My Dream Job

In France, people get paid to watch 50,000 hours of French T.V. to make sure there are no add placements.

But in the great U.S. it is not illegal to have product placements. This is one of many reasons why our movies and television is more successful. These are revenues that are coming in giving American film and T.V. a huge advantage.

Makes me think of Wayne’s World when they go way out of their way to advertise products. (Update: Picture Added)

The Economist reports that the EU is now removing those restrictions, which is great for us free-market capitalists. The article also mentions how important this is because of things like Tivo.

I guess I never thought about that before. The demand for commercials are decreasing and the demand of product placement is going up. If done right, I believe that product placement could be more effective. I would also say that I personally would rather have no commercials with lots of product placement but maybe we aren’t there yet.

The EU though still makes it illegal to have product placement on kids programs along with placement of alcohol and cigarettes.

Wow, the Economist reports further that governments are looking in to “placing” behavior. This would be used to encourage “environmentally friendly living, safer sex or staying in school.”

This is pretty stupid. I hope the people of Europe (I doubt it) uprise (I doubt it) and demand lower taxes (I doubt it) because it is their money that is paying for this.

Leave it to the government to take something free-market and mess it up.

~PCCapitalist

A Message from Not Alan Keyes

“In the case of prostitution, there is no substantial argument that can be articulated as to how our society will be bettered with its legalization. There are many things for which there is a case that can be made for their legalization, peddling flesh just does not happen to be one of them. When this is tried in other societies, the results that are promised cannot be found. For instance, we can observe an increase in not just prostitution, but even illegal prostitution. The dirty little secret is that yes, even when you legalize it by allowing for instance “Houses of Ill Repute”, the society will still experience the same forms of street prostitution as it always has before. There just simply aren’t the incentives for these unscrupulous people to come in off the street and offer their services for what will undoubtedly be less money. Now, the reason that prostitution is illegal in the first place is because of the fact that it is so corrosive to the moral bedrock of society. Many of the problems that can be found in society today can be traced to the fact that sex is not something that our society holds in high regard. Higher abortion rates, increased crime, increased diseases, all of these are functions of a society that loosens its’ proverbial ‘sex’ belt if you will. Our society is a much more sexually liberated one then the one our grandparents grew up in, but all of those maladies are the cost. So many people so often look at these issues at surface and say and give it approval based on a whim without ever evaluating the real and evident consequences. A child who grows up in a society where prostitution is allowed by their government is one who grows up with a very different sense of right and wrong. Prostitution is ruining lives every day all around us, breaking up marriages, putting mothers out on the street, and even in some cases bringing corruption in the home. There is no society that can justifiably look at all of these ills that it verifiably causes to society, and allow that to on with the consent of the establishment. And even so, questions would remain if it were to be made legal. Are we going to allow children to prostitute? If a woman doesn’t want to prostitute, does that make her ineligible for government provided unemployment? Are we going to be able to look our children in the face and say “you still shouldn’t do that”? These are all question that other societies have had to come to the difficult answers with, and I am sorry, but those are societies that I would not for a moment think to trade places with when we really do have the greatest country on Earth. So, much like illegal immigration, drugs, and even underage drinking, let’s not address the problem by not calling it a problem. Let’s address the problem by fighting it with existing laws and regulations.”

Even though the other side won, this is the side of the ‘NO’s’ I think it is well written.

Slow Night

Slow night…..

I was out watching the Republican debate. I thought it was mostly crappy.

There was one subsidy question that was asked to like one or two candidates…
One tax and one spending bill question….

I don’t even remember any health care questions

and Mitt and Rudy just acted like no one else was on stage for the first 30 minutes.

Surprisingly McCain did well….

Huckabee still looks strong

and Fred is a little better but still boring….

Guess who is doing price controls?

I warned Kazakhstan not to create price controls…..
I warned Russian President Putin not to create price controls….

But Zimbabwe has under Mr. Mugabe…..

Maybe I should change the name of the blog to PCCapitalistAgainstPC (second one being price controls).

This has created such large shortages that now there aren’t enough products on the shelves to predict the inflation rate.

This from the BBC:

“Many staple goods are often absent from shop shelves after the government ordered prices to be halved or frozen in a bid to stem galloping inflation. September’s inflation rate was put at almost 8,000%, the world’s highest.

Other reports suggest the rate could be at near 15,000% and the International Monetary Fund had warned it could reach 100,000% by the end of the year.”

This has created a black market for those goods…

The BBC continues:

“Mr Nyoni said the Central Statistical Office has delayed the release of the inflation figure until an accurate way of calculating it can be found.

“We went to too many shops to observe and so compilations have not been completed,” he said.”

