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Economics Pt 1 - Marketing for Dummies

by ThatBritGuy Mon Jan 12th, 2009 at 05:00:18 AM EST

Stereophile Magazine is notorious for its reviews of achingly expensive hifi. Exhibit A for would-be owners of sonic exotica is the ClearAudio Statement turntable. For a mere $125,000 you can buy a precision-machined 770 pound contraption, bolted together from wood, ceramic and aluminium, which you can use to play your favourite warped and crackly vinyl. It uses the same motors as the Mars Rovers, which presumably makes it useful for anyone who wants to play their music in a low density atmosphere.

As conspicuous consumption goes, the name isn't even trying to be ironic. But it's not really about the money. Stereophile's reviews follow a fixed format: "I was unconvinced that Very Expensive Product X would do anything at all, but having tried it the results are truly astonishing. Although I still have one or two lingering criticisms (which are so trivial I honestly hesitate to mention them, even in passing, although of course in the interests of journalistic integrity nonetheless I find myself forced to) the music pouring from my vinyl now sounds so very much better than it used to that I don't believe I'll be able to listen to anything inferior ever again."

too good not to be straight on the front page - afew


What makes this entertaining is that the same hyperbole is used for every single product, whether it's a monstrous turntable or something more exotic - like these Shakti Stones.

SHAKTI Noise Reduction Technology (NRT) absorbs and dissipates Electromagnetic Interference (EMI). Automotive Computers (ECUs) and audio/video components self generate a radiated EMI field that degrades signal transfer functions. The word SHAKTI means "energy." Through an energy conversion, inductive coupling process, the "antenna-like" circuits within SHAKTI attract and then resistively convert EMI to non-interfering heat. This increases horsepower and speeds up 0 to 60 times in automotive engines and improves resolution in high definition audio/video systems. No electrical connection is required because all interactions take place through radiated field mutual coupling. One need only place SHAKTI units in near proximity to the CPU or audio component to obtain discernible performance improvements.

These remarkable items not only make audio sound better, they also improve car acceleration by an impressive 2-3 horsepower - although as the website says:

`Customer perception during beta testing of SHAKTI units was filled with testimonials that the improvement felt much greater than the measured 2 to 3 horsepower dyno runs showed.'

Which is nice - only a very special kind of horsepower can feel better than other kinds of horsepower, and from that point of view Shakti Stones seem to be delivering on their promises. This may explain why one hifi reviewer bought eight of them for his system - although he hasn't told anyone if this has improved his 0-60 times. (Perhaps a low density atmosphere would help?)

But it doesn't end there. For a while a company called Silver Rock were selling a knob - i.e. a piece of machined wood - for $500. Replacing the mundane metal knobs on your amplifier's volume control with this miracle of varnish and lacquer - actual wood included - promised rapturous changes in musical performance. Inexplicably, the product seems to have been withdrawn - perhaps because when the entire Internet started linking to the page, the retailers discovered that yes, there really is such a thing as bad publicity. Steeping into the breech, you can still pay CHF 320 (about €200) for a set of three turned wooden ovoids which will supposedly `get rid of the metallic sound' of a cheap CD player.

By decoupling horizontally and providing a "excellent sounding" vertical interface medium (in this aspect similar to optimal spikes) they have an exceptional effect on audio equipment placed atop of them, be it CD-players, transformers, speakers and amps. The have an extremely positive effect on transparency, natural timbres, ambience reproduction and dynamics: the gain in coherency and focus is simply astonishing.

The point is proved on the website by connecting a cheap and nasty bargain-bucket CD player to a monstrously expensive amplifier and speaker combination. It's always good to see value for money, and turning a $100 CD player into one with a much more expensive sound is certainly impressive.

No round-up of hifi exotica can avoid a mention of Peter Belt's unique website, where he claims to be to be able to transform the sound of HiFi by adorning it with tiny pieces of foil and rubbing components with special creams. Because his commercial products aren't cheap, and he has the best interests of his customers at heart, he generously offers the following free advice:

Place a plain piece of paper under any ONE of the four feet of a piece of equipment. This applies to any piece of equipment, even if it is not an item of audio equipment. Listen to some music for a short time, then remove the piece of paper and see if you can listen to the same music with the same pleasure - without the plain piece of paper in position !!

Pin back ONE of the four corners of all curtains in the listening room with a safety pin.. Listen to some music for a short time, then remove the safety pins and see if you can listen to the same music with the same pleasure - without the corner of the curtain pinned back !!

If you have a vase of flowers or a pot in a plant pot in the listening room, stand the vase or the plant pot on a plain piece of BLUE paper. Listen to some music for a short time, then remove the piece of Blue paper and see if you can listen to the same music with the same pleasure - without the piece of Blue paper in position !!

(Note - punctuation and capitalisation retained from the original.)

It's easy - and indeed it's fun - to mock. But something interesting is happening here. HiFi demonstrates it in one of its purest forms, but it's hardly exclusive to the HiFi market. I'm sure audiophiles genuinely enjoy music, but they seem to part company with the rest of us when ever-more exotic combinations of expensive and unlikely hardware don't seem to have anything much to do with the sound. Audiophiles are dismissive of double blind testing, and it's no surprise that when double blind tests are attempted they inevitably score poorly. They're also prone to laugh-out-loud inconsistencies. One Stereophile reviewer enjoys recording the sound of his system onto cheap CDRs, which he sends out to readers so they can share the awe for themselves.

The phenomenon doesn't have a name yet, but if it did it would be something like consumer narcissicism. This isn't a perfect definition, because the sense of specialness isn't as arbitrary as it is in clinical narcissism. Instead, it seems to be less of a pathology and more about esoteric perceptions of manna and mojo. With both high end and low end hifi, the hardware becomes a fetishised extension of the owner's self image - a personal totem for the living room.

There's more that could be said here, especially about the psychology of projecting near-perfect isolation and freedom from corruption and external influences into a personal fetish. But instead of taking that detour, it's more useful to note that what seems to be happening is that spending money on exotica allows hifi owners to persuade themselves that they're equally exotic and significant - unique individuals gifted with a rare sensitivity far beyond the norm, and the rare spending power needed to bring it to its fullest expression.

It's not so much about music - especially considering that most of these unique individuals are in their fifties and over, with diminishing hearing. It's more about trying to possess mojo in an unusually concrete and solid form. And the hardware isn't just a positional marker of status, because the process is as much for internal as external consumption.

In narrative terms, the hardware gives the buyer an excuse to tell a story about themselves which starts with `I am the kind of person who...', and then segues into self-flattery and egotism. With hifi, this is amusing to outsiders, but largely harmless; in resource terms, exotic hifi hardware barely registers on the let's-rape-and-pillage-Gaia scale. Elsewhere it's very much more destructive, because this sleight of mind is so heavily conditioned and ubiquitous that it becomes the unconscious default for economics, marketing and politics.

