1970s car loans were two years, sometimes three. Today they are five to six years.
When interest rates are high, you can invest very little additional and pay off your debts much more quickly. When they are low, you are trapped in the common--often long--term.
Take a house for example. A $425,000 house will have a sale price tag of $310,000 at 2.5% interest. With $10k down, you pay a 30 year loan off at roughly $1180/mo totaling $426k, and a 10 year loan off at roughly $2820/mo totaling roughly $340k. It will have a sale price tag of $110,000 at 14% interest. With $10k down, you pay a 30 year loan off at roughly $1180/mo totaling $426k, and a 10 year loan off at roughly $1550/mo totaling $186k.
There is a two stage progression to this. First, people are comfortable with indefinite loans--they expect to buy a new car every 5 years, they get 5 year loans, this is okay. Second, they are comfortable with a base payment amount--$200/mo, $500/mo, whatever it is. This will dictate the style of car or house or condo they purchase on these terms.
The ability to escape debt is immensely attractive. Being satisfied, people will, for a limited expense and a minimal return, seek to improve their situation. A person paying $1000/mo may see no value in paying $1000/mo extra to cut 15 years from a 30 year loan; he will, however see value in turning the loan to 15 years. If he must only pay $200/mo to cut that term to 15 years, this will prove much more attractive. Thus the ability to pay slightly more and pay off the loan much faster appeals to people, and will result in shorter loan terms.
After this, people become comfortable with shorter loan terms. They then become uncomfortable again with the expense: this $1500/mo thing isn't a thing most people want to be in for, and a 30 year mortgage when more than half the population is enjoying the prosperity and security of being debt-free by 35 and having that $1500/mo free for savings or luxury is distasteful. Again people will seek their low $1000/mo payments, or perhaps settle for something in between: they no longer tolerate $1500/mo, but perhaps instead of forcing the price to $1000/mo they find something such as $1200/mo tolerable. Prices are eventually pressured down.
Eventually a loan term and price balance are reached. Mortgages used to be 5-10 years before FDR, with high mortgage rates. The banks don't really mind, because they bring in about half as much money in a third of the time--they can profit 50% more per loan volume over time, just they move from host to host instead of shoving their blood tentacle down one's throat for his whole life. They do attempt to profit more by offering high savings rates (3.5% instead of 0.035%), attracting depositors--rates of 14% would realistically only come if Fed loans were around 12%, so loaning depositor money is better. By contrast, a sick housing bubble pushes savings rates up rapidly to attract more depositors so that more loans can be made by fractioning more federal credit.
Don't just consider price for financed purchases. Consider not only price, but term and, as well, interest paid over the term.
8% is not a huge move? If we taxed everyone 8% and redistributed it to everyone over age 18, we would give everyone over $4500/year.
To make your comparisons valid, you have to amortize the expense as you've said. What do people pay for a car? Mostly we consider transportation--the car, fuel, maintenance, insurance--as a whole.
Stock market is a zero-sum game (wealth transfer vehicle).
Economy is not a zero-sum game (you can definitely destroy things, so you can definitely create things).
Most people somehow think that the stock market is the economy, and that the stock market reflects actual business performance. We live in a world of ignorance and bullshit.
Fact: Polycarbonate is made using bisphenol. BPS leeches much more than BPA. BPA-Free polycarbonate uses BPS, so banning BPA will expose us to greater toxins. Enjoy your toxic non-BPA baby bottles.
It's not really unfortunate for those taking the risk many times; it is marginally unfortunate for one-offs, but this is less of an issue than it seems.
Many, many individuals purchase computers, watches, or houses. They purchase cars. They purchase all manner of things which they may insure. At the same time, we have companies with fleets of antiques, rental units, and automobiles. This gives us a large and robust risk leveling base.