But one sentence sums up the problem:

“Manufacturers have said they cannot afford to sell goods at below the cost of producing them.”

Another example of why price controls are bad. Especially when inflation is just how much money is in the economy….

Guess who controls that?

The Government

Goodnight folks, and thanks for playing how dictators run horrible monetary policy and try to fix their mistakes by starving people. I mean (with great sarcasm) protecting the citizens from high prices.

Of course there are no products there to pay the government’s fixed price.

~PCCapitalist

What is Kiva?

Well from the website it says this:

“Kiva lets you connect with and loan money to unique small businesses in the developing world. By choosing a business on Kiva.org, you can “sponsor a business” and help the world’s working poor make great strides towards economic independence. Throughout the course of the loan (usually 6-12 months), you can receive email journal updates from the business you’ve sponsored. As loans are repaid, you get your loan money back.”

It says it has been featured on Oprah and has been in Bill Clinton’s book. Surprisingly because this is very capitalist program.

Benefits:
In developing countries, they may not have the financial institutions that are needed to help their small businesses.
It lets investors not have to go through banking fees to loan money and still gain interest.
It lets investors supply as little or as much as they want to the small businesses (even though I think there is a $25 dollar minimum.)

Possible problems:
With any loan there is a possibility of default.
You can only look at profiles and you a trusting the companies in that country to only allow the good people to ask for loans.
This one may be the biggest to most liberal/populists; you don’t know where the money is being spent. They could be buying drugs and selling them and paying you back.

As Economics would suggest people are rational and self-interested so that may not matter.

For an experiment, I am going to loan $25 dollars to one lucky small business owner in a poor country.

Here is the info on my person: Martha Enriqueta Castillo Aries
” Martha is one of many mothers that are alone in raising their children due to the fact that her husband went to the United States to work. She has to struggle to raise her children well. Since there are long periods of time where her husband can not find a stable job in the U.S. She does not recieve enough money to pay for the needs of her children. That is how she began to sell cosmetic supplies to her friends and neighbors by catalog. Later she began to sell shoes and crafts. Presently she has more clients.

However, she has taken a special liking to the selling of clothing products and for that reason, she has decided to buy winter clothing, that way she can offer them to her clients. This is why she is asking for a loan of $650 that she will repay in 6 months. With this loan she will be able to buy clothing to sell, like jackets, jeans, and sweaters. With your help Martha will support her children even though her husband is so far away.”

The total loan amount is $650 dollars, there was $625 of it raised and my $25 completed it for her. The loan is for six months. It says the average interest that is paid to the company that brokers her is 54%. That’s huge.

This is also $7,133.42 in pesos that she is getting for the loan.

I will keep you readers updated as I get progress reports.

~PCCapitalist

A Look Back on Economic History

In 1927, Congress passed the McFadden Act which made it against the law for banks to have branches in different states.

Thank god the Riegle-Neal Interstate Banker Act repealed it but it took a while. This didn’t come until 1994.

This allowed for less competition. Little banks that were inefficient survived because of this act. My book on money in banking by Frederic Miskin says:

“The simplest explanation is that the American pubic has historically been hostile to large banks. States with the most restrictive branching regulations were typically ones in which populist antibank sentiment was strongest in the nineteenth century. (These states usually had large farming populations whose relations with banks periodically became tempestuous when banks would foreclose on farmers who couldn’t pay their debts.)”

Banks avoided some of the restrictions but could you imagine a world still like that? With debit and credit cards and billions of online purchases. Even some states would only allow one branch per bank. This would be so inconvenient and you would pay ATM fees all the time. Each individual bank would have to work with Visa at creating a debit card.

Banks are buying other banks and this is a good thing. This will create more efficient banks and it will be a lot harder for banks to fail that are big. An example is if Michigan banks fund the auto industry and all of a sudden there is something hurting the auto industry, the banks will fail in Michigan because the auto industry won’t be able to pay back their loans. If Michigan banks can also lend to California orange growers and Texas oil drillers, they will be more stable.

This is another example of letting our hearts get in the way, which allows our government to make short-term deals that take away rights.

~PCCapitalist

Are Economists good criminals?

Fox News Reports:

“Rafael Robb, once a tenured economics professor at the University of Pennsylvania, faces a likely prison sentence of 4 1/2 to seven years for bludgeoning his wife, Ellen, on Dec. 22….Robb was an expert in game theory, a complex melding of psychology, human behavior and economics — all aimed at determining what one’s adversary will do next.With that background, police say, Robb may have thought he could outsmart them.”

I found this to be interesting. A former Ivy League Professor killed his wife and tried to make it look like a burglary. They then use his economic background to explain why he did that.