Think `I'm the kind of person who...' and watch the ads. The Mac brand is based on fostering evangelical buyer narcissism. Apple set out to do this deliberately, and succeeded. But whole mythologies have been created around computer hardware and software by playing on these feelings - the Open Source movement couldn't exist without them - to the point where objective effectiveness starts to become less important than the experience of distinction and participation associated with owning and using the right tools.

The tools become signifiers of self-image. They may or may not be useful objectively. But `Being the kind of person who...' uses one tool, as opposed to a different tool, assumes a personal importance which is hard to justify dispassionately.

Of course it's not just toys for boys. L'Oreal's `Because you're worth it' slogan has been pilloried in public (but check out those comments...) The beauty market couldn't exist without consumer narcissicism. Nor could the shoe market.

This is narrative in action, and lifestyle marketing is based entirely on this kind of semantic and psychological anxiety-inducing flattery. It's hard to think of a significant non-essential product which isn't sold or marketed on the suggested basis of a fanciful, if not downright silly, self-labelling.

More subtle kinds of identity narcissism can span entire industries. Book publishing and fine art are founded on this - writing skill and aesthetic ability are built on the excellent sense of self-regard required to be a true connoisseur of art and literature. No one needs a $125 million painting, any more than they need a $125,000 turntable. But the option to buy is always good, by definition.

Mainstream economic theory runs into a problem here. Serious People like to tell us that consumers are rational actors, and that there's a rational value called `utility', which seems to be defined as the thing which consumers are rational about.

But most consumer activity is - clearly - not about rational choices. Survival essentials can, at a stretch, be reduced to pure utility. But a walk around any food store should be enough to make it clear that consumer choice is as much about satisfying narcissistic cravings for self-identification as for providing protein and carbs. Hence, sinful chocolates jostle with virtuous weight loss yoghurts, and every supermarket has an upmarket connoisseur range, traditionally signified by black packaging with gold or silver trim.

Only the utilities provide true utility, perhaps because water, sewage treatment and energy are so ubiquitous and so difficult to brand that there's no obvious way to turn them into fetishistic statements. If someone could make advertising flow out of the cold tap, it's a sure bet that they would.

Everywhere else, packaging and branding provide anthropological motivation. The less successful brands, or perhaps those aimed at less successful consumers, suggest instant gratification and the satisfaction of more or less plausible needs. (`Buy our shower gel - improve your reproductive potential')

The more ambitious marketers try to craft a mythology of identification, converting identity politics into a driver of consumer behaviour. If you want to `Be part of it' you can buy a `Product like no other', promoted by creative talent which wraps the nonsense in a glossy finish which makes it look respectable rather than ridiculous - as long as you're asleep and dreaming, and happy not to make any effort to wake up and wonder what the fuck is going on around you.

And so.

Capitalism is inherently pre-rational. It's atavistic, totemic, even shamanistic - but most of all, it's irrational and unconscious. Capitalism sells the illusion of mojo, marketing practical items as tribal power fetishes. The possession of these items confers magical powers of seductiveness, effectiveness, creativity and potency on their owner.

There's no difference between the so-called savage with a magically-charged weapon, and the so-called salesman with his streamlined BMW or Porsche. The sense of participation mystique with a numinous world of extended consciousness and personal power is the same in both cases. And in practice car ads - in fact all ads - deliberately emphasise the pristine unreality of the experience in an attempt to suggest the limitless dreamlike potential mojo of ownership.

We don't parse the economic world as savage, because we live in it, and we're indoctrinated from birth in a tribal narrative of enlightenment and rationality. But rational utility carries an awareness of consequences which is utterly lacking from this semi-mysticised world view. And historically, while the Enlightenment attacked religiosity, it didn't, and never has, challenged the political and tribal foundations of economics. So while religion is sometimes viewed skeptically, mojo economics has never been challenged or questioned in the same way.

Consensus economics barely acknowledges physical consequences because it has never been a calculus of resources. It has always been a social game which externalizes these atavistic perceptions of mojo and power.

Since these happen within a dream-like world of self-identification and delusion, rational consequences are deprecated - all that matters is the personal experience of mojo and the ability to persuade self and others that one's 'brand' has power, either through explicit display of power objects or through the marketing of personal charisma and persuasiveness.

Because mojo and charisma are synonymous, it's possible to swap charisma for cash. Entire industries - from personal training, to motivational speaking, to some of the arts - become possible with this relationship.

This is why if you visit a distilled environment like Second Life, everyone seems to be sleeping the deep sleep of the hypnotized and possessed. In a very literal sense, identity narcissism is a kind of possession - it eats identity to the extent where it defines the limits of thinking, feeling, desire and hope.

Real freedom comes from defining your own options - not in a `Be who you are' way, but with a conscious and rational balancing of original creative imagination with the demands of reality. Consumerism offers neither. Buying choices at a discount isn't freedom, it's a kind of psychological sharecropping - the collars and chains aren't physical, but they define and control behaviour just as if they were. The urge to buy an entry ticket to a brand narrative feels like freedom, and it's defined as freedom, but in reality it's a perfect opposite.

The lie is revealed by the way in which dissidents - individuals who aren't pathologically miserly, but are willingly to live frugally and don't try to `express themselves' through their spending or accumulation or lifestyle choices - are so rare in affluent cultures that they're invisible and almost unknown.

What does this mean for politics and democracy? More about that in Part 2...

Display:
Well done, great diary.  Perhaps also about marketing 2 dummies rather than for them. Diageo - the world's largest alcoholic drinks company has a strategy of having a drink for every occasion - from Champagne to fine wines, to premium spirits in all white and golden spirit categories.  Few can tell the difference between these premium priced products and "only label" generics.  It is the experience of branding oneself as the right sort of fun loving exclusive connoisseur that is being sold.

Once, whilst travelling in Mozambique, I stopped off in a tourist resort for a drink.  Having seen kids with swollen bellies indicating Kwashiorkor on the road, I was horrified to see some of the local drinking very expensive whiskys.  I asked the proprietor how they could afford to buy them and he replied:  they can't - one drink is equivalent to an average week's wages - but I have a storeroom full of cheaper brands I can't shift.  They want the full "western" experience.

notes from no w here

by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Sun Jan 11th, 2009 at 07:02:34 PM EST
Only the utilities provide true utility, perhaps because water, sewage treatment and energy are so ubiquitous and so difficult to brand that there's no obvious way to turn them into fetishistic statements. If someone could make advertising flow out of the cold tap, it's a sure bet that they would.

I don't know about sewage treatment, but bottled water is certainly getting some traction ; and the TV ads now contain EDF and Total branding, with some of the upstarts companies such as Poweo going for the greenwashed reputation...

Un roi sans divertissement est un homme plein de misères

by linca (antonin POINT lucas AROBASE gmail.com) on Sun Jan 11th, 2009 at 07:40:50 PM EST
Not to mention so called "green power" which you can ask to get from your power provider, at a certain extra cost. But it will still be the same electrons...