It is unfortunate that law requires liability insurance for vehicles. A large taxi or trucking corporation has financial resources to manage this risk and, in fact, many countries in Europe mandate that capital funds be held by a company to match the expenditures associated with calculated and understood risks such as the inevitability of liability in vehicular collisions. Were we to allow large corporations to manage their own risk, they would incur less expense by avoiding insurance costs; while individuals, sans documented funds for liability coverage, would still require insurance.
In the prescribed situation, the large fleet insurance represents a somewhat different risk than individual liability. Further, removing the large fleet leaves a huge individual liability risk--and many insured drivers amongst which to balance that risk. The impact would be negligible, likely to the point that insurance companies would find no compelling reason to adjust rates. At the same time, large companies would be required to maintain risk protocols and funds to cover risk events, either showing insurance or showing funds to cover said risks--meaning they could opt out of insurance and potentially save quite a bit of money, which itself could move into driver improvement programs to keep risk low and increase the savings by reducing the risk.
Because of this, I do not see why you would feel the situation is unfortunate. Perhaps you misunderstand: it is expensive to deal with a single isolated risk event; insurance cuts that risk down by distributing the marginal cost of risk. If you have 100 people and 2 of them are likely to incur a cost of $100, then you distribute $200 amongst 100 people and charge everyone $2. Everyone has now spent $2 to ensure that they are not subject to $100. When you are one person with 100 chances to incur a cost of $100 with a probability of 2%, you will likely incur a cost of $200; to purchase $200 of insurance gains you nothing, and you are better off guarding against this inevitability by putting $200 under a pillow.
BPA is harmless. It's toxic at levels far above normal intake and concentration in the blood. BPA-Free polycarbonate now uses BPS, which is exactly as toxic as BPA but leaches at a rate 20 times that of BPA. It breaks the toxicity barrier with gusto, so enjoy your new toxic world.
Water bottles are most often PET or LDPE. These plastics aren't made with BPA or any analog.
There's an old saying: We enshrined freedom of religion, not freedom from religion, as a core civil right.
The Pledge of Allegiance is not a law. It is not covered under any constitutional law any more than, say, a court house displaying a statue of the tablets etched with the Ten Commandments in its front lawn. It would, in fact, be unconstitutional for Congress to make law forbidding a Federal or State institution from religious demonstration made at the discretion of staff with such administrative authority granted to make any such action involved in such demonstration. It would also be illegal for Congress to legislate the presence or absence of religious phrases in the Pledge of Allegiance.
The proposed Pledge Protection Act would be itself unconstitutional for other reasons. As well, the Supreme Court once incorrectly ruled that school students could be compelled to swear the Pledge; this is a thing I took against as a small child, to the dismay of my parents, when I realized in fifth or sixth grade that the Pledge was a swearing that one would accept all acts of Country as good. Having never understood the concept of service to a country or fanatic patriotism, it seemed to me an affront.
The parameters described were purchasing insurance for a bulk event that has a cost. Insurance increases the cost by the probability of a risk multiplied by the cost of the risk, plus overhead.
These people are talking about not purchasing liability insurance for a one-off. A one-off is exactly the correct time to purchase insurance: You represent a small fraction of the risk pool, and so you derive the greatest benefit for the smallest cost. As you begin to represent a larger portion of the risk pool--as you have to insure repeatedly (hundreds of actions, hundreds of items, hundreds of potential claims), the cost of insurance outweighs the probable loss, and the amount of actual loss can more accurately be predicted with higher confidence.
Doing it once? Get insurance. Doing it a thousand times? Don't get insurance.
We have Chief Risk Officers and Chief Financial Officers for a reason. They can come to immediate agreement about why we should or should not have insurance on a case-by-case basis.
The point of contention is college students coming out into the field with no ability to get any job, and/or eventually getting something they're unsuited for.
Beyond that, it makes a sort of economic sense that time spent acquiring useless skills is time wasted, and that economic activity spent on this wasted time makes the world poorer. If you get a biology degree and become a programmer of physics simulators, you have (in most cases, unless biology becomes a significant personal hobby) wasted a great deal of time and money studying biology. You should have studied programming, making yourself more viable for the field you landed in, allowing you to produce good results and move through the field more quickly, and thus maximizing the return on your educational investment.
