It takes advantage of my innate abilities and market capitalism is not evil. More importantly, what else can I choose to do to improve the common good? It seems almost impossible to be able to choose something that will actually make a difference in the world.

But if I believe so much in business and market capitalism, how can I be employed as an engineer at a defense contractor? I'm an engineer by the fact that I like solving problems and it was an undergraduate degree that promised to teach me useful skills. I work at a defense contractor for simple economic reasons: they offered me a good job right out of college. I am still both of these things because I'm gaining some great experience. I am yet young and my career has barely begun. Also, one of the things I've learned from my work is that while there are some decidedly non-market forces in large defense contracting, private defense firms can provide a very real and worthwhile service to our nation.

In short, if anyone has ever wondered why I've made the choices I have in my life, perhaps you now have your answer. Seriously, I feel silly sometimes at how excited I get about the idea of making business deals in general. I look forward to the next XX years of my life doing business and making things happen. I suppose that there are many motivations for people who pursue the general category of "business" in the private sector. I don't claim to understand or have the ability to explain these motivations, but I can attempt to fathom my own reasons. For that reason, I hope that this post can allows some of you doctors and social workers and academics to understand in some way why a person would choose to devote themselves to private industry.

I know I haven't told you much about the book. Suffice it to say, Alan Greenspan had an amazing career and was involved in a ridiculous number of the most important economic decisions of the last 30 years. It's also a very readable book about the state of the world economy and where it may go in the next few years. Good stuff, I definitely recommend it.

Public Service Announcement

Tonight my roommate and I set out on a quest, a quest to determine "What are the two cities in America that are the hardest to fly between?" This question came up after I found that if I wanted to travel from Baltimore, MD to Liberal, KS (don't ask why I'd want to do this) I could do it in 3 stops (Detroit, Kansas City, and Great Bend) for only $316 one-way.

So then we tossed out city pairs that we thought would be difficult to travel between. I suggested Worland, WY to Bangor, ME (you can do it in 3 stops, Laramie, Denver, and Cincinnati). My roommate suggested Salisbury, MD to Nome, AK (you can do that in 3 stops, Philadelphia, Phoenix, and Anchorage). Now, Kayak.com lets you sort by number of stops, and you can certainly find stupid, stupid itineraries (for example, 5 stops from Worland to Bangor and Salisbury to Maine).

So the real question is, can you find a city pair with 4 as the minimum number of stops? To do this we actually consulted the Alaska Airlines route map. It can be very difficult to get to Wrangell, AK, but I felt like that was kind of cheating. We only picked Wrangell because it looks hard to get to on the Alaska Airlines route map. Who cares if they are one of the oldest non-native settlements in Alaska? I've never heard of them before today.

We tried a lot of other Salisbury, MD combinations. Salisbury, MD to Vladivostok, Russia (3 stops - Philadelphia, Toronto, Moscow). Salisbury, MD to Hobart, Tasmania, Australia (3 stops - Philadelphia, Los Angeles, Sidney).

Finally, we struck gold by going back to Alaska. Salisbury, MD to Barrow, AK will take you a minimum of 4 stops and 17h, 46m. The 4 stops are Philadelphia, Minneapolis-St. Paul, Anchorage, and Fairbanks. That's the best you can do.

The worst you can do from Salisbury to Barrow is 6 stops and 32h, 50m (Philadelphia, Denver, Seattle, Anchorage, Fairbanks, Prudhoe Bay). Can you imagine stopping three times in Alaska before you reached your final destination?

So now I think the challenge is to find the city pair (extra credit if it involves Salisbury, MD) that takes 4 stops minimum AND is located in the lower 48. Worland, WY to Salisbury, MD won't do it (3 stops). Dodge City, KS to Salisbury, MD won't work either (Kansas City, Indianapolis, Charlotte). Bozeman, MT to Salisbury, MD in 2 stops! (Seatle and Philadelphia). As you can see, this is quite a challenge.

Another fun question is "If there are city pairs in the lower 48 that requires 4 stops to fly between, which city pair has the minimum distance between them?"

So you might wonder why I titled this post "Public Service Announcement." It's because this is a public service, people need to know the answers to these questions. We've just answered the question of whether or not you can find two cities that take a minimum of 4 stops to fly between. Trust me, you would have asked that question eventually.


PS - In case you're curious, on the other end of the spectrum, it's impossible to find an itinerary from Baltimore to Chicago with more than 1 stop. (A partial answer to "What is the easiest city to travel to from Baltimore?")

At Least We Don't Have Wildfires

Baltimore may have a lot of problems, but at least we don't have wildfires. I work with some people out in San Diego, and the latest toll I've heard is the general manager of the plant is evacuated but doesn't know if his house survived or not and the engineering manager is just about to be evacuated from his home. Wildfires, especially in the dry brush around San Diego, are pretty scary; I never thought I'd say this, but today I'm glad I don't live in San Diego.

The San Diego Tribune has some pretty up-to-the-minute coverage. They also have a pretty awesome Goolgemap of the fires that includes some photos and addresses of the structures they know to be destroyed. So far they say that over half a million people have been evacuated and 1,300+ homes and businesses have been destroyed.

A Great Local Establishment

This post is a thank you to Pete, the owner of J&P Carryout of 1538-40 Light St. If you live in South Baltimore anywhere near J&P, you probably know Pete. He's a friendly guy, always willing to stop and have a conversation with you. Plus, he makes a damn good cheesesteak.



One of Pete's greatest business decisions was to close at 3 AM on Fridays and Saturdays, because bars in Baltimore close at 2 AM. It was just such an occasion last weekend that I happened into Pete's establishment. Now, I had just come from a marathon "Round the World" party that had lasted something like 8 hours. And I had my brand-new, extra-expensive camera with me. It had made it with me through 6 house parties and 3 bars, but the second my pizza fries were ready, my attention was elsewhere.

About half an hour later, with my late-night junk food craving sated, I prepared for bed and thought "Wait? Where's my camera?!?" I sprinted back to J&P and was lucky enough to catch one of the cooks closing up. She informed me that they were closed and I shouted in a panic "I left my camera here a little bit ago!" I could tell by the look on her face that not only did she know what I was talking about, but that they might even have my camera. Sure enough, not only had they noticed that I'd left an expensive camera in their establishment, Pete had locked the camera up in the safe, figuring that I'd be back for it in the morning.

So here's to Pete, honest and friendly proprietor of a great local business. I completely recommend them to anyone in need of some late-night snacks.

Good While it Lasted

Well folks, it was good while it lasted. From September 28th through October 5th, no one was murdered in Baltimore. That's right, for the first time in two years the city went a full week without a homicide. That ended on Friday night, as homicide number 232 was logged on Eutaw Place.

