Thursday, October 13, 2011

Buried in Student Loans? Nontrepreneurism 2c CNBC Bails on OWS

Lori Spechler Senior Editor CNBC "Op-Ed: Buried in Student Loans? Don't Blame the Banks"
"The cost of college is also the result of a culture that has accepted it as “the” best way to get ahead—we are not all Bill Gates. And high school has become a four-year sprint to get into the best college or university that money can buy. I get that, I am living it—early decision, SAT tutors, the full catastrophe is playing out again in my household. There are certainly reasons that we buy into the dream.
But at the end of the day, it should all boil down to one simple question: can you afford it? Is that fair? I don’t know but, it’s the way it is—I applaud any effort to change the system, but once you bought a ticket, please don’t ask me to foot the bill, I’m still paying for your house."
Bottom Line: 
This was on CNBC --  CNBC!
Dandy Don would be singing in the background. 


Tuesday, October 11, 2011

Nontrepreneurism Part 2a Forgiving Student Loans

Richard Vedder of National Review Online does not mince words: Forgive Student Loans?
"Who would take the loss from the unanticipated non-repayment of a trillion dollars? If private financial institutions are liable for some of it, it could kill them, triggering another financial crisis. If the federal government shoulders the entire burden, we are adding a trillion or so more dollars in liabilities to a government already grievously overextended (upwards of $100 trillion in liabilities counting Medicare, Social Security, and the national debt), almost certainly leading to more debt downgrades, which could trigger investor panic.
This idea is breathtaking in terms of its naïveté and stupidity. The demonstrators say that selfish plutocrats are ruining our economy and creating an unjust society. Rather, a group of predominantly rather spoiled and coddled young persons, long favored and subsidized by the American taxpayer, are complaining that society has not given them enough — they want the taxpayer to foot the bill for their years of limited learning and heavy partying while in college. Hopefully, this burst of dimwittery should not pass muster even in our often dysfunctional Congress."
Of course, I am not cruel or inflexible: 

  1. Did you actually graduate college? (After year 2006?)
  2. Did you (or your immediate family) pay at least 51% of your tuition?
  3. Have you been current on each and every monthly loan payment, for a time period equal to the time you were in school? (Example: 5 years to graduate = 60 months of consecutive payments.)
  4. Are you currently working at a job that leverages your degree? (A very flexible definition.)

OK... Loan Dismissed
A big chunk of Student Loan debt, whether performing or not, belongs to the government anyway, and we, collectively, are the government, so this is a "cost" that we should be willing to pay.

Bottom Line: 
Let's hope that Vedder is correct about how our Congress might react. 

Doing the right thing (meeting your commitments/obligations) should be rewarded.

Monday, October 10, 2011

Water Rates, the 4-Rs of Nontrepreneurism

Water Rates, the 4-Rs of Nontrepreneurism

Community Impact writes about the 4-Rs: Water Rate Raise Rankles Residents as Monarch Utilities - which operates Windermere Utilities a subsidiary of Southwest Water Company files for a (huge, and poorly designed) rate increase for Pflugerville.
"Monarch’s response 
 "Hayes said the reason for the rate increase is the nearly $70 million in investments Monarch has made over the past five years to tap new water sources, replace meters and replace aging water and wastewater treatment plants. “Our sizable investment across the state means our costs are significantly higher and can no longer be sustained by the current rates,” Hayes said.  
She said Monarch has made several improvements specifically to Pflugerville’s water services, including a new, elevated storage tank and improvements to an ultraviolet disinfection system at the Windermere wastewater plant. “Monarch has invested millions of dollars on improvements throughout our combined systems to address enforcement actions against the company by the Texas Commission on Environmental Quality (TCEQ),” Hayes wrote in a statement." 
So, a government agency (TCEQ) enforces the rules against Monarch. Monarch then "invests" in improvements to get into compliance, and the residents get the bill. 

Monarch should have applied for rate increases before their "investments", so that the community would have time to review their plans. 