Consider that a mismatched degree is, effectively, a glorified high school diploma. In my high school I learned calculus, statistics, programming, networking (full CCNA course), physics, and chemistry up to and including the basic quantum physics associated with electron orbitals and probabilistic subatomic state that's not taught until the third or fourth semester of dedicated chemistry study in college. The general education requirements for any oddball college degree are slightly--just slightly--beyond my public school education. I am engaged in dedicated study of writing and mathematics because of this deficiency. Specialist study--your core program classes--are not generally useful and, baring corner cases of tangential usefulness, are a complete waste when you land in a specialist field which does not utilize said skills.
Assembling these two facts, we realize that college degrees are worthless when missing your field. College degrees may have implied value, but the above estimates that they are overbought: the value attributed to college degrees is not real, and a BA in Management doesn't help you with Biology or Programming, etc. The value of a specially-trained specialist (through apprenticeship etc.) is much higher.
We can argue for education, but the current system causes many problems and supplies no benefits; I do favor broader general education and some changes to the education system as a whole, but my plans lead into direct and immediate class separation which bothers people. Interestingly, we already engage in class separation: I was, of course, a top-tier student labeled as Gifted and Talented, a step above Honors students, who are a cut above your regular crop, who are of course a better class than Special Education students. My GPA was damn near 16, while regular kids couldn't get above a 4.0.
More to the point, this inadvertently directed repair crews to wealthier neighborhoods. Typically, repair crews are intentionally directed to wealthier neighborhoods.
I have damn good negotiation skills compared to the average man, but not to the professional. I'm trying to improve these in a number of ways--better study, better writing, public speaking training from lawyers. But the result of my menial advantage is obvious: I can call the city and make them do things for me for free.
12 years a burned down house rots, 5 years the neighbors rail at the city to remove it, a neighborhood coalition is ignored. I made five phone calls to people I have no connection to, found that the house is not scheduled for demolition, instructed them to send an inspector and to instruct him to find certain aspects of the house as faults justifying its immediate demolition, and the house is demolished two months later. They even made repairs to my house and upgraded my finished brick wall to a block-and-cement wall free of charge. I'll purchase the extra 2400 square foot lot for $1000 and amend it to my yard.
12 years, and the neighborhood is now more poor than it was back then. Homeowners moved out, houses were left to rot, some burned down, a few became rental property. I pay my $71/year in taxes, and I talk the city into removing an eyesore at likely $5000 of their own expense. The neighbors think me a hero.
Even a Bene Gesseritt witch would heed my command, for a moment of consideration at least.
Let's say you buy a computer, and you buy insurance in case that computer burns out. Is this a good decision?
How about if you buy 10,000 computers for a company, and you buy insurance in case those burn out. Is that a good decision?
In the first case, yes. You have one computer. You are exposed to either the marginal cost of a computer some percentage of the time OR slightly more than that percentage of the marginal cost of the computer 100% of the time. Let's say 1 in 100 computers burns out in a short life--1% risk probability--for a $1000 computer. You face a 1% chance of losing $1000; or you pay somewhere above but close to $10--let's call it $12.50--and face a 100% chance of losing exactly $12.50.
In the second case, you own 10,000 of these. You face a damn near 100% chance of losing 100 of them, at a marginal cost of $100,000. Of the replacements, you'll probably lose 1 more, adding $1000. Thus your costs are $101,000. For insurance, you're adding $12.50 per computer, providing a guaranteed loss of $125,000. This puts you $24,000 behind--you should forgo insurance.
Why is this?
In the first case, your total cost is low: you have one object and are exposed to a very low, but very severe margin of risk. It's unpredictable, and will be significantly costly. For some very small marginal cost, you can avert this risk.
In the second case, your total cost is high: you have many objects and are exposed to a very low margin of risk, but one that is now a fraction of your initial cost. Likewise, the risk is repeated across many things--failure is isolated and your system is robust.