So, based on the latest information, 234 murders (as of 10/7) in 291 days is 0.8 murders/day (or 4 murders every 5 days). But from that point on, there are only 76 days left in the year, which puts us on pace for 293 to 294 murders. Sadly, that's good news, as Baltimore was widely predicted to reach 300 murders this year.

The acting police commissioner and the mayor have been jumping all over the lull in the violence (see video from WJZ story), claiming that their new policies are having an effect. Personally, I'll believe it when I see it. Actually, I lead a very charmed life for Baltimore, so I don't really see it. There's been 1 murder in my neighborhood (researched using this website) in the last two years and that was on the other side of the neighborhood at that. There are blocks in Baltimore with multiple homicides this year!

When you look at that Sun article, the most amazing thing is the list of murder-free streaks for 2006 and 2007. Twice we've gone six days, and 8 times we've gone five days. That's it, in the last 21 months, 630+ days, there have been only 11 periods of five or more days without a murder. I can't imagine what it's like living in the rougher neighborhoods of this city, imagine the stress of knowing that a shooting could take place any minute. How much longer can people live like that? What's the next step?

Return of the Blog...with Pictures!

Now that the ultimate frisbee season is over for the year, I'm looking to have some more free time to write about things. Hopefully that translates into more blog entries. I've also spent a fair amount of money and purchased a Nikon D40x, so I will hopefully have some pretty cool pictures to post as well. For now, enjoy a couple of random Baltimore scenes...



Hmmm... Blogger seems to compress these pictures quite a bit. Here are links to full resolution versions (well, they're not full resolution, I cropped and compressed some from my camera's 10 megapizel output):

Baltimore Sunset
Harborview Condo Tower

Can a Headline Tell You Anything about an Article?

Furthering Slate.com's reputation for frivolous economic analysis*, Tim Hartford asks the question "Can physics explain why poor countries remain poor?" Want to know the answer? Well you won't get it from me.

It's not that I don't want to tell you the answer, it's that the subject of the article has nothing to do with the title. Apparently a couple physicists worked with some economists to produce an abstract map of economic space to see how different goods are connected (by the assumption that because if a lot of countries that export good A and good B, then somehow it is easy to move good A production to good B production and the productions of these two goods share some sort of connection).

Tim Hartford reads a lot into this (or maybe he just reads the authors' conclusions, I'm not excited enough about their pretty picture to read their actual research article). His point is that he doesn't know what physics is.

Just kidding, his point is that perhaps resource-rich poor countries can't diversify their economies because oil is fairly disconnected and far away other things on the map of abstract economic space. I'm not convinced that this map is any proof of anything. I think you're looking at a chicken-and-the-egg situation; has this illuminated a fundamental principle of economics (that switching from a resource-gathering activity to another economic activity is too woefully complex for poor countries to manage) OR is it telling us what we already know - that most countries rich in oil are run by corrupt assholes that don't bother to diversify their economies, thus skewing the data to show that oil production is not related to anything?

So, in summary, I would say that while I don't think they've proven that physics can explain why resource-rich countries can stay poor, I do think that you could use economics to explain why two physics PhD's would do economic analysis.

* - And highlighting a new publication of frivolous economic analysis - the magazine Science! Can someone tell me how this study got published in Science? I mean, it's sciencey, sure. They totally use some scientific analysis in economics, but I can't imagine how this is so ground-breaking as to deserve to be published in such a top journal. Maybe I'm going to actually have to read this article...

EZPass for Charity

Every so often I have a great idea. One of those ideas where the light bulb really blinks on above my head and I know, I've just had a good idea. So what's the point of having a blog if you don't post your great ideas so that some day in the far future you can launch a patent lawsuit?

So, here's my idea: EZPass for Charity. It's simple, but brilliant. First, you are a charitable organization. Next, you get an EZPass reader and you set up a little gateway. Say you're a church, for example. You'd set that baby up in your parking lot, set the value of the machine to $0.25, put up a sign saying "EZPass for the Soup Kitchen" and then let it work it's magic. Maybe you get a local business to put it up in their parking lot so that it gets more traffic.

So here's why this idea is great: it'll increase charitable giving. It will be the ultimate impulse buy. "Well, I've got EZPass, and I'm already in my car...why not drive through that little gate and give $0.25 to charity?" Everyone has EZPass or the regional equivalent (ok, I don't have EZPass, but I know that I should get it) and best of all, EZPass dollars are not real money. Go ahead, ask someone with EZPass how much it costs to drive across the Susquehanna River on I-95 North. They can't tell you because they never see the cost. It gets deducted right off their credit card and it's probably small in comparison to their income, so they never notice.

This is the future of charity fund-raising. It's completely unmanned, private, operates 24 hours a day, and could even be mobile. Imagine taking this to the county fair, or Raven's stadium on game day, or getting Wal-Mart to set it up in their parking lot for the Friday after Thanksgiving.

I'm telling you, this is a great idea! Now someone go out there and build an EZPass for Charity gate and start raising money! (I won't mind if you mention that I inspired you ;)

Snap, Crackle, POP!

It's Tuesday, the 3rd of July, and I find myself relaxing in my house on a pleasant summer evening. If you live in South Baltimore, by July 3rd you've probably grown accustomed to the snap and pop of illegal fireworks. They started up a few nights ago, far enough ahead of the 4th that at first I thought I'd heard gunshots. Now, as I often complained, mine is not the lowest-crime neighborhood in Baltimore, but there certainly aren't shootings going on, so I was concerned. After a few more pops, I realized that it was summer and that those must be firecrackers.

Tonight outside my window I caught a bit of conversation between some children. A girl's voice, it couldn't have belonged to someone older than 12 or so, said "...and the po-lice, they can't even tell the difference between them and gunshots," in reference to firecrackers.

Which leads me to wonder, can she? Isn't it kind of sad that it's a possibility?

Thoughts on Prosper.com

So it's been awhile since I've published any thoughts on Prosper.com. I used to be hugely in favor of the website and the idea of person-to-person lending. Now I'm taking much more of a wait-and-see attitude. I've been through my first default (a loan that the some guy took out and then never made a payment on, I got about 1/6th of my money back at the debt sale) and now I have two loans that are Late. If both of those loans go bad, my overall performance on Prosper.com will probably lag a savings account such as ING Direct.

Not surprisingly, the missed payments and defaults have come from the lower credit grades in my portfolio. Ideally, the amount of interest that you receive from lower credit grades would make up for the increased risk of default. As you can see from Prosper.com's handy little "Estimated ROI" tool, this is not the case (scroll to the bottom of the page).

Essentially, from the lender's point of view, there are three types of people - people where you can get a much higher ROI than from a savings account (credit grades AA, A, and B), people who will give you about the same returns (C and D) and people who will not pay you back (E and HR).