Bottom Line: 

Let them (Monarch) eat cake. Don't spend money that you don't have then demand to be bailed out - that is Nontrepreneurism at its' worst.

It smells like raw sewage to me.

Nontrepreneur, Meet Entrepreneur: Griffin Technology

Nontrepreneur, Meet Entrepreneur: Griffin Technology

If the Nontrepreneurial vision is to redistribute wealth, to take from one group and give to another via Government intervention, to create false value by invoking fairness... where are signs of American Entrepreneurship? I found one: Griffin Technology (Nashville, TN!). 

(Nontrepreneurism: Part 1, Part 2, Part 3, Part 4, Part 5)

The Problem

In the summer of 2010 a good friend and I struggled with the costs and logistics of putting together a mobile computer lab. We wanted to present computer basics and job hunting skills to a novice user group of 8-10 students. 

The Dell Mobile Computing Station is an elegant, if slightly expensive answer. The cart plus 10 Netbooks, software, and class leader tools would push this solution well over $10,000 - before software. 

Windows Drawbacks

Windows does require a certain amount of hands-on support, the end user audience would need ramp up time on basic functionality, and portability would entire a van or big SUV to take to/from class. 

Why iPad + Griffin Technology Multidock?

Griffin Technology counters the Dell offering with a simple, well designed solution. Their Multidock, plus 10 iPads, plus leader tools, would cost out well under $10,000. Support costs for an iPad... practically none. End user orientation time on an iPad... practically none. Applications... plenty, and free apps/tools for most anything. 

I bet every first grader would be able to understand how this classroom solution would work.

iPad Drawbacks?

For business level documents (resume, cover letters, etc.) the user input to the iPad is a bit of a problem. Bluetooth keyboards start to remove the cost advantage. But, once those original documents are created, most online tools are tablet friendly. LinkedIn, Facebook, Twitter and other key resources are tablet ready. 

Bottom line: 

There is not a single government agency that could have built a solution as brilliant as this solution created by Griffin Technology

Now, to find a few sponsors to get this idea into reality.  

Android - Top 11 Apps from CIO,com and 1 still MIIA

Android - Top 11 Apps from CIO,com and 1 still MIA posts a slideshow of the 11 Best Android Tablet Apps for Newbies

Kindle, Pandora, Amazon Appstore for Android, Google+ for Android, Poynt for Android (powered by CitySearch), Amazon MP3 and Cloud Drive for Android, Twitter for Android, ScoreMobile for Android for sports, racing and golf scores and stats, Dropbox, IMDB Movies and TV.

CIO points out that these apps were downloaded and tested on a Samsung Galaxy with Android 3.1 - Gingerbread. I have all of the basics except Poynt (which is not on Amazon) and ScoreMobile (Amazon Appstore for Android link) on my Toshiba Thrive

For a longer list, check out articles by Practical eCommerce "35 Android Apps to Run Your Business" and "39 Online Productivity Tools to Go Officeless"

Did you notice a particular still missing-in-inaction app? 

Where is Netflix? Once they get they business model and pricing model in order I hope they will create a Gingerbread build. 


Sunday, October 9, 2011

Elizabeth Warren - Nontrepreneur

Elizabeth Warren - Nontrepreneur

Why should the government be limited? - The Ludwig von Mises Institute provides a solid argument. (The video link in their article should carry a warning label for total stupidity by a candidate). 
"Now notice in Warren’s argument is the assumption that because the state provides benefits to people, then is justified letting you keep only an unspecified “hunk” of your profits. Because she is a statist, and views the state as legitimate, it is no different in kind than private entities, like a shopping mall. If I set up a shopping mall, to permit a store to set up a storefront there I can require him to agree to give me a percentage of his sales or profits–I let him keep a hunk, I take a hunk. I am providing him with infrastructure and access to customers, after all. We can negotiate the relative size of the respective hunks we are entitled to. But in principle I could demand most or all of his profit–he can take it or leave it."

Taking the Argument One More Step

Austin is a great source of musical talent. Singers, songwriters, musicians. Would Warren argue that the guitar player is indebted to every person with any input to the design, manufacture or construction of the guitar? Should the artist share revenues with the manufacturer? 