Peak oil is not an energy crisis. It is a liquid fuel crisis.
by Starvid on Mon Jan 12th, 2009 at 11:31:30 AM EST
[ Parent ]
"participation mystique", now that is a nice turn of phrase. Thank you. I wasn't much impressed by the intellectual heft of IT consumerization.

where products and technologies start out in the hands of consumers before making their way into the enterprise, has recently accelerated to the point that it has gotten its own (somewhat unwieldy) buzzword: "IT consumerization." Pundits are still trying to sort out what, if anything, the new term really signifies, but for my own part I think there's a real trend at work here.

In this short article, I want to break down the phenomenon of IT consumerization, broadly defined as the general move of consumer-level products and technologies into the enterprise, into three constituent factors, with a view to following up on these themes in later interviews with people out in the trenches of enterprise IT. ...

Oddly enough, I remember the Lotus Notes Apocalypse, or the standards battle for corporate buyers over ASP in the trades. The key benefit, irrespective of API, being liberation of the "worker" from their ERP and HR hell to "self-service" scale efficiencies. And "knowledge management" was a twinkle in Tom Stewart's eye, the curse of analysts. How old is this guy?

[U]sers develop their sense of how networked apps (messaging, collaboration, and archival) should look and function through daily contact with the lively ecosystem of consumer-driven Web 2.0 applications. Next to something like Facebook or Google Maps, most corporate intranets have an almost Soviet-like air of decrepit futility, like they're someone's lame attempt to imitate for a captive audience what's available on the open market.[emphasis added]

In the future, work will be (personalized) fun for me and I. If we aren't allowed to tele-commute. Or rent an address from the company VPN. Our job discripts will have infinite numbers of avatar agents, multiplying geometrically the value added by my computing powah and market intelligence across the globe. Total. Information. Awareness. Like Twitter. Or the NSA, but bettah.

Diversity is the key to economic and political evolution.

by Cat on Sun Jan 11th, 2009 at 09:16:56 PM EST
Thank you, TBG!  Now I better understand why I have always felt so disaffected and alienated from my culture of origin.  When TV hucksters would opine "You can't afford not to buy this!" my father would snort: "You can always afford NOT to buy something!"  Then when I was 17 I read Vance Packard's The Hidden Persuaders.  Made sense to me.  We are immersed in a sea of adverts and most people alive have had their minds formed under their baleful influence.  Little wonder that we in the USA are such a nation of sheep, and not just us.  George Lakoff says "repetition equals brain path" or something similar.  That is why I find cable TV unwatchable without a mute button handy.  It is annoying and oppressive.  I can certainly sympathize with friends who withdraw or live apart from the world.

One great gift my father gave me was a healthy skepticism about the world in general and religion in particular.  (Most of us on ET are probably familiar with Thorstein Veblen's hilarious description of church denominations as franchise distributors of belief.)  Fortunately, I grew up in the 50s in rural Oklahoma and learned to love reading before we got a TV.  But even there and then that fact set me apart. And from 1960, when I left home for college, until my wife and I got together ten years later, I rarely watched TV and did not own one.  For seven years we watched her little 13" B&W when we watched anything.

As a people we refuse to seriously consider the implications of turning over our children to the tender mercies of the TV programmers for babysitting on the cheap.  That probably does as much as anything to explain how we could elect GWB twice.  Rove was a very adroit marketeer and he pitched to an audience that had been well and truly conditioned by growing up watching TV.  There was a time when children learned argumentation from the adults, when people got together and actually talked about the events in their lives.  That has largely been replaced by canned TV entertainment.  There are a small number who manage to escape the net that is thrown over them by the media, but they are well less than 1% of the population, by my estimate.  Hope I am low on that estimate, fear I am not.

"It is not necessary to have hope in order to persevere."

by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Mon Jan 12th, 2009 at 02:26:50 AM EST
What's the opposite of consumer narcissism?
by Colman (colman at eurotrib.com) on Mon Jan 12th, 2009 at 05:13:13 AM EST
Survival?

You can't be me, I'm taken
by Sven Triloqvist on Mon Jan 12th, 2009 at 05:20:32 AM EST
[ Parent ]
My Apple Airbook is really lighter than other notebooks!

:)

In the long run, we're all dead. John Maynard Keynes

by Jerome a Paris (etg@eurotrib.com) on Mon Jan 12th, 2009 at 06:37:45 AM EST
[ Parent ]
That's only because you haven't put a lot of heavy music on it...

notes from no w here
by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Mon Jan 12th, 2009 at 09:41:27 AM EST
[ Parent ]
I'm not sure there's an opposite for the underlying human drive towards status. Death, perhaps.

However, you could presumably conceive of other ways to feed the status competition that would be more mindful of various resources.

by Metatone (metatone [a|t] gmail (dot) com) on Mon Jan 12th, 2009 at 09:24:42 AM EST
[ Parent ]
Very fine diary, TBG.  Because of it i decided to forego the new turntable, opting for an entire system which costs less that 75,000€.  I'll still have enough left over for the braking system on my McLaren F1.

I feel so much better.

"Life shrinks or expands in proportion to one's courage." - Anaïs Nin

by Crazy Horse on Mon Jan 12th, 2009 at 06:27:45 AM EST
Are you mad?! That system is way too big to fit into the McLaren. And just where in the chassis were you even going to stash those two potted plants? No, don't tell me, I'm not sure I want to know!

--
$E(X_t|F_s) = X_s,\quad t > s$
by martingale on Mon Jan 12th, 2009 at 07:43:32 AM EST
[ Parent ]
It's easy - and indeed it's fun - to mock.

But it is not easy to do it so well. Congrats.

My problem is that while generally your point is true and in-assailable, and I can say Huzzah with the best of them, specific points in my life indicate that your point isn't essentially or entirely true.

Part of this seems to be that there are certain laws of physics and R&D and productization and distribution that manifest themselves. My first experience with this was while in the industrial pollution control business. A valve, a plate, a corner of a vent will cost x amount for a certain amount of efficiency and life expectancy. You want another 1 percent of efficiency, it may cost 100% more. More platinum, more delicate work, fewer people with the expertise, longer delays and longer projects...on and on and the same for several factors like that and life expectancy...and each additional increment costs substantially higher as the implementation approaches 100%.

Then to the audio world, but in spades...especially as the world of listening, and more power capabilities and desire, and the knowledge of what was happening as sound reproduction went from tubes to transistors to digital components. Psycho acoustics and Total Harmonic Distortion and the relevance of Third Order Harmonics and other this and thats...all unheard of in the earlier age, all very important in understanding how to make the reproduction of sound and experience as close to the original as possible.

Do we need that? Do we need 99.999% efficiency at the smokestack? in the internet service? in the tonality of the speakers?

Not always, but the answer is obviously "Yes". Some part of 'we' needs it.

Do I need the far grooviest sound as I type this? No. Does an engineer or producer who sits in front of the speakers for 12 hours a day need to have less distortion (lest they go made or make wrong decisions that get mis-interpreted later in the reproduction chain? Yes. Do I need a better sounding system than most people, as I have had some training and experience with 'good better best' and don't like to hear some niggles that are distracting?