Looking at those statistics is scary. Over 1 in 4 'E' credit grade loans made between June 1, 2006 and June 1, 2007 has defaulted. Since it's actually impossible for loans made between February 1, 2007 and June 1, 2007 to have already reached default, that means that 'E' grade credit is ridiculously risky. It'd be the dumbest thing you could invest money in, if it weren't for the existence of HR grade credit.

Looking at October 1, 2006 to December 1, 2006 (a period of time after Prosper.com had kind of caught on and started reaching a larger audience, but long enough ago that loans have aged a bit), only 80% of loans to 'E' grade credit are current. Based on the Estimated ROI chart from Prosper.com, in order to break-even loaning to people with 'E' credit, you'd have to get an interest rate of 36% APR.

Herein lies the true usefulness of Prosper.com from an academic/policy standpoint. Prosper.com the company does not make money from pricing credit, they make money on small transaction fees. Therefore, it is in their interest to publish as much data as they can to allow individual lenders to price loans. The side effect is that the world can see exactly how risky unsecured loans can be. Whenever policy makers see interest rates on loans reaching or exceeding 30% APR murmurs of "predatory lending" begin to become audible. However, there is growing evidence from the experience of Prosper.com lenders that there is a large population that you can not profitably loan to at rates less than 36% APR. Finally, we have a set of publicly available data that shows that the interest rates on high-rate loans are a reaction to the risk of those loans.

Actually, I should qualify that last statement. While rates on 'E' grade credit are much higher than the good grades (AA to B), over almost any period that I choose, the "Estimated ROI" based on default rates is negative for 'E' grade credit. In essence, even though the interest rates are higher, they still do not accurately price in the risk of the lowest credit grades. Prosper.com lenders are giving away huge sums of money to people with lousy credit.

In fact, if you take a look at the "Estimated ROI" tables for almost any time period you will see that if you lend to AA to B credit, you can expect a 8-9.5% ROI after fees and defaults. C and D credit are 4-7%. E credit is usually single-digit negative (-4% to -8%) and HR credit is hugely negative (-25%)!! This is not just irrational, it's downright crazy.

I think this has a lot to do with a learning curve. When Prosper.com started out there was a lot of talk about "community lending" and helping people with poor credit get back on track. There wasn't much for historical data to go on and 25% APR looks awfully attractive. Also, new lenders seem to hit Prosper.com in waves. Once the early adopters figured out that loaning to HR credit was equivalent to flushing their cash down toilet, they moved to the higher credit grades. However, many more people were just discovering Prosper.com and getting seduced by the high APR's that people with low credit scores will accept.

It's easy to see why people would get seduced. I would guess that most lenders are probably 'AA' to 'B' credit people who, upon entering into a legal contract, tend to fulfill their obligations. There is just a different mindset between 'A'' credit and 'E' credit. One would expect the market to rationalize a little and charge higher rates to 'C' and 'D' credit and stop making loans to 'E' and 'HR' credit altogether (because the 'E' and 'HR' break-even loan rates are above most states "anti-predatory lending" rate caps). Ideally you would expect the "Estimated ROI" data to converge, probably to something around 8% (seems like people feel like the unsecured loan market needs to offer at least 3% over a risk-free investment to take part at all).

So what conclusion do I reach? I'm not adding any new money to my Prosper account, but I am also not taking any money out, for now. I get enough money in payments each month to make one or two $50 loans, so I will stay involved, but less active than I had been. I will not loan to anyone with 'C' or lower for a credit score (unless I personally know the borrower and think they'll pay the loan back).

Obviously, I do feel some sort of guilt about writing off large swathes of the population as too risky for lending, but at the current going rate for their loans, it's just a losing proposition. Am I to believe that there is some inalienable right to credit access?

Still, the guilt persists. Why can't people just repay their debts or learn enough math to figure out a monthly budget? I suppose I might as well ask that no one drop out of high school or grow up in an environment that rewards illegal behavior.

I really ought to get a little more involved in some sort of community volunteering I guess. Try to explain to some children from disadvantaged backgrounds how the majority of the U.S. economy operates. But how do you actually explain to children that everything they've been told is a half-truth? How can I explain to them that the secret to financial success is delayed satisfaction, when all they see on television (probably their only access to the wider world) promotes instant gratification? I suppose that's not something you can just pronounce to a room of teenagers, it's one of those things you have to fool them into discovering themselves.

That's probably a subject for another post, perhaps I'll think of some innovative program for youth to discover compound interest and how it can affect their lives.

Virgin Atlantic Sucks (Part 4 of 4)

Today brought some good news from Virgin Atlantic. Apparently, they found my girlfriend's luggage and would deliver it. Can't complain too much about that. Unfortunately the suitcase just showed up now at 6:30 PM. I say unfortunately because she left on another flight to see visit her parents for the Fourth of July week at 4 PM.

I have to say, 48 hours to return a lost bag is not the worst record in the world, but that does not excuse the customer service that my girlfriend received over the last couple days. It's nice that they found the suitcase and returned it, but it would have been a lot nicer if they could have pretended to care about the inconvenience it caused.

Virgin Atlantic could have done some small things to make this experience a lot better. For example, offer some sort of parking voucher or pass so that I didn't have to pay an extra $8 for the hour and a half that I had to wait around in vain.

• Or offer $25 towards some clean clothes. Something that shows that this is not business as usual for your company.

• Or have some people on the phone that don't lie through their teeth to customers (my girlfriend was promised four different times that she would receive a call back within the hour - it NEVER once happened).

• How about having a manager on staff? Once the call center person actually said "Well, this call center is based in India and it's 3 AM here, so we don't have a manager." Locating your call center in India is a business decision you made, it shouldn't effect the level of service we receive. What are we supposed to do, wait until 1 AM on the east coast to call India to try to catch a manager?

• Hire more call center employees! I don't care where they are located, so long as I never hear the words "We are experiencing an abnormally high call volume." Bullshit. I'm going to just call bullshit on that recording. Call volume can't be abnormally high all the time, that's just normal call volume and you're hoping that we'll hang up and use your worthless website instead.

Overall, I'm just tired of companies trying to avoid actually interacting with their customers or meeting the needs of their customers. Especially airlines. It's as if they have completely forgotten that we are contracting a service from them, the transportation of a person and a some baggage from one point to another. If they fail to live up to their side of the contract of course we're going to be pissed.

In a world where FedEx can deliver a package to any address in the country on the next day and give me real-time tracking updates, how is it at all acceptable that airlines can completely lose a bag for 24 hours or more? We have bar codes and hand held scanners, why isn't there a system of scanning bags every time they move from one place to another?

All the things I've suggested are not incredibly difficult to implement. However, I doubt we see anything like that any time soon. As long as companies can look around the industry and say "we're not really that much worse than everyone else," there is little impetus for change. It takes guts to do your job well, to do it better than everyone else, and I don't see any airlines demonstrating that kind of will to excel. They're too busy trying to cut another inch out of the legroom in coach.