What about the Intellectual Property that represents music theory, notes, scale interval and music notation? I guess she is OK with the loss of music in the Public Domain (See article about Lawrence Golan v. Holder).

The Fatal Flaw of Nontrepreneurism, and socialism, and Warren

We are all here because good ideas win out over bad ideas. Everything is built on that which happened before. I'm no philosopher, but the U.S. is great because of the way we take ideas, build upon then, take chances to bring them to market. If you think music is a poor example, ask an established artist about how long it took to become successful. Ask a new artist how many hours of practice it takes to make their product better, to allow them to become successful. The government does not own first stake of success. 

Bottom Line: 

A third party (typically government) taking from one person to give to another is Nontrepreneurism at it's worst. Warren is tone deaf.


30-Year-Old Stereo System Sounds Better

30-Year-Old Stereo System Sounds Better

Gizmodo: Why Your Dad's 30-Year-Old Stereo System Sounds Better than Your new One:

"C|Net's Steve Guttenberg sheds light on this interesting development that over the years, actual sound quality became a secondary selling point since most people started buying their equipment either online or from big box retailers. People started caring more about the number of connections and wireless interfaces and wattage of systems. As a result, there was less money in R&D budgets to spend on advancements in sound."
Sound Quality, or back panel connectivity?

Moment of (Personal) Sadness

My Concept 7.5D is now considered "vintage". For those of you that spend a lot of times on planes, have you noticed that engine roar has changed from high-pitched whines to a mellower, smoother tone? The market wanted quieter engines and companies responded. And, the market wants multiple connections (input and output) with less emphasis on sound quality. And really, when you are playing an MP3 or steaming low bit-rate music, quality is not key. My Sony and Sherwood just don't measure up to the old Concept.

Sit Down and Listen:

To see the difference, put a CD into an older system, sit down, and turn up the volume.

Bottom Line:

Steve Guttenberg is correct, sound is secondary. Too bad, because an acoustic guitar (Petty, Orbison, Clapton), or grand piano (Glass or Mozart), or a classical piece featuring a harp streamed on the new equipment sound a lot like a 20 year old jet engine. Bit rate and connectivity are more important than depth and emotion.


Full disclosure: I've been friends with Anna for a long time, her CDs are amazing.

Friday, October 7, 2011

Nontrepreneurism Part 5 - Groupon Hari Kiri

Nontrepreneurism Part 5 - Groupon Hari Kiri

Continuing Discussion of: How Nontrepreneurism is Killing the U.S.

Benjamin Pimentel of MarketWatch reports Groupon to ‘significantly’ cut online marketing
"This appeared to be a dramatic reversal of an Aug. 25 email in which CEO Andrew Mason wrote the following: “We are currently spending more than just about any company ever on marketing. ... Why do we spend so much? The simple answer is ‘because it works.’ ” Mason did say in that August message that Groupon “eventually” would “ramp down marketing just as fast as we ramped it up,” adding, “We aren’t paying attention to marketing budget (just marketing ROI) in the way a normal company would, because we know that even if we wanted to continue to spend at these levels, we would eventually run out of new subscribers to acquire.”

Why is this Nontrepreneurial?

Products have a cost and a price. Groupon is great at lowering price, but not cost. The refrain is that people that try your product or service will become repeat customers is slowly being challenged. 

Ever notice that Apple products rarely go on sale?

SmartMoney covers the failure to retain: 50% Off? Repeat Groupon Customers Can Do Better:   
"The program is likely meant to entice more businesses than consumers. Judging by the several hundred sites on the market, consumers just can’t get enough of 50%-off facials, kickboxing, Thai takeout and other cheap luxuries. Yet studies show that less than a quarter of customers go back to that business for a second, full-price visit. And why would they, when there’s another spa, gym, or restaurant offering that enticing 50%-off deal? That poses a problem for sites trying to entice retailers, and retailers hoping to gain new customers by offering that steep discount.