In the first case, your experienced risk is many, many times higher the marginal cost of insurance: $1000 versus $12.50. In the second case, however, your experienced risk is almost guaranteed to be $10 per machine, and so you're going to pay an extra $2.50 for an extremely unlikely event--you're overpaying for risk mitigation. Your risk is spread wide and predictable, and the cost estimates of $101,000 versus $125,000 show that you're now paying more for protection than the failure event will probably cost you.
Ignoring that this project doesn't generate profit (and thus can't act as its own source of liability mitigation), what we're looking at is the risk of an extremely expensive one-off failure. If you have a 1 in 50,000 chance of hitting a $1M satellite, then you would be appropriately insured by a policy of about $20. Foregoing that insurance puts you at a $1M risk. On the other hand, if you were to do this substantially more than 50,000 times and each time profited you more than $20, it would be highly likely that you would incur a $1M liability occasionally BUT it would be more expensive to purchase insurance than to simply accept the occasional cost of liability.
This project is a prime candidate for liability insurance. Purchasing liability insurance is a good decision, even if nothing bad happens. Purchasing liability insurance with parameters as described above is a bad decision--even if you're unlucky, not purchasing it is usually a good decision (unless risk appetite is extremely low).
Strawman argument - do you think Chevy pays for every Chevy dealership?
Of course not. They simply need to supply a single-supplier product which can make a middleman money. As-is, Tesla, like other small car manufacturers, cannot supply enough volume movement to sustain a middleman business model, although they can sustain themselves via a direct sales model.
Until Tesla is an established, powerful car manufacturer able to control a significant amount of the market, they can't supply the volume sales to make a middleman strategy viable.
because they were unwilling to let a "middle-man" get a cut of the action.
Imagine if Best Buy sold only TVs.
Imagine if Best Buy sold only Sony TVs.
Imagine if Sony only sold three models of TV, in LCD with 39 inch, 49 inch, and 59 inch.
Now imagine that Sony sells 24,000 TVs in 3 years.
How long do you think Best Buy, with 4000 locations in 48 states, selling only Sony Televisions and no other products at all, is going to stay in business?
That's how a dealership works. Chevrolet-GMC? General Motors owns both. Ford-Lincoln-Mercury? Toyota-Lexus? Guess who owns the Lincoln and Mercury brands? Guess who owns the Lexus brand? So we're talking about independent Tesla dealers who would have operating costs far outstripping their income from sales volume *unless* Tesla could control a large chunk of the market.
It's a model that only works if you have large, strong monopolies; and it only allows you to compete if you are a large, strong monopoly.
College is a speculative market. When a job field is understaffed, demand increases. Salaries go up, and barriers to entry are minimal--know something about computers? YOU'RE HIRED, KID!
Work field entrants in this system will naturally seek to maximize their potential by selecting a career compatible with their self-perceived interests and abilities, but largely weighted toward profitability and stability. This is why we mock art students so hard: they dive right into art school with no career plan, come out with a degree in Greek Mythology with a minor in Sculpting Minotaur Penises, and... then what? (Photography and fabric students often do have a solid career path--let's face it, they both go straight to Vogue, and you wish you could get that job.) They weight for their interests and abilities too heavily, and not enough toward a critical examination of viability; we feel superior because we've made intelligent, rational decisions about our career paths.
This becomes an issue of the Prisoner's Dilemma: there are 100,000 jobs for X and 500,000 students; optimally, you want roughly 100,000 of you to study for X and the other 400,000 to study other fields which collectively supply 400,000 jobs. Unfortunately, this is not coordinated *and* there is a knowledge deficiency: the field is growing, may grow faster or slower or shrink in 4 years, and you get on your degree path and come into a world with 350,000 X jobs or 20,000 X jobs or the same 100,000 X jobs and they're all filled. Ignoring that, you and 500,000 students come out looking for job X, with the relevant degree, and 400,000 of you can go fuck off somewhere.