Virgin Atlantic Sucks (part 3 of ?)

As we've been told countless times by automated messages and unhelpful people that emailing this address is the fastest way to get a response. To quote the email above: "We'll write back as soon as we can, within the next 21 days."

Does this sound like an acceptable level of customer service?

When will companies learn that automated replies are more frustrating than anything? This is why I hate emailing companies, it's much easier to ignore email than a phone call.

Virgin Atlantic Sucks (part 2 of ?)

Believe it or not, no one from Virgin Atlantic called back! My girlfriend tried their baggage help number again. Once again, the person on the other end can not help her find her reference number and recommends that she send an email to customer.relations.us@fly.virgin.com.

Like I said, every step of the way it's just been "I can't help you, try this phone number instead." The people on the phone say try the internet. The website lists a phone number. Is anyone at that company able to do anything for customers?

Virgin Atlantic Sucks

My girlfriend arrived at IAD yesterday from CDG via London-Heathrow. So before she even got to Dulles customs she was pissed at Virgin Atlantic. Why? They have a one carry-on only policy, but didn't tell her this in Paris. So she arrived at Heathrow with two carry-ons. Virgin Atlantic would not even let her into the transfer area with two carry-ons (apparently they've never heard of "gate-check"). So she had to go through British customs to check one of her carry-ons.

When she arrives at Dulles, one of her checked bags never shows up. Dulles customs sucks bad enough without losing your bag. Believe it or not, this is just the beginning of how terrible Virgin Atlantic is at customer service. So she fills out the lost bag form and goes through customs.

Now, they give her an phone number for baggage services (1-800-880-6253), who of course say "It's too early to know where your bag is, give us until tomorrow." She asked to be transferred to the customer service department and is told that the Virgin Atlantic customer service department doesn't have a phone number!

She's still mad, so she wants to talk to a customer service agent. However, the Virgin Atlantic baggage office is closed and locked. We waited there for half an hour, then went upstairs to the ticket counter.

The woman at the ticket counter is entirely unhelpful. She keeps repeating that it's too early to search for her bag. No shit! We want to know if you are going to give her a couple dollars to buy some underwear and a clean T-shirt. My girlfriend remains remarkably calm in the face of such ridiculous service and asks if we can speak to a manager. We are speaking to the ticket counter manager.
-Where is the baggage manager?
-At the gate for the next departure.
-When will he or she be back?
-Probably about 8 PM (this is at 6 PM).
-Is there anyone else we can talk to?
-Try this pamphlet with phone numbers.

So I immediately dial the "Virgin Atlantic Customer Relations (US)" phone number (1-800-496-6661). You should dial it, it's an amazing exercise in futility. It takes you to a recording that tells you that "the fastest way to get a response is to use email at customer.relations.us@fly.virgin.com" After that it tells you that you can mail them at Virgin Atlantic Airways 501 W. Fort Ave. PM Box 331 Norwalk, CT 06851 or fax them at 866-258-0951. Then it asks if you would like to repeat the message. If you don't repeat the message, it hangs up. It is literally impossible to speak to a live person who works for Virgin Atlantic customer service.

I try to explain this to the manager at the ticket counter. She says, I'm not kidding, "Are you sure? There's a lot of numbers on that sheet." My other choices are all international phone numbers.

So eventually we give up and leave the airport. Today it gets even better. My girlfriend tries to log onto their website to check on her bag. It asks for a 10 digit file number. She has no such thing. She's got a bag tag number (a British Airways tag at that, because the flight from London to Dulles was actually BA) and a Virgin Atlantic Property Irregularity Report number (6 digits).

She calls them twice more, each time the person asks for the file reference number and can't help her without it. So she tried explaining to them that she doesn't have one and could they please give her that number so she can check online and stop calling? The guy says that he'll call her back in an hour. That was at 10:35 AM. As I type this, it's 11:05 AM.

Given everything above, what is the likelihood that Virgin Atlantic will call back? They've got 30 minutes.

Moral of the story - Don't fly Virgin Atlantic, they could honestly care less about customer service.

Challenge to Virgin Atlantic - If you as a company ever discover this post and feel that it does not properly represent how you "put customer service and commitment to our passengers at the heart of what [you] do,"* then you should:

1. Create a comment on this post to justify why on earth a company that cares at all about it customers would have a customer service department that can never be reached by phone.
2. Admit and apologize for the behavior of your company. At every step of the process anyone that we have interacted with has said "Have you tried waiting and then using the internet instead of calling us?" Here's a hint for all companies - that's the worst possible thing to say to someone who's just been on hold for five minutes!

Here's an update - 11:17 AM, still no call back.


* - Source: http://www.virgin-atlantic.com/en/us/customerrelations/index.jsp

Miracles of Science

I just read an incredible article on the most recent research into the origins of the AIDS virus. Sometimes, I really feel like I'm living in the future. Like when I read that they recreated an extinct virus by finding pieces of the virus that are carried over as junk DNA in different primates, then putting in all together in a new shell that can only replicate once. Seriously, wow!

I have my cake, yes, but I'd like to eat it too

Ah, politics. It's the sort of thing that will allow a man to say nearly anything, regardless of whether or not it's worth hearing. For example, Senator Sam Brownback tries to play both sides of the theory of evolution. In a nationally televised debate, he raises his hand to say he doesn't believe in evolution, thus satisfying a large constituency of religious conservatives. But, just to be clear here, he writes an editorial in the New York Times (where he must feel invisible to the religious wing of the party) where he clarifies his view to show he actuals accepts scientific principles.

Or rather, that he would like to accept scientific principles if it will win him moderate votes. It turns out that Senator Brownback comes from the "I believe in evolution, but I believe that there was a divine hand guiding the development of man" camp. This is a popular place to live, I think a lot of Americans are in this camp. It's a great place for politicians, because basically you're saying nothing. It's certainly does not allow you to call yourself a man of science and reason, because in science you can't just draw a box, write "miracle happens," and then continue on in your process. You're also clearly not a man of faith, or at least, not any mainstream faith. Sure, a number of churches will endorse you as a candidate in the US with that platform, but you're really not a believer in their doctrines. Why say something that means nothing? Because, no one will make fun of you for how dumb you sound if other people sound dumber.

Essentially, The Onion satires Senator Brownback's position perfectly: I believe that random chance could create ridiculously complex organisms, but clearly God had to intervene to make a very small change. The funny thing is, they published their article a day earlier.

I'd love to see a national politician that was actually some sort of real scientist or engineer and willing to take a strong stance for evolution and science in general. Maybe it will even happen in my lifetime.