Smart Businesses Learn Quickly

If my inbox is representative, the discounts are becoming less enticing (beekeeping classes, concealed firearms classes, and cosme-ceutical offers). I liken the offers to the Amazon's "Today's Deal, Best Deal Widget" - where Jewelry is constantly 70-80% off. I guarantee you that I will never pay full price for standard (non-differentiated) items. 

If you have a terrific (differentiated) product or service why would you discount it by 75%? Social Media (i.e. YELP) should be driving traffic to you. What are the margins built into your product/service if you can consistently sell at 75% off?

Basic Business Question:

How long can you attempt to attract customers at 70-80% off?

Groupon is cutting their advertising budget, but encouraging to continue to buy their advertising and cut your prices, on the hopes of customer acquisition (which happens with each 75% off sale) and customer retention (which appears to be less likely at full price). 

Bottom Line:

Watch what they do, not what they say - although, in this case, they finally admit their limitations. 


Why YELP? Three Austin Restaurants Close; More on the Way?

Why YELP? 

Three Austin Restaurants Close; More on the Way

Cody Lyon of the Austin Business Journal delivers the bad news: Three Austin restaurants close; more on the way?
"They always say that high profiles death’s comes in threes. That was the case this week in the Austin restaurant scene. In one week, three of the city’s widely known culinary destinations — The Belmont at 305 W. Sixth St., El Abor at 3411 Glenview Ave. and Hickory Street at 800 Congress Ave. — all shuttered their doors. Could more closures be on the way?"
The answer appears to be "Yes", even though the Austin economy is doing well.

Good restaurants, and any good business, deserve the praise. They deserve the exposure to a wider audience. Your recommendation might entice one more person into their establishment. Don't recite slogans or advertising language - What did you like? What makes this place better than others? 

What would you tell a friend about the experience?

My Review of Teji on Yelp:

Not your Mother's Indian Restaurant.
In fact, you probably don't want to take your Mom unless she is open to hole-in-the-wall, less than spotless dining. Teji is "in the back" of a small grocery store. They do a ton of take-out, and have room for 12-14 people to sit down for a meal. Waitress was helpful and fun to chat with. 
The food is great. Hot, not too spicy - although you can have them dial it up if you like blood coming out of your eyes. Very large menu, with goat and vegan options (ummmm, goat). Try the lentil soup.

In the middle?

Many restaurants, many businesses, fall somewhere in the middle, where a few minor fixes can really help them to the next level. Your feedback, assuming they are paying attention, can lead them to fix the problem. 

Z'Tejas YELP Review:

No zip, no zing, no pizzaz - the waiter was sleep-walking.  
Waiter was asleep. Party of 7, first round of drinks, appetizers (boring), takes order, another round, dinner arrives... water arrives, delivers wrong soup, delivers wrong meal (actually 3 wrong plates + 1 soup were placed on the table and taken away). Check arrived 15 minutes after the table was cleared. 1-Star service.
  • Roasted caulifolower soup, 4 stars
  • Chile Verde from the appetizer menu 3 stars (wife's is better). 
  • Jack + Club soda put me at ~$30 without ordering a main course (eek!)
And -- the parking (0 stars) is HIDEOUS! Unless you are driving a smart car or motorcycle expect to 1- park outside the main lot and hike in, 2- park in the main lot and get your doors dinged, 3- fish out a few more bucks to pay the valet to park in the 2/3rds of the lot reserved for valet parking.
Z'Tejas' manager called me after the post. Everything but the parking can be fixed. They may get another try. 

On the Slip Side:

Bad businesses deserve a quick and fitting end. Make sure your feedback is accurate, and that you present a few facts to support your opinion.

Payless Shoesource Example:
If you like the super stuffy feel of a designer shoe store - you'll love this place. Staff ignored everyone, and didn't even break their conversation while we were checking out. You get all of the attitude with none of the quality  (Returns will happen on Monday). 
Went over to Prime Outlet and paid more for Sketchers. The Sketchers store was super busy, but we got help from both cashiers during the visit.
Payless is a total waste of neon lighting.