Trying to flip that around so anyone can be hired for any job and the successful can then go on to college doesn't sound like a very workable solution.
I advise you to read Victor Harris' translation of Go Rin no Sho, by Miyomoto Musashi. The Book of Five Rings talks in the beginning about carpentry, about foremen, about wood and laborers. It points out that unskilled laborers can provide good labor: why should a highly-skilled and valuable carpenter spend hours cutting wedges when he could be carving intricate designs into expensive furniture? An unskilled laborer cutting wedges and shims will develop manual coordination and a good eye for measuring shims; he can then cut and lay floor joists effectively, and eventually will develop skills to lay and plane floor boards, to build furniture, and eventually to finish furniture and doors with carved designs. In the interim, he is useful for keeping skilled workers doing those things instead of cutting wedges.
Imagine hiring a data entry or formatting clerk. We hire unskilled temp workers to type bullshit into systems all the time, and to take piles of documents and pick them apart and assemble reports based on simple criteria that a trained monkey can follow. This occasionally gets passed to me because I'll take output from various programs, from Excel, Word documents, and so on and homoginize it with sed, awk, and grep. The homoginized data is then readily transformed, searched, sorted, and assembled by the skilled application of computer programming. I find sed, awk, grep, and some bash utilities extremely limited yet extremely suited for these tasks--unlike full languages such as Perl or Python, which are greatly useful for heavily repeatable tasks but not as useful for immediately defining a set of complex data transformations.
Imagine that your clerk is doing such menial tasks for accounting or finance, or for whatever reason. Importing data for sorting and searching to test a new computer system, or migrating data from one to another. He shows some promise and becomes familiar with the tasks at hand, so you send him to get educated in computer programming, system administration, accounting, or whatever set of relevant skills you feel would improve his viability to the company. Your company is growing, and perhaps you acquire two or three
Almost everything you mention here involves internal combustion engines.
Oh okay, so because it doesn't have an internal combustion engine, it's immune to all kinds of discrete part flaws and integration flaws that don't lend themselves to prediction and don't crop up in minimal testing. Got it.
Which is their own fault/problem, not a fault of the system under which cars have been sold in this country for decades, with the exception of Ohio's recent attempt to specifically outlaw the sale of Tesla automobiles (a dumb and unconstitutional move, IMO).
It's their own fault that they're not a 30-year established company with multi-billion-dollar income able to support tens of thousands of dealerships all over the country in convenient locations for the consumer? Come on, there's 24,000 Teslas on the road. There's almost 4000 Ford dealers. Each Tesla dealer would have claim to, what, 6 sales?
Have you ever wondered why every small auto manuafcturer--Tucker, AMC, etc.--in the US has failed or been bought up by the big three?
Slashdot Mirror
The economy will be in a much better shape when rates go back up.
1970s car loans were two years, sometimes three. Today they are five to six years.
When interest rates are high, you can invest very little additional and pay off your debts much more quickly. When they are low, you are trapped in the common--often long--term.
Take a house for example. A $425,000 house will have a sale price tag of $310,000 at 2.5% interest. With $10k down, you pay a 30 year loan off at roughly $1180/mo totaling $426k, and a 10 year loan off at roughly $2820/mo totaling roughly $340k. It will have a sale price tag of $110,000 at 14% interest. With $10k down, you pay a 30 year loan off at roughly $1180/mo totaling $426k, and a 10 year loan off at roughly $1550/mo totaling $186k.
There is a two stage progression to this. First, people are comfortable with indefinite loans--they expect to buy a new car every 5 years, they get 5 year loans, this is okay. Second, they are comfortable with a base payment amount--$200/mo, $500/mo, whatever it is. This will dictate the style of car or house or condo they purchase on these terms.