2007 Lacrosse Champions!

I just returned from watching JHU win the NCAA Division I lacrosse championship game over Duke at M&T Bank Stadium. Hopkins played a great game, just handing it to Duke in the first half. Hopkins was up 10-4 at halftime and Duke was wandering around trying to figure out how it happened (hint: their goalie played like crap). Duke put on a pretty good run in the second half, eventually tying it at 11's before Hopkins scored in the last four minutes and then held off Duke for the rest of the game.

The last two minutes of defense from Hopkins was brilliant. They even had to play a full 1:00 of man-down defense, the goalie had some great saves, they just did not let Duke score by force of will alone. Really incredible, gutsy defense, the kind that wins championships. It was an exciting game and it was awesome to be present when your alma mater wins a national championship, I'm really glad I could be there.

On the other hand, it's a shame that the national sports media is acting so disappointed with the outcome. Just because the rape allegations against Duke players turned out to false doesn't mean that they are stand-up guys. But you read that AP article (the link above) and it's completely written from the standpoint of "look at this poor guys trying to have a come-back season after last year and mean ol' Johns Hopkins had the nerve to beat them." Come on, Hopkins was the underdog here. We were the #3 seed in the tournament, coaches polls at the end of the season had us as #5, Hopkins did a hell of a job getting to the championship game and upsetting Duke, the #1 seed. It could have been a story about the Hopkins team starting out at 4-4 and then ending the season at 13-4 with a national championship, but instead we had to hear about a bunch of guys who probably didn't sexually assault a stripper.

Why does every sporting event have to have some sort of drama behind it, why can't we just celebrate some guys playing some really good lacrosse?


PS - This is not to say that I think the JHU team is full of better guys than the Duke team. I mean, come on, half those guys probably went to high school together, they're essentially the same people. As much as I enjoy Hopkins dominating at lacrosse (hey, it's all we've got), I do admit that most lacrosse people strike me as annoying rich kids who think that they shouldn't have to follow the rules because they are a) rich and b) lacrosse players. I think it's the casual superiority that really gets to me. But whatever, at least it's fun to watch the game and my team is beyond good at it (Johns Hopkins has an all-time record of 871-272-15 in lacrosse (dating back to the 1890's), that's winning 75.8% of all games in the history of the program).

A Drug Deal

So I just witnessed my first drug deal. You might think it's funny to have lived in Baltimore for nearly 7 years and have never seen a complete drug transaction, but that was me until tonight. It's like living in Hawaii but never seeing the beach...you're surrounded by it, how could you miss it?

You might ask why I'm still awake at nearly 3 AM. Well, I had a few drinks and was reminded of a website I had stumbled upon earlier - tuckermax.com. Being that I'm drunk and the guy has some interesting stories (which I'm willing to believe are at least 50% true, the world is a terrible place), I kept reading stories. They're like car crashes, you can't look away (especially if you're drunk).

Anyway, I was about to get some sleep when I heard some voices out my window (it's hot, I'm cheap, no air conditioning yet). Peering through my blinds I see three men across the street. A skinny white guy, a kind of balding white guy and a black guy with kind of an afro. Every time a car would pass (like every 15 seconds for a bit), they would stop talking and pretend to be doing anything but transacting business (seriously, like inspecting the gutter or admiring a tree). Eventually they transacted their bullshit and all parted ways. It seemed like the drugs must have been hidden under the parked car across the street (as the black guy disappeared behind the car for a few seconds after giving the skinny white guy something).

The thing that brings this all home is that my car is parked across the street too. For all I know those fuckers are hiding drugs under my fender as well.

I love this city a lot of times. I've had some really great times here, I've got some good friends, and it's a nice, relaxed kind of place compared to like DC or NYC. But I can't stand the crime.

Does it make me a horrible person to really hate the corner boys? I mean, not just in the "I wish that they weren't around my neighborhood" kind of way but in the "I would personally be pleased if harm were to befall them." I know that it's wrong to feel that way, but they're actively working to make the world a worse place. I suppose it's some sort of primeval instinct for a man to protect his home, because as I watched that drug deal, I just wanted to beat the shit out of all the participants. All the times I've been worried about walking alone at night, all the times I've had to walk my female friends home or to their cars, for every time I've had a friend get their car broken into, I could finally see an undeniably deserving target for my anger. If only I could take a baseball bat to those assholes for what they do to the neighborhood.

But I won't. Because I don't own a baseball bat or because there are three of them and one of me. Or really because I abide by laws. Because I want to believe that I'm different from them and the only way to do that is to not sink to their level of senseless violence.

Fuck them, they're all assholes, I'm going to sleep.

Operation Kitten Calendar

Here's something you may have already heard of, seeing as how I'm pretty much never on the cutting edge of neat things on the internet, but it's fun nonetheless. Acceptable.tv posts a bunch of video clips each week and people vote on which ones are funny. At least, that's the theory. I've neither watched their TV show or voted on anything yet, but I have enjoyed freeloading and watching their videos.

So far their "hit series" of videos has been something called "Operation Kitten Calendar." I highly recommend it as a great way to waste some time on the internet. Just search their videos for that title, so far there are five ~3-minute episodes, so with Verizon DSL and my wireless router, that's like 45 minutes of fun!

Cakewalks

Awhile back my roommate and I held a cakewalk-themed party. We decided that we ought to come up with special themes for each cakewalk that we held, so we spent the night before the party thinking up clever names instead of making a shopping list for cake ingredients. It was time well spent, as we produced a fairly exhaustive list of possible cakewalks. Feel free to use any of the following themes for your future cakewalk parties.

Almost everyone one of these is a reference to a famous movie or song title/lyric, so we would recommend using that song as the music or making people do something thematic while participating in the cakewalk. (Example: everyone has to crabwalk during the Crab-cakewalk; winner receives a crab cake).

In no particular order (beyond the order that we thought of them):

• Cakewalk like an Egyptian
• Giant Steps are What You Take, Cakewalking on the Moon
• I Would Cakewalk 500 Mile
• Dead Man Cakewalking
• Cakewalk of Shame
• Cakewalker, Texas Ranger
• Random Cakewalk
• These Boots were made for Cakewalking
• Cakewalk this Way
• Intentional Cakewalk (hint: BB)
  
• Crab-cakewalk
• Paddy-cakewalk
• Cakewalk On (hint: U2)
• Cakewalk the Line
• Cakewalking in Memphis
• Cakewalk on the Wildside
• Cakewalk a Mile in my Shoes
• Cakewalk the Plank
• CakeSkywalker
• Pancakewalk Breakfast
• Hotels on Park Pl and Cakewalk
• Under the Cakewalk (hint: "we'll be having some fun")
• Cake Love, Not War
• Christopher Cakewalken
• Cakewalk on Water
• Cakewalk Off (hint: Zoolander)
• Cakeflock of Seagulls
• Let them eat Cakewalk! (the winner of this cakewalk should receive a loaf of bread)
• Candlelit dinners and long cakewalks on the beach
• Kegwalk (suitable for keg parties only)

That's probably not an exhaustive list, but it was all we could come up with...any other ideas?