Bottom Line: 

Reward your favorites, encourage the rest! 
A well considered review is worth gold.


Thursday, October 6, 2011

Nontrepreneurism Part 4 - Green Energy

Nontrepreneurism Part 4 - Green Energy

Continuing Discussion of : How Nontrepreneurism is Killing the U.S.

Thomas Pyle of US News: Obama Has Not Learned from Solyndra Scandal 
"As difficult as it is to understand why the government rewards continual failures with taxpayer dollars, there really isn't a method to this madness. Solar is, and has always been, an unreliable and inefficient way to generate electricity. The Energy Information Administration estimates that the levelized cost—the net cost of installation divided by anticipated lifetime energy output—is 21.1 cents per kilowatt hour for a photovoltaic solar (solar PV) plant and 31.2 cents for a thermal solar plant. That is far more expensive than the 6.6 cents per kilowatt hour for conventional combined cycle natural gas".

If you want to put solar panels on your roof... go for it.

If you want to ride a stationary bike for 10 minutes to make toast, (I admire Ed Begley, Jr., he talks the talk and walks the walk)... ride on!

If you like a green company... send them your money (invest, aka: put your money where your mouth is!).

Bottom Line: 

Taking my money to support your causes is wrong.
(It is neither "right" or "left", it is just WRONG). 

Now to skim Political Cartoons on US News website to get me in a better mood.


Nontrepreneurism Part 3 - Cars and Clunkers

Nontrepreneurism Part 3 - Cars and Clunkers

Continuing Discussion of : How Nontrepreneurism is Killing the U.S.

Sheldon Filger in the Huffington Post: “Cash for Clunkers is Really Economics for Dummies
“In confronting a crisis of epic proportions, one can do the heavy work of crafting a well conceived, comprehensive strategy. But why bother, when short-term gimmicks are politically more feasible.”
[Editor’s note: Wonder if HuffPo saw the BusinessInsider article below?]

Nikhil Rheja on Seeking Alpha: “Cash for Clunkers: Wasteful and Stupid
If the debt is high in the country, consumers become more likely to default on their obligations and also increase their savings… The Cash for Clunkers program, however, attempts to force the consumers to go into deeper debt which they can probably not afford to service if they lose their jobs.
[Editor’s note: Nikhil's analysis, that is his job title @ Keystone State Capital Corporation, is right on the mark.]

Kristen Korosec on BNET News: “Cash for Clunkers Pilfers Renewable Energy Loan Program
For all of the benefits touted by its supporters – both economic and environmental – it’s worth noting that the money has been taken from another program aimed at creating jobs, reducing emissions and making the country more energy independent.
The $2 billion used to extend cash for clunkers was drawn from the Department of Energy’s loan guarantee program, a $6 billion fund to support clean energy projects that use innovative technologies. That means projects using biomass, hydrogen, solar, wind and carbon sequestration technology would qualify.
[Editor’s note: I guess we may never know if Solyndra II was avoided because of C4C. Did we dodge a bullet here, or did we just chamber another round?]

Vincent Fernando and Lamelia Angelova in the Business Insider: “Cash for Clunkers MASSIVELY distorted GDP
According to the Bureau of Economic Analysis (BEA), motor vehicle output spiked a seasonally-adjusted 157.6% quarter on quarter. This is completely unprecedented. Vehicle output is clearly going off a cliff next quarter…

Bottom Line:

Cash for Clunkers was a mess and not a solution. It distorted the economy while helping some groups over others at the expense of the taxpayer. 

I'm watching for the inevitable "C4C Loans Start to Go Bad" headline.


Nontrepreneurism Part 2 - The Student Loan Example

Continuing the discussion of How Nontrepreneurism is Killing the U.S.