Yes and no. Needs and wants become the issue at some point.

On and on this goes, and can be translated into politics as well as television, friendships as well as reading matter. (PS - As an Apple affectionado, I am required (need to? want to?) take quite verbacious umbrage at any insinuations implied with your associating Mac products with unrequired hype.)

I don't want to try to justify the magic rocks with antenna like interiors, though I have witnesses things just as odd apparently doing something positive.

I could justify the turntable if need be. I could justify Larry Ellison's incredible yachts and the employment that they bring, the lifting of quality standards world-wide and interesting spin offs from the developments. I could also smear them (as well as my time as a keyboard junkie) for egregious greed in a world that has more people suffering than surviving well, more people merely surviving than creating well.

As that great philosopher Vonegut says so well:

La di dah.

Never underestimate their intelligence, always underestimate their knowledge.

Frank Delaney ~ Ireland

by siegestate (siegestate or beyondwarispeace.com) on Mon Jan 12th, 2009 at 07:01:08 AM EST
I think the problem is not there there is no place for quality, but that there is no necessary correlation between quality and price.

You don't "get what you pay for" you get to pay for the marketing budget and the profit margins as well as what you actually get - and that is the price tags that someone has put on your participation mystique.  If you buy into the hype you are paying through the nose.  If you know and buy what you actually need you can identify quality and value.

notes from no w here

by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Mon Jan 12th, 2009 at 09:35:42 AM EST
[ Parent ]
You don't "get what you pay for": you don't get what you don't pay for.

Most economists teach a theoretical framework that has been shown to be fundamentally useless. -- James K. Galbraith
by Migeru (migeru at eurotrib dot com) on Mon Jan 12th, 2009 at 04:20:19 PM EST
[ Parent ]
I could justify the turntable if need be. I could justify Larry Ellison's incredible yachts and the employment that they bring, the lifting of quality standards world-wide and interesting spin offs from the developments. I could also smear them (as well as my time as a keyboard junkie) for egregious greed in a world that has more people suffering than surviving well, more people merely surviving than creating well.

This boils down to three things.

  1. population control
  2. resource allocation
  3. sustainability

And really item one and two are subsets of item three. Sustainability is still ill-defined, even by people on this website. That's certainly part of the problem. Leftists defending apple also demonstrates an emotional and intellectual gulf that will not be easy to bridge.

you are the media you consume.

by MillMan (millguy at gmail) on Mon Jan 12th, 2009 at 11:10:04 AM EST
[ Parent ]
To live content with small means; to seek elegance rather than luxury, and refinement rather than fashion; to be worthy, not respectable, and wealthy, not rich; to listen to stars and birds, babes and sages, with open heart; to study hard; to think quietly, act frankly, talk gently, await occasions, hurry never; in a word, to let the spiritual, unbidden and unconscious, grow up through the common--this is my symphony.    
     William Henry Channing, clergyman, reformer (1810-1884)

I don't know. Just because McMansions are not viable in all places, doesn't mean that I have to live in a thatched condominium.

Isn't it funny that we find our arrows to be in the best fletched and in the handsomest of quivers: As a non-meat eater, I find that the capacity of the land to feed several times more people in a much more sustainable manner and without the chemicals now used, to be the most significant argument against there even being a real population or resource problem...but then, I bet you see different nails and have different hammers

...or perhaps you are implying that we have no chance, that the solution is less of everything for everyone...and less of everyone as well?

Bizarre as it may seem, I'd assert that this would only make matters worse.

Never underestimate their intelligence, always underestimate their knowledge.

Frank Delaney ~ Ireland

by siegestate (siegestate or beyondwarispeace.com) on Mon Jan 12th, 2009 at 03:46:49 PM EST
[ Parent ]
Sustainability doesn't require any sort of equality across the population, but I'd like to change the culture to something that isn't an exaggerated expression of human instinct which is where we are at today.

As a non-meat eater, I find that the capacity of the land to feed several times more people in a much more sustainable manner and without the chemicals now used, to be the most significant argument against there even being a real population or resource problem...but then, I bet you see different nails and have different hammers

Efficiency cannot be greater than 100% which means there is a hard limit on our population. We could probably string out 20 billion humans on a diet of 900 calories of rice and vegetables a day, but why? Shouldn't we be concerned about our collective quality of life?

you are the media you consume.

by MillMan (millguy at gmail) on Mon Jan 12th, 2009 at 09:07:27 PM EST
[ Parent ]
We could probably string out 20 billion humans on a diet of 90 of rice and vegetables a day, but why? Shouldn't we be concerned about our collective quality of life?
Alternatively, it's not clear that the current low density of population is actually sufficient to ensure a reasonable quality of life either.

I have this image in my head of a pre-historic hunter-gatherer who's worrying how future people can stand living in cities, with their crazy indoor plumbing and prepackaged food available in giant walk-in refrigerators etc.

--
$E(X_t|F_s) = X_s,\quad t > s$

by martingale on Mon Jan 12th, 2009 at 10:27:30 PM EST
[ Parent ]
While you philosophers and elitists argue, I'm going to do something positive for us all. I'm going to invest my money in Sustaining Stocks~!

New Mutual Fund will be First in US to Track Dow Jones Sustainability Index


Never underestimate their intelligence, always underestimate their knowledge.

Frank Delaney ~ Ireland

by siegestate (siegestate or beyondwarispeace.com) on Tue Jan 13th, 2009 at 02:29:16 AM EST
[ Parent ]
<sigh>

Most economists teach a theoretical framework that has been shown to be fundamentally useless. -- James K. Galbraith
by Migeru (migeru at eurotrib dot com) on Tue Jan 13th, 2009 at 02:34:54 AM EST
[ Parent ]
I understand your point, but going from today's 6.5 billion to 20 billion is beyond even my long term comments (and a diversion from discussion).

Meanwhile, just in average numbers, a unit of meat protein takes 7 times more water, 7 times more grain input, 7 times the land and creates (to use a technical term for it) a shitload of detritus, much of it not on the list of cool things to have around.

Now, I don't want to highjack this thread with a holistic rant, but it does have to do with world economics part 1. As I understand it, amino acids are amino acids, no difference between beef amino acids (and thereby, beef proteins) and vegetable amino acids (and thereby vegi-proteins.) But the stuff that comes along with modern beef production (hormones, pesticides, cutting out the bad parts instead of turning away the entire cow) and the stuff that comes along with eating beef proteins such as the great tasting fats and the cooked nitates that turn to nitrites, the aforementioned hormones and other exciting chemicals that come with the execution, the are causing cancer and other health issues that the collective pays for...a blot on our quality of life from the get-go.

I cannot extrapolate to 20 billion. Nor do I have the time to multiply out and prove that the amount of food that can be sustained without petroleum-based fertilizers is much higher than 900 calories per person well into the future. But the back of the napkin says that we can do better for everyone beyond - well beyond mere survival.

Never underestimate their intelligence, always underestimate their knowledge.