Quote of the Day

I'm killing some time on the internet and I just found a really great quote in the Washington Post. The article itself is not that all interesting, I suppose it's around the tax deadline so editors feel compelled to print this sort of story. However, Shankar Vedantam lost me when he paraphrased Kim Bloomquist of the IRS:

"[Bloomquist] said the IRS plans to conduct random audits in a more systematic fashion in the future..."

Is it just me, or is that sentence screaming for some clarification?

I'm a Nerd

Whenever I get my car serviced, I write it down. I also record the mileage, because that can be important too. I happened to do this in Excel, so yesterday I was curious...what if I plotted the mileage of my car over time? Turns out it's pretty linear over the nearly 3 years that I've owned my car. In fact, it's kind of surprising how the linear regression lines up to the data. That is probably strongly influenced by the fact I'm only sampling every couple months so it ends up being dominated by my daily commute to work. I haven't really changed my commute over this time period, so I suppose I shouldn't be very surprised I drive about the same amount each day throughout the year.

Actually, you can see one big aberration that causes the linear regression to overestimate most data points - I went on an ~3,000 road trip over Christmas/New Year's last year. It doesn't make a huge impact on the average, about 2 miles per day it seems like.

Since I purchased my car, it appears that I drive 41.2 miles per day. This is obviously skewed by that road trip and a trip to Ottawa last summer; the data also shows that over periods without a long road trip I trend closer to 29 miles per day. Since I drive a pretty fuel efficient car, that's average Marylander uses like 415 gallons per year (2004 data). Some math tells me that I'm driving almost exactly 15,000 miles per year. History tells me that 32 mpg is a reasonable average for my car. That says that my car is using 470 gallons of gas per year. I could argue that for all of the long road trips (>150 miles round trip) that I've taken, I've had passengers, so they aren't all my gallons, but that's splitting hairs I guess. Wow, that puts me at the US average (~464 gallons per year (also 2004 data)).

This discovery really concerns me because I like the environment; that's why I bought a fuel efficient car! I'm going to have to try harder not to drive on the weekends (since I can't really control my need to drive to and from work). Now I'm sad, I had thought that I used less than the average amount of gasoline for an American. Turns out I'm part of the problem after all...

Some further research shows that I pay ~$86 in federal and >$100 in state taxes each year (it would be $110/year if I bought all of my gas in Maryland).

I still feel much worse about all my gasoline consumption than I do about finding out I pay an additional $200/year in taxes...and by now you know how I feel about paying taxes.

A Response to a Comment

In response to my last post, someone claimed that they disagreed with me saying that "poor=stupid." That hit me kind of hard, because that is not at all the message that I intended to get across. Perhaps I am not skilled enough writer, I seem to sometimes get carried away sometimes and over-stress certain points that screw up the overall message. Then again, maybe it is not the performer that is flawed, but the venue. Either way, I don't mean to say that all poor people and stupid or that stupid people deserve to be poor.

In fact, I don't see my viewpoint as disrespectful to low-income households; I find the paternalistic viewpoint of many activist organizations to be much more insulting to the working poor. To set a double-standard for low-wage earners and high-risk borrowers is to discount the achievements of those who work their way out of poverty. To say that great numbers of people are victims of "their socialization and education" often implies that only the middle and upper classes have free will; poor people are victims to their emotions and desires and can not be trusted to enter into financial contracts as adults.

My philosophy is that low-wage earners and high-risk borrowers are not society's J.V. squad, but an important, integral part of the economy and should be respected as full-fledged members of society. A natural conclusion is that this means they must also be held to the contracts they sign, just like anyone else. What people like that National Fair Housing Alliance are advocating amounts to a sort of "positive discrimination" in the housing market. It's still discrimination, artificially setting one group of people aside because of education, race, or income and telling lenders, "Ok, now you have to treat these people differently." Lenders will treat them differently all right, they'll probably stop making loans to them because regulations will make it much more expensive (compliance is time-consuming) and unprofitable (because they'll be forced to offer lower interest rates if the NFHA gets it's way - see this blog).

Also, my portrayal of NPR is intended to point out that while they often produce interesting news stories, sometimes the editorial bias can be a little heavy-handed. An example of this would be their coverage of Hurricane Katrina's aftermath. The typical tone of the man-on-the-street interview was "New Orleans is national icon, clearly a national treasure, and I was doing the country a great service by living New Orleans, so obviously you, the American taxpayer should buy me a new house." My favorite news stories were the ones where civil liberties groups would complain that although people were going to get checks from the government, it was taking too long to process the claims and this was somehow infringing on someone's natural rights.

My opinion is that if you live below sea level, in an area known to have the occasional hurricane, and you don't buy flood insurance, you should be grateful to get tent and one hot meal per day. If you excuse it and say "Oh, but those people are really poor and unable to properly assess the risk and couldn't afford flood insurance anyway, what can you expect?" you are only enabling further inefficient use of resources. Perhaps the fact that flood insurance is ridiculously expensive is a secret message from actuaries that there's a high likelihood of a terrible disaster in an area? If you set up a market to manage risk, then allow people to ignore risk with impunity because you've judged them unfit to make such decisions, how fair is that to people that did play by the rules? One of the assumptions in a market is that once the rules for something are set, they will not change drastically. If you live in a hurricane zone, why would you buy flood insurance? If something really bad happens you can probably get enough CNN cameras to extort some "disaster relief" money from the government.

People in areas of the country not prone to weather disasters (i.e. San Diego, Indianapolis, etc.) should be super-pissed about government-subsidized flood insurance much less hurricane relief. Government-subsidized flood insurance a wealth transfer program designed to encourage people to live near water. It masks the true cost of living in a hurricane zone or on a floodplain using money taken from people living on hills or plains.

Anyway, one more argument to address: socioeconomic background. I'm not discounting the phenomenal hurdles one must overcome if you're growing up in East or West Baltimore, but neither does it give someone in that situation carte blanche to explain away their actions. At some point, you have to say to someone from that background, "You're a human being, you have a faculty to reason not dissimilar from the population as a whole, you can no longer use your socioeconomic background to excuse your actions." I think that most non-profit, activist-type organizations agree with me that such a point exists, it's more of a debate as to where that point is located.

This all being said, I support the hell out of things education, especially things like low-cost community colleges and adult GED programs. Education changes behavior and improves your economic standing, something wealth transfers have been shown, again and again, to be unable to do.

Predatory Lending is for Schmucks

Today, one of my favorite shows on NPR thoroughly disappointed me. Typically I can count on Marketplace to be a bit of a haven, a place where you can get decent economic news on NPR. It's a pretty typical complaint, but for the most part, Morning Edition and All Things Considered have not met a net welfare reducing program they didn't like.

