Hulu vs. TV Advertising Rates

Looks like the marginal benefit of advertising during programs shown on Hulu must be higher than that of the same program shown on TV.

Marketers typically pay $20 to $40 per thousand viewers for a prime-time ad. On Hulu, which began offering shows to the public in March 2008, an ad on the animated series “The Simpsons” costs $60 per thousand viewers, Michael Nathanson, an analyst at Sanford C. Bernstein & Co. wrote in a June 18 report.

Why bother?

Oh, yeah, to give us a reason to make political donations:

The cap-and-trade bill is a travesty. ... It gives emission permits away, and tells utilities to rebate the windfall to consumers, so their electricity bills do not go up. It creates a vastly complicated apparatus, a playground for special interests and rent-seekers, a minefield of unintended consequences – and the bottom line for all that is business as usual.

Insure this

Where there is demand...:

...on the first play from scrimmage against LSU on Oct. 10, 1998, a gruesome knee injury ended Florida senior defensive tackle Ed Chester's career. Fortunately for Chester, he had bought an insurance policy from Gainesville agent Keith Lerner after deciding against entering the 1998 NFL draft. Lloyd's of London, the venerable firm that insured Bruce Springsteen's voice and Angie Dickinson's legs, underwrote the policy. Thirteen months later, Chester walked out of Lerner's office with a $1 million check. Chester never played in the NFL, but if he handled his finances correctly, he never had to worry about money again.

Management in Venezuela

El Presidente (for life?) first grabbed the guns (suppressing dissent is easy if only your supporters have guns), and then paid off those who supported him:

... my friend from Venezuela manages a factory, and told me 8 years ago Chavez made a law that you cannot fire anyone who makes 3-times minimum wage or less. So he has some employees who literally do nothing, and he can't fire them. Another one had a night shift and caused a lot of problems, so they put him on the day shift so they could better supervise him; he went to the department of labor to complain, and now my friend has to hire a lawyer to deal with this.

Is this enough?

College Bound Sisters pays $1/day to 12-to-18-year-old girls to reward them for not getting pregnant.

Some recent graduates earned more than $2,000 and are an inspiration to those still in the program."I might want to be a teacher for a few years and then be a lawyer," said 12-year-old Chelsey Davis. "I might want to be an actor or singer," another girl in the program, Amanda Davis, added. Program director Laurie Smith said those aspirations are more achievable because of the incentives the program provides and the friendships it helps create.Smith said nearly 100 percent of the girls who finish the program have gone on to graduate college.

However, if a girl drops out or gets pregnant, her money is divided among the other girls still in the program.

Coinstar Economics

Coinstar offers kiosks in retail locations (grocery stores and similar outlets) that count your loose change. Dump your change in and get a voucher to redeem for cash at the store checkout. Coinstar charges a fee of 8.9 cents per dollar counted.

The company also offers a couple of other redemption options that allow you to avoid the fee. Coin counting is free when you exchange the coins for a gift card from a variety of leading merchants (Amazon, CVS, iTunes, JCPenney, Lowes, Starbucks, etc.). Also, if you donate your change to a non-profit (option available from the machine), there’s no charge, and the machine prints a tax deduction receipt for you.

A couple of questions occur to me: why take the cash option (I wonder how many people do)? Even if you calculate the time it takes to redeem the gift card and the probability that you won’t spend it, I can’t see that costing more that 9%. Second, I guess Coinstar must have some deal on the gift cards such that they don’t pay full price. Otherwise, where does the margin come from? I wonder how much of a discount they are getting, and how it compares to the 9% they make on the cash option.

Did the CRA contribute to the financial crisis?

One man's solution is another one's problem:

Defenders of the CRA have tried to maintain that the law didn't require lenders to adopt lax lending standards that characterized the boom years.

Unfortunately, that's just not true. The CRA led directly to lending practices that included extremely low to nonexistent down payments, outrageous loan to value ratios and other "innovations" that later became some of the best predictors of defaults and foreclosures.

It's the Incentives, Stupid, III

All we are saying is "give bankruptcy a chance."

Some of these consequences might have ensued, but the risk of widespread ripple-effect collapses--also known as contagion effects or systemic risk--was almost certainly overstated. The creditors of Bear Stearns would have suffered losses, and the shareholders would have been wiped out. But this hard medicine would have sent a very clear message to the managers, creditors, and shareholders: Better watch what the company is doing, or you could get burned. In more technical terms, a Bear Stearns bankruptcy would have eliminated moral hazard--the tendency not to take precautions if you'll be spared the consequences of bad outcomes.

Let the sick banks die so they can be replaced with healthy stubstitutes

Former student John Tamny scores a rhetorical bulls eye:

As [President Obama] sees it, "one of the most significant contributors to our economic downturn was an unraveling of our major financial institutions." No doubt that's the conventional wisdom of late, but it's hard to see how it could be completely true.

Indeed, finance as we know it is nothing if not a very broad concept. While Ford Motor Co. can trace its beginnings to car manufacturing, Quicken to tax software and E*TRADE Financial to low-cost stock trading, all are presently significant players in the business of lending. More broadly, retail behemoth Wal-Mart would have been in banking years ago if it weren't for regulations meant to keep it out, while leveraged-buyout giants of the Blackstone Group variety are dying to pick up insolvent financial institutions on the cheap.

In that sense, the true contributor to our economic downturn wasn't so much the failure of banks, but instead a bipartisan failure within Washington to let market forces prevail whereby finance substitutes would have entered a marketplace badly served by various dead banks walking. Put more simply, the unraveling of major financial institutions is not what presently ails us, but an unwillingness to allow them to die so that they could be replaced by healthy substitutes is.

These Dollars are Still Strong

Retailers Dollar Tree, Family Dollar, and Dollar General all show strong recent performance:

At Dollar Tree, Inc. (3,667 stores), earnings were up nearly 38 percent in the most recent quarter. In its most recent quarter, Family Dollar Stores (6,654 stores) said same-store sales were up 6.2 percent. Both companies' stocks are higher than they were when the market peaked in October 2007. But Dollar General (8,400 stores, $10.5 billion in 2008 sales) is performing even better. KKR says the value of its stake in the company is up 30.8 percent since July 2007, when KKR and several other partners completed the $7.3 billion acquisition, just as the fat lady was singing her final leveraged aria.

Goodlettsville, TN-based Dollar General is doing particularly well:

After rising 9 percent in fiscal 2008, same-store sales grew by 13.3 percent in the first quarter, better than smaller rivals or Wal-Mart. Most significantly, profits aren't being driven by heavy discounts. In the most recent quarter, gross profits were 30.8 percent of sales, compared with 25.8 percent in fiscal 2006.