Frank Delaney ~ Ireland

by siegestate (siegestate or beyondwarispeace.com) on Tue Jan 13th, 2009 at 07:38:23 PM EST
[ Parent ]
There is still an upper bound on the number of humans that can be put on this planet.

you are the media you consume.

by MillMan (millguy at gmail) on Tue Jan 13th, 2009 at 07:47:53 PM EST
[ Parent ]
I spotted an absurd piece of hi-fi kit in John Lewis (a British department store chain) yesterday. It was a valve amplifier with an iPod dock, for audiophiles who are obsessed enough with sound quality to pay for a magic valve but are happy to play lossy compressed AAC files all the same...
by Gag Halfrunt on Mon Jan 12th, 2009 at 07:38:13 AM EST
There are actually well-doable hacks to play FLAC on your Ipod. If you have a large, hard-disk based Ipod, this does make some sense.
by GreatZamfir on Mon Jan 12th, 2009 at 07:58:27 AM EST
[ Parent ]
Only if you buy into all that Nyquist sampling junk in the first place. The only way to get true sound reproduction is to go analog all the way--preferably using a hand-crank phonograph.  :-)
by asdf on Mon Jan 12th, 2009 at 08:19:55 AM EST
[ Parent ]
No, no, what if your hand gets tired at the wrong moment? The only true way to listen to music is as Beethoven intended: read the score and imagine it!

--
$E(X_t|F_s) = X_s,\quad t > s$
by martingale on Mon Jan 12th, 2009 at 08:40:20 AM EST
[ Parent ]
Theres only one piece to play to properly apreciate this equipment.



Any idiot can face a crisis - it's day to day living that wears you out.

by ceebs (ceebs (at) eurotrib (dot) com) on Mon Jan 12th, 2009 at 09:18:28 AM EST
[ Parent ]
Good diary. however to miss the point entirely I must point out that I used to know a hi-fi freak and he once invited me around to listen to his (extremely expensive) sound system. Despite myself I was impressed with the quality of the sound, it had a presence I've not experienced even on my own rather expensive system (c £3,000).

but my major argument was that, in order to exercise and appreciate the system, he invariably chose to buy heavily over-produced mor soft rock that, imo, might as well have been played in elevators. I mean seriously, if you don't like music, why bother ?

keep to the Fen Causeway

by Helen (lareinagal at yahoo dot co dot uk) on Mon Jan 12th, 2009 at 08:50:18 AM EST
Which implies that martingale:
The only true way to listen to music is as Beethoven intended: read the score and imagine it!
 is not as absurd as it seems.  It is what the music evokes in you that is important...

notes from no w here
by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Mon Jan 12th, 2009 at 09:45:30 AM EST
[ Parent ]
Well, Beetoven was deaf when he composed the 9th, so clearly to him it was always imagined :-)

Most economists teach a theoretical framework that has been shown to be fundamentally useless. -- James K. Galbraith
by Migeru (migeru at eurotrib dot com) on Mon Jan 12th, 2009 at 09:47:22 AM EST
[ Parent ]
no need for the :-)  - it was a serious point - clearly Beethoven would have wanted to be able to hear his work performed - if only to criticise his interpretors - but actually being able to hear it in all its hifi glory was not a pre-condition for him to be able to write it, and neither should it be a precondition for us to be able to appreciate it.  The limiting factor is us, not the equipment.

notes from no w here
by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Mon Jan 12th, 2009 at 10:25:26 AM EST
[ Parent ]
Taking this seriously is a bit odd. You can only imagine sound when you have once heard it. Beethoven, by having been actively engaged in making music for much of his life, could probably play the score in his head the same way (but more elaborately than) you and I hear an irritating tune that unwantedly gets stuck in our heads.
by nanne (zwaerdenmaecker@gmail.com) on Mon Jan 12th, 2009 at 04:40:27 PM EST
[ Parent ]
If you study music properly learning to 'hear' what you're reading is part of the process. Some people get very good at it. I can follow a score, but I haven't had enough practice to do the sonic equivalent of visualising it completely.

It's a little different for composers because music of that period was constructed according to fairly rigid rules, and as long as a composer followed the rules something listenable would fall out.

Scores were more written rather than heard, if only because most people couldn't afford to keep a symphony orchestra or string quarter in the house. Usually a composer would try out lines or chord sequences on a piano or some other instrument to sketch out an outline, but the orchestration, elaboration and arrangement were all done on paper.

Doing everything mentally was a step, but for someone with thirty years of experience it wasn't as huge a step as it might seem.

by ThatBritGuy (thatbritguy (at) googlemail.com) on Mon Jan 12th, 2009 at 05:30:02 PM EST
[ Parent ]
Ah, but it's interpretation dear boy. you cna listne to a whole raft of recordings of any piece of scored music and they should all be different. Some to quite marked extents.

One recorded with instruments made to the same limitations as that of the era of the composer and recorded in a concert setting will be profoundly different from one with modern instrumentation in a controlled sound studio.

In rock, the studio and live environments are chalk and cheese, not least because of the visceral quality introduced by volume and social setting in the live environment.

It's the same music on paper, but the experience is another thing.

keep to the Fen Causeway

by Helen (lareinagal at yahoo dot co dot uk) on Mon Jan 12th, 2009 at 10:14:04 AM EST
[ Parent ]
yes but it is your ability and imagination to be able to experience it that is ultimately important - in the same way as an abstract painting or a poem can tell you more about yourself than about the creator.

notes from no w here
by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Mon Jan 12th, 2009 at 10:20:39 AM EST
[ Parent ]
On the other hand, I am an amateur musician (have been paid for participation in a marching band--which formally means I'm a professional!) and listen almost exclusively to classical music, but have for a sound system only an old Advent 300 receiver with one channel blown out, one Yamaha reference monitor, and an iPod adapter... Obviously I am making the best effort possible to keep the marketing of hi-fi equipment out of my life...  :-)

by asdf on Tue Jan 13th, 2009 at 09:39:24 AM EST
[ Parent ]
Are there any industries that thrive with minimal or no advertising (beyond word of mouth)?

Truth unfolds in time through a communal process.
by marco on Mon Jan 12th, 2009 at 09:39:48 AM EST
Apparently Ted Baker fashion stores don't advertise and rely on their salespeople and word of mouth...

notes from no w here
by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Mon Jan 12th, 2009 at 09:42:51 AM EST
[ Parent ]
Excellent question. Short answer, monopoly producer/distributers of food, energy, water -- staff of life.

Think about it.

Diversity is the key to economic and political evolution.

by Cat on Mon Jan 12th, 2009 at 12:51:57 PM EST
[ Parent ]
--I used to test hifi equipment for a consumer magazine (I did the technical part, the staff writer got the byline for the verbiage).

It was clear that once the initial problems with CD's were overcome by better low pass filtering there really was no place to go to improve the quality of the sound. Electronics equipment had become essentially noiseless and distortionless. The one area that remained in need of improvement (and still does) are the loudspeakers.