Announcer: "Economists argue that this program is unnecessary and will cost billions of tax dollars. However, if you ask an activist like Jim McSocialist, Chief Policy Officer of the non-partisan Union of Concerned Public Policy Majors:"

Dumbass Activist: "We're the richest country in the world and capitalism has clearly failed stupid people, so it's time to try something different. What we propose is a massive transfer of wealth."

Announcer: "Economists have a bunch of facts and figures that show this isn't a real problem, but we've got some anecdotal evidence to the contrary."

Uneducated Man/Woman on the Street: "I ain't got no education anna I gotta three kids anna I cain't affor no house."

Dumbass Activist: "The deck is just stacked against them. It's time that our lawmakers acted to reshuffle the deck."

Announcer: "Back by studies that show children living in houses outperform children living in gutters by 25% on standardized tests, activists are lobbying Congress this week to sign this bill into law."

Actually, it's not always that bad. Occasionally NPR does overcome every journalist's (apparent) natural fear of economics and do a story based on such wild ideas as "subsidies are a bad idea" or "trade makes everyone richer." Concepts that are somehow still hotly debated around this country.

Anyway...Marketplace. So today they did a story on "Predatory Lending," a trend that is sweeping the nation. (Not that predatory lending is sweeping the nation, news shows doing stories on predatory lending is spreading like wildfire). Unfortunately, they treated "Predatory Lending" like it is a thing that actually happens and that we must be vigilant to keep it bay. Very successful PR from "non-partisan" organizations has more or less convinced journalists everywhere that predatory lending exists.

I'm a bit of a skeptic. Call me crazy, but if you enter into a contract that you can not perform against, I call you an idiot, not a victim. Anti-predatory lending organizations have a great argument for this - the victims of predatory lending are uneducated or not financially literate enough to understand what they're signing. Once again, if you enter into a contract that you can not understand, I'll call you an idiot. Here's a simple idea, don't agree to things you don't understand. If you can't figure out the loan document, then don't take out the loan. The loan agent says you can afford it? Congratulations. I say you can totally jump across that shark tank. Based on the documentation I've seen of your athletic ability, you can totally do it. Go for it, your dream is attainable right now, no need to train for it, just jump!

I suppose what frustrates me about it is the assumption that contracts with dumb people are not as binding as contracts with everyone else. Somehow being uneducated or earning a low income means that you are not subject to the same rules as everyone else. You have to get special treatment, because if we don't hold your hand, you'll do something dumb.

So, I decided to find out a little about predatory lending from someone with a little less of an agenda than ACORN. According to the Department of Housing and Urban Development, predatory lending sounds a heck of a lot like plain, ol' fashioned loan fraud. Under their definition, I'm sure it exists. Mortgage brokers convincing people to overstate their incomes so that they can get a bigger fee? I'm sure it occurs.

If someone lied to you or broke a law, then it's loan fraud and they should be prosecuted. However, the idea that banks and institutions are trying to make loans that people can not afford and drive borrowers into bankruptcy seems a little ridiculous.

Finally, here's the real reason I published this post - an economist has put out an interesting paper examining payday lending and attempting to determine if it is a "predatory" practice. It's pretty approachable, I highly recommend you read it. I'll hit you with a highlight:

"Thus, higher prices are neither necessary or sufficient to conclude that a certain class of credit is predatory."

Interested? Check it out - Defining and Detecting Predatory Lending

Baltimore's Parking Problem

Last night I was riding my bicycle around the city, happily lowering my carbon footprint, when a thought struck me: "Would it kill this city to put in some bike racks?"

I was in Fells Point, which is an ideal place to bike to instead of driving (it's not too far away, there is never any parking for cars, you can walk around from place to place easily) and there was nothing to which I would secure my bicycle. Finally, I decided to go with the street lamp. If you've ever chained up a bike, you know that it can be difficult to wrap a chain around something with a 10" diameter and still get both your wheels and frame in the loop.

When I rode up to Mount Vernon (to Brewer's Art) the same thing happened...nothing to park my bike against. It's not that I'm saying there's nothing convenient and nearby, but that there's nothing at all! If it was inconvenient, then I'd still chain up against railings and street lamps, but at least it'd be my choice!

Anyway, given the traffic and (car) parking situation in much of this city, why wouldn't they encourage people to ride bikes? Could it have anything to do with all the city-owned pay-by-the-hour parking garages? I'm not sure, but I think that if they're serious about promoting Baltimore for everyone (not just the people that can afford cars and pay-by-the-hour parking), serious about helping the environment, and serious contributing to the quality of life in their neighborhoods then increased bicycle ridership is only going to help. Not everyone is going to hunt around for somewhere to lock up their bike safely if they do manage to survive Baltimore traffic. I mean, I know that I'm dreaming if I ever hope to see bike lanes on major streets here, but a few well-placed bike racks could really improve the city's image compared to other local metropolitan centers.

How Much Do You Like Free Money?

Most of the time this blog is all fun and games, but today we're going to discuss something serious: free money*. Many of you out there are going to say "I like free money," but you could be lying to yourself. Take a look at what I describe here and see what you think.

One of my favorite things in the world is interest. Why is interest so great? Because it's income that I didn't do anything to receive. All I did was NOT spend money in the past. I live within my monthly income, so every time I don't spend money it goes to some type of savings or investment. Therefore, I actually get paid for a non-action. In fact, the more I do this non-action, the more income I have. Sure, the income I make each year on interest is small, but over my lifetime I aim to change that.

So, here's how I maximize my interest each month (I get paid monthly, so that makes this a little easier):

1) Direct deposit to my ING's Direct's "Electric Orange" checking account.
2) I don't have any big bills due early in the month, so I'll transfer probably 80-90% of my paycheck to ING Direct's "Orange" savings account.
3) Time for bills - once I know what I owe and when it's due, I schedule payments (close to the due date) to be sent from my checking account.
4) Time to cover the bills - Money transfers instantaneously between ING Direct's savings and checking accounts, so I set it up to transfer the money back from savings to checking a day or two before the payment gets sent out.

"Wow," you might say, "that seems like a lot of hassle on the internet."

Yeah, it's a lot of hassle...if you HATE FREE MONEY! Look, you're already doing internet banking and online bill pay**, I'm just adding an extra step that pays a little more interest on your money. Not only that, but because I only transfer back the money I need to cover bills, it's a sneaky way to accidentally save money (as long as you spend less than you make - otherwise you have bigger problems).