That begs the question: What professor would be the best at being a criminal?

Economists: see argument above
Psychologists: They understand how people think, so they could try to get people to think differently; see Economist.
Criminal Justice: They know how the system works and even the technical stuff.
Government/Political Science: They understand their constitutional rights.
Chemistry: Can make chemicals to slip up the police or even kill their victim without a trace.
Biologists: Know how to treat the body.
Geologists: Know where to bury the body.
Marketing: Appeal the cops to a different murderer (products).
History: They could tell you how people got caught in the past.
Civil Engineer: Could work with the Geologist at creating a structure to bury the body.
Leadership: To coordinate the above.

Okay, I know this is crazy. Most people who go to college don’t commit serious crimes. They don’t need to, they make plenty of money and their opportunity costs are way too high.

But this is my Ocean’s 11 for a skilled criminal group…

~PCCapitalist

The change in job sectors relative to Wealth

I was preparing for the debate tomorrow between the College Republicans and the College Democrats, as I was drafted to speak on the economic issues. The question was brought up; Does NAFTA help or hurt the U.S. Job Market? When I came across my old notes for free trade, I found a World Bank Report.

People’s jobs change as they get wealthier…

If we divide the types of jobs between Agriculture, Industrial, and Service, we see a large change as in countries incomes and percentage of GDP.

As a percent of GDP	Low-income countries	Middle-income countries	High-income countries
Agriculture	25%	11%	2%
Industry	38%	35%	32%
Services	35%	52%	66%

This shows that as a country gets richer the Agricultural sector declines fast, Industrial sector slowly declines, and the Services sector shoots up fast.

Why does this happened?

Let’s look at a simple model: When man is first on earth, his first priority was to create food. He then began to create more food than he could eat so he sold it to others. These other people no longer needed to farm because it was cheaper for them to just buy it from the first guy. He will then find some other good that he can create that would be worthy to the farmer to trade for food. Let’s say shoes. He would start his factory and hire workers and now they would be paid (with a current system set up) and they can buy shoes or food. As there will be enough shoes and food in the market, people will innovate and make other products. When all of that is said and done, people will demand more services and there will be more people in general. That means more doctors, lawyers, hairstylists, entertainers, and many other things.

Innovation is a big part of this. Farmers will have better tools and will need less people and will be able to expand output and lower the price.

Free Trade acts like innovation. Instead of finding a piece of machinery to make a car, we find that people in Mexico can make it faster and cheaper.

Trade and comparative advantages between countries have also caused this.

It has allowed us to work it higher skilled jobs, so that we don’t have to work in shoe shops like our parents and grandparents, and they didn’t have to work on the farmer like their parents and grandparents.

As wealth goes up, our jobs move into the Services sector. There will always be a need for industry and agriculture but I would say this change has been very positive.

~PCCapitalist

Sunday: Freedom of Speech Watch

The Economist Reports that in South Africa that a media company called Koni Media Holdings is going to by Johnnic Communications, South Africa’s fourth major media groups. The Sunday Times that Johnnic owns is one of the most criticial newspapers of the government.

It printed information about the health minister’s confidential medical reports. Her name is Manto Tshabalala-Msimang and is famous for saying to eat garlic and beetroot to cure HIV.

The President’s buddy buying this newspaper would definitely change the tone of it.

The Economist also says: “Jane Duncan of Freedom of Expression Institute, a local watchdog, claims that the independence of the broadcasting regulator has been gradually eroded since the late 1990s. The government has been accused of turning the South African Broadcasting Corporation, the public broadcaster that remains the main source of information for most South Africans, into a lapdog”

Now of course, I do not oppose the takeover because if the free-market allows it, I am all about it. I recommend to the company who is taking it over to let the newspaper act freely and if that cannot be achieved then I call on any other newspaper to challenge the government.

Sometimes the media is the check and balance of the government.

~PCCapitalist

Something to think about….

F.A. Hayek once said this:

“The interaction of individuals possessing different knowledge and different views, is what constitutes the life of thought. The growth of reason is a social process based on the existence of such differences. It is the essence that its results cannot be predicted, that we cannot know which views will assist this growth and will not – in short, that this growth cannot be governed by any views which we now possess without at the same time limiting it to “plan” or “organize” the growth of mind or for that matter progress, in general is a contradiction of terms.”

I fully agree with this and I think there is a lot of wisdom in this. That this quote summarizes a lot of the themes that are on this blog. This is one of those quotes that doesn’t need to be explained.

You must just stop, read it once or twice, and find what it means to you. Because I am sure that you have seen where this could be applied.

~PCCapitalist