While people will argue over whether .001% distortion is better than .1% they continue to ignore the 1-10% distortion that come from loudspeakers.

Interestingly what has happened since then is that the goal of "perfect" music reproduction has been replaced by the desire for everywhere music reproduction. So the standard of reproduction, typically MP3 or the like, is actually worse than what was the norm 20 years ago. I now spend a good part of my time listening to an internet radio (through my hifi) and while the range of programs available is terrific the fidelity is truly mediocre.

I think most young people have never heard high quality music reproduction. Where would they? Even if you go to a "live" music event you will be hearing loudspeakers, electronically generated or altered sound and singers using amplification.

Whether this is a good thing or not, it means that there is no real market for high quality sound leaving the field open to charlatans. I remember an electric clock being offered that you plugged into the wall to "clean" the electricity going to your hifi. There are no limits to the human imagination when it comes to selling snake oil.

--The desire to be a peacock via conspicuous consumption is nothing new just look at "The Emperor's New Clothes" for a good treatment of the subject.

--Since I keep railing against materialism this thread might be a good jumping off point for a discussion of how people will validate their existence if they can't do it via "stuff". What will be the important values that they should adopt instead? This is important because we are running out of the raw materials to make the "stuff" out of so we need to find other goals in life.

Policies not Politics
---- Daily Landscape

by rdf (robert.feinman@gmail.com) on Mon Jan 12th, 2009 at 09:58:21 AM EST
--Since I keep railing against materialism this thread might be a good jumping off point for a discussion of how people will validate their existence if they can't do it via "stuff". What will be the important values that they should adopt instead? This is important because we are running out of the raw materials to make the "stuff" out of so we need to find other goals in life.

I think people validate their existance through status, and "stuff" is one of the ways to acquire status.

So, the question is how to have a competition for status that isn't resource-heavy. And, of course, since status is a psychosocial phenomenon there's no reason why status should cost the earth.

In fact, as less and less stuff becomes available people will be forced off "stuff" as a status market, and access to "stuff" (concentrated natural resources) will be the mark of the superwealthy.

Most economists teach a theoretical framework that has been shown to be fundamentally useless. -- James K. Galbraith

by Migeru (migeru at eurotrib dot com) on Mon Jan 12th, 2009 at 10:08:12 AM EST
[ Parent ]
Migeru:
In fact, as less and less stuff becomes available people will be forced off "stuff" as a status market, and access to "stuff" (concentrated natural resources) will be the mark of the superwealthy.

The problem is that the efficacy of "stuff" as a status differentiator is correlated with its scarcity.  If everyone can have it, it is no good for denoting relative status.  If it is exclusive to a few - whether the super wealthy, ruthless, talented, or lucky - then it has value as a status differentiator.

The fact that elephant tusks are getting scarcer just makes them more valuable.

notes from no w here

by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Mon Jan 12th, 2009 at 10:36:10 AM EST
[ Parent ]
Stuff, especially exotic pseudo-magical stuff, is a useful differentiator. But it's still some way down the totem pole.

There's more about that in Pt 2, as and when.

by ThatBritGuy (thatbritguy (at) googlemail.com) on Mon Jan 12th, 2009 at 11:27:42 AM EST
[ Parent ]
Well there is always this:



Policies not Politics
---- Daily Landscape

by rdf (robert.feinman@gmail.com) on Mon Jan 12th, 2009 at 11:59:46 AM EST
[ Parent ]
I don't think that people's desire for physical stuff is the real problem. The real problem is mass production, which requires mass marketing as a condition for its survival. Get rid of mass production, and you get rid of the need for a lot of marketing, which in turn gets rid of people's artificially inflated desire to consume products.

Current manufacturing processes are much too wasteful: if you want to build ten products, then you have to build a thousand - that's 99% waste, which is literally swept under the rug by convincing people who don't want it to store it in their basements.

Of course, rewinding the clock to the pre-industrial age is not an option (although it's always a danger as you point out). I believe the next step forward is better on-demand production. We're seeing the first baby steps with digital goods, on-demand production of CDs and books, etc.

What we need are more versatile robots, that can build a multiplicity of components from raw material. There are printers that can build 3D objects layer by layer from an engineering drawing - this is the kind of thing that's needed, but with a variety of types of material that can't be done today. It cuts out the need for factories that produce components - and in turn cuts out the need for all those surplus components to be actually stored and transported all over the world and used to produce more useless goods and marketed to people who store them in their basements. It also cuts out the need to mass produce a product to justify lower manufacturing prices.

Ideally, in the post-industrial on-demand society, you simply visit your local manufacturer and choose some products from a catalog, then pick them up a couple of days later after they've been built - all without the baggage of global trade and marketing.

--
$E(X_t|F_s) = X_s,\quad t > s$

by martingale on Mon Jan 12th, 2009 at 08:24:54 PM EST
[ Parent ]
Or you share stuff and work out a rota for using it.

There are twenty five houses in this village, and all of them (except mine, more or less) have their own lawn mowers.

It shouldn't be beyond the wit of everyone to arrange a time share of a single uber-mower. But the Law of Mojo forbids it, because formalised sharing of non-luxury property carries intense anti-mojo and is experienced as narcissistic wounding.

(Never mind that people could live, cook and eat together too - that's just crazy talk.)

by ThatBritGuy (thatbritguy (at) googlemail.com) on Tue Jan 13th, 2009 at 10:07:34 AM EST
[ Parent ]
Yeah, that sounds good, but how do you deal with the tragedy of the commons?

--
$E(X_t|F_s) = X_s,\quad t > s$
by martingale on Tue Jan 13th, 2009 at 10:53:22 PM EST
[ Parent ]
Piaget, "Realism and Idea of Participation", The Child's Conception of the World, (pp124 - 152) whence comes an axiomatic description of  psychology of ADD (Anglo diseased democracy) including the political economy of institutional controls, cultivated by those afflicted.

The child is a realist, since he supposes thought to be inseparable from its object, names from things named, and dreams to be external. His realism consists in a spontaneous and immediate tendancy to confuse the sign and the thing signified, internal and external, and the psychical and the physical.

The results of this realism are twofold. Firstly, the limits the child draws between the self and the external world are much less rigid than our own; secondly, the realism is further extended by 'participations' and spontaneous ideas of a magical nature. ...

It is possible to feel acutely the results of a mental process (logical reasoning or affective reasoning) without knowing how such a result came about. This is precisely the case with the child and is what is meant when the child's 'intuition' is spoken of; a true perception of the contents of consciousness but no knowledge of how these contents were acquired, such is the paradox of this 'intuition.'