How much money am I making? Well, assume that I mail my rent check on the 24th of every month. Assume that for 20 days of that month I have the month in the ING Direct Savings account (4.50%) and 4 days in the ING Electric Orange account (4.00%). For every $100 of rent, I will end up with $3.49 of interest at the end of the year. What if I only used ING Electric Orange (4.00%)? I'd end up with $3.16 (for every $100 of rent I pay) at the end of the year. That's not a lot of money, but if you look at it over time for a realistic rent for a young professional in Baltimore, you get the following graph:
One can reasonably argue that the extra $5 that you end up using my scheme for two years is not worth the hassle, but the $45 you get for using ING Direct's Electric Orange checking account is absolutely worth it. It's like there's an extra $45 sitting on the table, all you have to do is reach forward and pick it up. It's yours! All you have to do is open an interest bearing checking account.

So if you like free money (but not quite as much as me) then I recommend you do this:

1) Direct deposit to my ING's Direct's "Electric Orange" checking account.
2) Time for bills - once I know what I owe and when it's due, I schedule payments (close to the due date) to be sent from my checking account.

Finally, I am aware that I do not love free money as much as some others who have already ditched ING Direct for HSBC or some other online savings account with an even higher interest rate***. My answer to that is that I already have some ING Direct CD's, so I need to keep some sort of ING Direct presence and the 0.50% increase in interest is not enough to make me open yet another banking account. Besides, I'll admit it, I love the ING Direct website, it's just plain friendly.

So where does one get this ING Direct? If you don't already have it, let me know so that I can invite you to join. If you wait for my invitation, you'll get $25 free with an initial deposit of >$250 (and I'll get $10 if you do)!

* Ok, for those literalist economist types in the audience, I realize that this is not "free money." In order to get this money, you have to go through all the steps that I lay out above. However, many of these steps are simple, one-time tasks (opening an ING Direct account) or things you do anyway (like paying bills), so I would say that this is as close to "free money" as you are likely to find available in mass quantities.
** If you're not already doing internet banking and online bill pay, you must really, really hate free money. Checks cost money, stamps are about to go up to $0.41 each, and you end up paying way ahead of time usually. Of course, who cares if you pay ahead of time? It's not like regular banks pay interest on checking accounts. You're lucky if you're not getting hit with fees for not maintaining a "minimum balance."
*** I do have an E*Trade savings account with a 5.05% APY that I use instead of keeping cash in my E*Trade brokerage account.

Camelback

This week I was on a business trip in the Phoenix area. Not a whole lot to comment on, aside from the fact that it's shockingly hard to find a hotel room in the Phoenix area in mid-March. I was running into the problem of spring-training baseball, really spectacular weather (sunny and in the high 70's), and a couple conferences in town.

We finished up all our business by about 3:30 PM, so we hiked up Camelback Mountain near Scottsdale. Thanks to technology that keeps my cell phone out of my workplace, I can bring you these pictures from Arizona.

This is a view from the parking lot, you can't see the summit from here; beautiful scenery though.

"Hiking" is kind of a misnomer for this trail, it's actually more of a rock scramble in a lot of places. 1200 vertical feet in 1.2 miles. We're about a half-mile into the hike at this point. The next picture was taken from the peak visible in this picture.

Here's a view of Scottsdale, Arizona from the summit of Camelback Mountain.

By the way, the most impressive thing about this hike is the people who were jogging up the trail. Next time I'm out there, I'm taking some running shoes and trying it myself, probably will kick my ass, but it'll be fun to try. On the other hand, the next time I'm out there, it may well be >100 degrees, so maybe running in the desert isn't the best choice.

Certified to Observe

Last weekend I became certified as a UPA-sanctioned observer. In order to become certified I had to go through a full day of training, pass a couple tests on the rules, and get evaluated while I observed a college ultimate game. Surprisingly tough requirements actually. But now I have to say I'm now very confident in my knowledge of the new 11th edition rules.

People will ask, why do you want to become an observer? The answer is, because some day I'd like to play in an observed game. I really believe in the spirit of the game, but sometimes on the highly competitive level, poor calls can make the difference in a game. I once watched a team lose a regional championship by one point on an absolutely horrendous call that, had there been observers in the game, would have surely been overturned. So when you can't count on a player's honesty in a really important game, it's nice to have an impartial observer.

Other people will ask, what the hell is an observer? For anyone that doesn't know, ultimate frisbee is a self-refereed sport. Players call their own fouls and violations. When there is a question as to whether a receiver is in or out of bounds, it's their call (unless they defer to someone else who has a better perspective).

Eventually, as games became more and more competitive, the UPA (Ultimate Players Association, the governing body for Ultimate in the US) introduced the observer system. Observers do not make calls or stop play. Observers make active calls on in and out of bounds and generally just watch the game. If a player makes a call, the normal rules apply. They try to work it out on the field. If the call on the field does not satisfy the players involved in the infraction, they can appeal to the observer to make a ruling. Only then will the observer say anything about their opinion on the matter. What if the observer can't be sure of what happened? If neither observer (they usually work in two-person crews) feels comfortable making a decision, then the rules call for a "Do-Over." That's right, the technical term is "Do-Over."

I have to say, I really like the system. Many ultimate players do not like the idea of observers, we're a self-refereed sport and we're proud of it. That's what makes us different, we keep things civil on the field not because some arbitrary authority figure says so, but because we really believe in good sportsmanship. However, after observing some games, I have to say, there are some real advantages to having observers in a game. First of all, we keep time limits, forcing teams to keep the game moving between points. Secondly, the teams we observed were very civil. I think I actually ruled on two contentious calls in the four games I observed (and I saw the semi-final and final of a large college tournament). In the second instance, the thrower called a foul and the marker contested the foul call. The thrower turned to me for a ruling and by the time I could say anything, the marker's team had intervened from the sidelines and talked him out of contesting the call.

All in all, a great compromise. Observers give you the opportunity to show that you are a spirited player, but for the occasional asshole who will try to take advantage of the rules, observers can help keep them in line. Don't get me started on people who take advantage of rules in unobserved games, you can't publish what I think of them. Who cheats in a self-refereed sport? It really speaks to your character when you intentionally foul to gain an advantage. That doesn't make you a good defender, it makes you worthless cheater.

The final observation on becoming an observer? It certainly helps to have some experience in the sport. My roommate and I both became certified last weekend and we agreed that people certainly afforded us some respect since we clearly know what's going on in the game (that, and we have a sense of humor). On the other hand, I also support people with less experience getting the observer training. If nothing else, you will really learn the rules of the sport you play.

PS - I think I'm a big fan of the 11th edition. I love the addition of the "disc space" call, now all these hot shot defenders who run up and hump your leg are going to have to learn how to really mark. I'm not sure that I'm a huge fan of the new "super-continuation," but we'll see how that plays out.

Let's Hear it for the Letter "Y"

The Wall Street Journal ran a recap of a an article in BusinessWeek about women facing a much higher rate of inflation than men. It's an interesting idea, instead of lumping price data for all consumer goods, break it out by the gender of the likely consumer. On the other hand, a study like this is really no better than its assumptions (how are "auto parts and repairs" strictly male consumer goods?), so we probably ought not read too much into this report.