Charing Ball gives her insight in The Atlantic: Will Student Loan Forgiveness Stimulate the Economy.  
"Justin Wolfers, of Freakonomics, offered several reasons for why he believed that forgiving student loan debt will do little to stimulate the economy. For example, he argues that college grads typically have higher incomes than non-degreed workers and if the government eliminates their debts, the educated class would be more inclined to save their money as opposed to spending it within the market. However, the flaw of Wolfers’ argument is that even with a wage step back for college graduates, a college graduate is still expected to make double that of a high school graduate, who is slowly being pushed out the employment market."
Beyond the minor errors in the lifetime income argument, there is the complete omission of what happens to the lender. The "forgive student loan" argument: protects the schools - where tuition inflation should be as offensive as Health care inflation, protects the students - who may choose colleges above their means, study subjects with low economic return (I graduated with a liberal arts degree and will argue that the choice is valid, but complaining about job opportunities afterwards is not) and then have trouble securing a career to pay for their loans a reasonable lifestyle. 

There is also a complete omission of what happens to society - if the government pays tuition, how many fluff courses would be delivered? Would we then need a Curriculum Panel to determine which classes the Government will pay for? Why is it reasonable to expect the Government to make good decisions? Is it more reasonable to think that government subsidies cause more problems than they solve?

Let's Re-frame the Argument
Mom and Dad have triplets about to graduate high school. They have saved a small pot of money for college expenses. How should they divide their limited funds? What should they consider? Does a Government Loan agency consider any of the same facts? 

Ummmm, No
Sign here (get your parents to co-sign as well), we will send your check to the University. 

Bottom Line: 
College is an economic decision, one that I believe will better a person's outcome in life. Like all economic decisions a certain degree of cost-benefit analysis is needed. I'm totally OK if you want to go to an expensive school, pick a degree that is interesting to you, then get a job as a community organizer... just don's ask me (or my neighbor, or my bank, or my government) to foot the bill for the choices you freely made.

Articles about Student Loans in my "Blog This" folder.
So much material, so little time. 

What's Next - How Nontrepreneurism is Killing the U.S.

Defining the Nontrepreneur: 

'Hey, Tories, who knows what a nontrepreneur is?’ - Andrew does the Conservative Party Fringe By Andrew Orlowski • The Register

Posted in Public Sector, 6th October 2011 09:28 GMT

The Common Dialogue 

I bought a car, but can't pay for it... it should be free. 
I bought my house, but can't pay for it... it should be free.
I borrowed money to go to college, but can't pay for it... it should be free.

I promised my employees the moon and a pension too, but now I can't pay...
I lent money to everyone that could fog a mirror, paid myself huge bonuses, but now can't pay for it...
I added thousands to my payroll, fought two (or three or multiple - who can actually count) wars, promised free ice cream for everyone...

"Don't Take From Me", take from the other guy (and give it to me)!

What happens when a culture that grows on giving things away for free decides that everything should be free?

Redistribution of wealth is addictive - until it is your turn to give. 


Monday, October 3, 2011

Are Research Papers a Waste of Time? - Room for Debate -

Are Research Papers a Waste of Time? 

The NY Times article asks a worrisome question, Are Research Papers a Waste of Time? - Room for Debate, then provides several linked articles from academics willing to argue both sides of the debate. 

"Is the research paper still justifiable as a means of grading a college student's performance? Critics of the form say it is outdated because the Internet has made sources so readily accessible. In addition, argues an article published recently by the John William Pope Center for Higher Education, research papers promote deference to conventional opinions. 
Thomas Bertonneau, the author of the article, "Down With Research Papers!" argued that students should instead be assigned essays, focusing on concise arguments staking out a point of view rather than long, informative surveys of a subject.
 Many of the professors who assign research papers would disagree that they are encouraging students to think conventionally, and point out that the essay has its own limitations. If research papers -- or dissertations, for that matter -- were to become a thing of the past, what would we lose in our pursuit of knowledge? 
Is there a better way to assess knowledge?"

Ummm, that would be a "No".

The ability to collect a wide range of facts and opinions, compare and contrast that body of information, develop a line of reason, a hypothesis, or argument and effectively communicate the author's interpretation, argument, or position is the best way to assess knowledge. 

No Rolodex of factoids, no matter how deep and accessible, is a suitable replacement.

Is my position clear?