This paradox is closely related to the following facts. The child may be aware of the same contents of though as ourselves but he locates them elsewhere. He situates in the world or in others what we seat within ourselves, and he situates in himself what we place in others. In this problem of the child's consciousness of self, and it is through not stating it clearly that what is in fact exceedingly complex is made to appear simple.  It is indeed possible to suppose a mind extremely sensitive to the least stirrings of the affective life, a keen observer of the niceties of language, customs and conduct in general, yet hardly conscious of his own self, since he systematically treats each of his thoughts as objective and every feeling as common to all. The consciousness of self arises in fact from the dissociation of reality as conceived by the primitive mind and not from association of particular contents. That the child shows a keen interest in himself, a logical, and no doubt a moral, egocentricity, does not prove that he is conscious of his self, but suggests, on the contrary, that he confuses his self with the universe, in other words that he is unconscious of his self. This is what we shall attempt to prove. ...

We shall use the term 'magic' for the use the individual believes he can make of such participation to modify reality. All magic supposes a participation, but the reverse is not true. ...

Narcissism, that is to say absolute egocentricity, certainly gives rise to magical conviction, but only in so far as it implies the absence of consciousness of self. The term 'solipsism' has been used in connection with infants: but the real solipsist does not feel that he is alone, and connot know his self for the simple reason that we only feel ourselves to be alone after others have left us and that he who has never had the idea of a possible plurality cannot have in the least degree the feeling of his individuality. Thus the solipsist probably feels himself identical with the images he perceives; he has no consciousness of his self, he is the world. We may speak of narcissim and maintain that the infant regards everything in terms of his own pleasure, but on condition that we remember that narcissism is accompanied by the most complete realism, in the sense that the infant can make no distinction between a self that commands and a not-self that obeys.

Boldface emphasis added.

Diversity is the key to economic and political evolution.

by Cat on Mon Jan 12th, 2009 at 11:32:59 AM EST
That's a pretty good description of how Sarkozy relates to the world...

"Dieu se rit des hommes qui se plaignent des conséquences alors qu'ils en chérissent les causes" Jacques-Bénigne Bossuet
by Melanchthon on Mon Jan 12th, 2009 at 02:24:19 PM EST
[ Parent ]
The same may be said about so many other politicians, given their actions, who persuade both like-minded, arrested adults and those who should know better to elect them to offices of public trust.

Diversity is the key to economic and political evolution.
by Cat on Tue Jan 13th, 2009 at 12:39:05 PM EST
[ Parent ]
"I'm the sort of person who is really free."

Hm.

by Colman (colman at eurotrib.com) on Mon Jan 12th, 2009 at 11:39:20 AM EST
Cor baby, that's really free

keep to the Fen Causeway
by Helen (lareinagal at yahoo dot co dot uk) on Mon Jan 12th, 2009 at 12:43:39 PM EST
[ Parent ]
Isn't marketing a great way to make products more sustainable? If you want to buy a 200.000 Euro status automobile, you can buy a hyped, partially hand made Aston Martin or a MAN truck.

The latter is mass produced, and has little budget wasted on advertisement. In some sense you get more value for money. But that also means its production has used more  non-renewable resources.

Mojo-adding marketing is a relatively clean way to add value to a product. An Ipod is cheap electronics plus buzz, in a similar way as a book is paper plus meaning.

by GreatZamfir on Mon Jan 12th, 2009 at 01:53:46 PM EST
Brilliant..

brit you are brilliant.

You have forgotten more anthropology that I have ever learnt...plus you know how to use it unlike me  :)

A pleasure

I therefore claim to show, not how men think in myths, but how myths operate in men's minds without their being aware of the fact. Levi-Strauss, Claude

by kcurie on Mon Jan 12th, 2009 at 03:54:52 PM EST
...buys organic food.

Most economists teach a theoretical framework that has been shown to be fundamentally useless. -- James K. Galbraith
by Migeru (migeru at eurotrib dot com) on Mon Jan 12th, 2009 at 04:12:26 PM EST
by nanne (zwaerdenmaecker@gmail.com) on Mon Jan 12th, 2009 at 04:46:06 PM EST
[ Parent ]
The commercial ads in the newly prescribed American digital TeeVee are in fact 20 decibels louder than the progammed material said peasants are attempting to watch.  This is further compounded by the proliferation of the push to emulate elite society scumbags through the possiblilty of your peasant possetion of such things as surround sound systems.  Yeah it might be wonderful except for the simple fact that all of the 900 channels of Satanically inspired socially destructive programming is routinely interrupted by commercial ads which do exhibit a 50 decibel volume increase over the programming said peasant proles are attempting to watch.  Such things prompt me to forgo the purchase of more electronic crap which only benefits the coporate elite who screwed me out of my 401K.  Actually not, I was and have been karmically connected enough as to have never invested in a 401.  Instead I bought fun toys to enhance my spiritual being and this has extended to the ones who love me.
by Lasthorseman on Mon Jan 12th, 2009 at 10:19:39 PM EST
I doubt that's intentional, and if so, it won't last, unfortunately: If ads are consistently 20db louder than programs, then it becomes entirely trivial to filter out all the ads shown on a TV channel, automatically and perfectly.

--
$E(X_t|F_s) = X_s,\quad t > s$
by martingale on Mon Jan 12th, 2009 at 10:32:02 PM EST
[ Parent ]
ROFL!

Most economists teach a theoretical framework that has been shown to be fundamentally useless. -- James K. Galbraith
by Migeru (migeru at eurotrib dot com) on Tue Jan 13th, 2009 at 02:32:57 AM EST
[ Parent ]
Boxes to do that already exist, and show a sad side of commercials: when given the choice between them and a black screen, people prefer the commercials
by GreatZamfir on Tue Jan 13th, 2009 at 03:09:23 AM EST
[ Parent ]
Or, if they prerecord the shows and filter out the ads, then they don't get black screens at all :)

--
$E(X_t|F_s) = X_s,\quad t > s$
by martingale on Tue Jan 13th, 2009 at 03:31:04 AM EST
[ Parent ]
Of course, but skipping the commercials in recordings is something people are already perfectly capable of. The slight benefit of having it done automatically is probably lost if the filter also accidentally blocks some parts of the regular show.

But now that hard-disk recording is on the rise, and you can watch ashow that is still getting taped, software ad blockers might become popular. Then again, hwo many people do you know that install ad blockers on their browser?

by GreatZamfir on Tue Jan 13th, 2009 at 04:09:45 AM EST
[ Parent ]
That's why a consistent ad volume increase can't last, as it lowers the likelihood of software misidentifying ad sections (although there are many tricks used to identify ads, and obviously this won't affect filters which don't use volume as a heuristic).

If they want to beat statistical classifiers, what advertisers really need in the long run is for their ads to blend seamlessly into the show, and that really only works if they can match both the statistics of the soundtrack and the colour statistics of the video. That's pretty much hopeless for general purpose ads - they really would have to be built with a particular show (series) in mind, maybe have the same actors plug the products like in the 50s.

All the people I know use ad blockers, except me. I've been using a text browser (w3m) for years, and have never needed one.

--
$E(X_t|F_s) = X_s,\quad t > s$

by martingale on Tue Jan 13th, 2009 at 04:41:07 AM EST
[ Parent ]
Many, if not most, point-and-click browsers have ad-blocking features enabled by default. Turning them off can be an enlightening, if unpleasant, experience...

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Tue Jan 13th, 2009 at 06:39:20 AM EST
[ Parent ]
3 dB =  doubling in volume. 6 dB is the average increase in apparent volume used by TV ads that have been processed using a plug-in such as Ultramaximiser. It uses look-ahead brickwall peak limiting and level maximization (an algorythmic type of compression). At around 9dB the compression has audibly removed the dynamics of the track.

You can't be me, I'm taken
by Sven Triloqvist on Tue Jan 13th, 2009 at 03:46:33 AM EST
[ Parent ]
3dB is a doubling in the pressure differential in the sound wave. The human hearing system is equipped with logarithmic compression, which increases dynamic range. The effect of this is that each doubling in pressure, and therefore energy, is perceived as a step in a linear scale. A 3dB increase in not heard as a doubling in volume. Pitch (sound frequency) works there same way. An octave shift is a doubling (or halfing) in frequency, but each octave is heard as a step in a linear scale.
by someone (s0me1smail(a)gmail(d)com) on Tue Jan 13th, 2009 at 04:18:40 AM EST
[ Parent ]
Ahrghg. 3dB is a doubling of sound pressure differential squared (proportional to sound energy as we would expect). Thus 3dB is a factor of √¯2(1.414...) in pressure.
by someone (s0me1smail(a)gmail(d)com) on Tue Jan 13th, 2009 at 09:04:44 AM EST
[ Parent ]
i know, I know ;-)

All I know is how to use and misuse the damn things.

You can't be me, I'm taken

by Sven Triloqvist on Tue Jan 13th, 2009 at 10:46:33 AM EST
[ Parent ]
I think what is really being marketed is the scarcity of a product or service. "Everybody" wants a Ferrari because so few can have one, for example.

This does not have to take the form of EXPENSIVE conspicuous consumption, because scarcity can be accomplished in minimalist consumption cases, too. A couple of examples from my location:

- The Shambhala Mountain Buddhist organization in northern Colorado offers a variety of meditation retreats. You go there, you meditate, sleep, and eat. Period. Hardly any socializing except at meals. But it's pretty expensive; around $1000 per week to do something you could do for free at home.
http://www.shambhalamountain.org/

- The Western Jubilee Warehouse in Colorado Springs is a small recording studio that caters to acoustic western music artists. (Not "country and western" but "western", which is old-timey and suffers minimal "production.") To attend their shows you have to be invited by the band; there are no public concerts or big marketing campaigns--in fact, most people in town don't even know it exists. The value proposition is scarcity.
http://www.westernjubilee.com/index.htm

by asdf on Tue Jan 13th, 2009 at 09:58:43 AM EST
"Everybody" wants a Ferrari because so few can have one, for example

It seems to me these examples do a good job illustrating one way an advertiser cultivates the perceived value of a good or service among consumers in order to differentiate its client within an industry. (My favorite example is comparison of toothbrushes, say, Oral B versus P&G across competitors for market share and the cannibalistic tendancies across units within each company.)

Exclusivity of the offering, rather than the scarcity of its material components, translates to a premium (e.g. value-added, fair value, margin) appended to the cost of its production --including highly skilled labor, as in the case of Ferrari or Porsche and BMW for that matter, all of which are distinguished within the industry from "mass producers" by being niche producers.

Such manufactures optimize "consumer choice" theory (reinforced by advertising) according to "preferences" associated with a group of characteristics, namely disposable income, but also with greater frequency ever so droll, purchase patterns of complementary goods and services statistically correlated to income. ("You might like ..."; "People who bought X also ...") The predictive power of price elasticity cannot be understated however.

Unlike a price mechanism (S/D) postulated by fungible commodity clearing, the niche manufacturer's suggested retail price (MSRP) determines demand. And the premium engrossed by it poses no limitation to what a "status conscious" buyer is either willing or able to pay for the "privilege" of yoga practice or driving an automobile or personal grooming. In a saturated market the producer will NOT increase production (this would defeat the "value" of exclusivity) but will simply increase premium in order to qualify new profitable clients.

A hilarious discursion on "Causes of Luxury Goods MARKET COLLAPSE: M&A Dilution or Savings Glut?" is worth pursuing. Some other time.

Diversity is the key to economic and political evolution.

by Cat on Tue Jan 13th, 2009 at 02:00:13 PM EST
[ Parent ]
Bloomberg staffers join Paul Roberts: This morning's headlines, in particular, altogether illustrate opprobium of the press. With respect to the perceived value of exclusivity,

Paulson's Georgia Investment Rises as Blind Trust Becomes Joke | Bloomberg | 14 Jan 2009

Paulson and his wife, Wendy, paid $32.65 million to accrue a majority stake in Little St. Simons Island since 2003, county records show. Property values in the area have risen about 10 percent in five years, said Ann McCann of Sea Palms Realty Inc.

The island has five cabins that rent for $600 to $1,200 a night. Occupancy remains about 70 percent, even with the recession, said Joel Meyer, general manager. [compared to 'mass market' accommo] U.S. hotel occupancy fell 5.6 percent in the fourth quarter to 49.6 percent, according to Smith Travel Research in Hendersonville, Tennessee. ...

"It's heaven on earth," said Byron Brown, 57, an Atlanta advertising executive who with a group of friends has rented the entire island for visits of several days during the past 15 years. "It's the most peaceful, serene place I've ever been to. How do you put a price tag on that?"

A full-island rental costs $8,000 a night. Only 30 guests can be accommodated, so the cabins often sell out months in advance, Meyer said. The business about breaks even, with rental revenue covering the cost of year-round staffing, he said. No new development is allowed on the 10,500-acre (4,200-hectare) island, which is designated an "important bird area" by the National Audubon Society.

NB. 100% occupancy, 48 weeks x $8K "island rental," or $384K p.a., is the estimated total operating cost of this hospitality venture.

Little St. Simons has a conservation easement that reduces taxes in exchange for not developing the land, which locks the assessed value at $3.75 million for 10 years, said Bobby Gerhardt, Glynn County appraiser. ...

he Paulsons own three-fourths of Little St. Simons through Whimbrel LLC, a holding company named for a migrating shorebird. Paulson's disclosure forms for 2007 valued his half-interest in Whimbrel at $5 million to $25 million, and his wife owns the other half.

Pencil Maker

The rest of the island [25%] belongs to descendents of Philip Berolzheimer, an Eagle Pencil Co. executive who bought the land almost a century ago.



Diversity is the key to economic and political evolution.
by Cat on Wed Jan 14th, 2009 at 10:33:30 AM EST
[ Parent ]
Sorry. I misread that 'graph: $8K/night, not $8K/week. $2,688,000 p.a. total estimated operating cost, leading me to wonder, How Whimbrel LLC pays the property tax? Perhaps amenties such as meals and staff seminars are billed to guests additionally? Bwah!

Diversity is the key to economic and political evolution.
by Cat on Wed Jan 14th, 2009 at 12:51:39 PM EST
[ Parent ]


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