The ability to escape debt is immensely attractive. Being satisfied, people will, for a limited expense and a minimal return, seek to improve their situation. A person paying $1000/mo may see no value in paying $1000/mo extra to cut 15 years from a 30 year loan; he will, however see value in turning the loan to 15 years. If he must only pay $200/mo to cut that term to 15 years, this will prove much more attractive. Thus the ability to pay slightly more and pay off the loan much faster appeals to people, and will result in shorter loan terms.
After this, people become comfortable with shorter loan terms. They then become uncomfortable again with the expense: this $1500/mo thing isn't a thing most people want to be in for, and a 30 year mortgage when more than half the population is enjoying the prosperity and security of being debt-free by 35 and having that $1500/mo free for savings or luxury is distasteful. Again people will seek their low $1000/mo payments, or perhaps settle for something in between: they no longer tolerate $1500/mo, but perhaps instead of forcing the price to $1000/mo they find something such as $1200/mo tolerable. Prices are eventually pressured down.
Eventually a loan term and price balance are reached. Mortgages used to be 5-10 years before FDR, with high mortgage rates. The banks don't really mind, because they bring in about half as much money in a third of the time--they can profit 50% more per loan volume over time, just they move from host to host instead of shoving their blood tentacle down one's throat for his whole life. They do attempt to profit more by offering high savings rates (3.5% instead of 0.035%), attracting depositors--rates of 14% would realistically only come if Fed loans were around 12%, so loaning depositor money is better. By contrast, a sick housing bubble pushes savings rates up rapidly to attract more depositors so that more loans can be made by fractioning more federal credit.
Don't just consider price for financed purchases. Consider not only price, but term and, as well, interest paid over the term.
8% is not a huge move? If we taxed everyone 8% and redistributed it to everyone over age 18, we would give everyone over $4500/year.
To make your comparisons valid, you have to amortize the expense as you've said. What do people pay for a car? Mostly we consider transportation--the car, fuel, maintenance, insurance--as a whole.
Stock market is a zero-sum game (wealth transfer vehicle).
Economy is not a zero-sum game (you can definitely destroy things, so you can definitely create things).
Most people somehow think that the stock market is the economy, and that the stock market reflects actual business performance. We live in a world of ignorance and bullshit.
Fact: Polycarbonate is made using bisphenol. BPS leeches much more than BPA. BPA-Free polycarbonate uses BPS, so banning BPA will expose us to greater toxins. Enjoy your toxic non-BPA baby bottles.
It's not really unfortunate for those taking the risk many times; it is marginally unfortunate for one-offs, but this is less of an issue than it seems.
Many, many individuals purchase computers, watches, or houses. They purchase cars. They purchase all manner of things which they may insure. At the same time, we have companies with fleets of antiques, rental units, and automobiles. This gives us a large and robust risk leveling base.
It is unfortunate that law requires liability insurance for vehicles. A large taxi or trucking corporation has financial resources to manage this risk and, in fact, many countries in Europe mandate that capital funds be held by a company to match the expenditures associated with calculated and understood risks such as the inevitability of liability in vehicular collisions. Were we to allow large corporations to manage their own risk, they would incur less expense by avoiding insurance costs; while individuals, sans documented funds for liability coverage, would still require insurance.
In the prescribed situation, the large fleet insurance represents a somewhat different risk than individual liability. Further, removing the large fleet leaves a huge individual liability risk--and many insured drivers amongst which to balance that risk. The impact would be negligible, likely to the point that insurance companies would find no compelling reason to adjust rates. At the same time, large companies would be required to maintain risk protocols and funds to cover risk events, either showing insurance or showing funds to cover said risks--meaning they could opt out of insurance and potentially save quite a bit of money, which itself could move into driver improvement programs to keep risk low and increase the savings by reducing the risk.
Because of this, I do not see why you would feel the situation is unfortunate. Perhaps you misunderstand: it is expensive to deal with a single isolated risk event; insurance cuts that risk down by distributing the marginal cost of risk. If you have 100 people and 2 of them are likely to incur a cost of $100, then you distribute $200 amongst 100 people and charge everyone $2. Everyone has now spent $2 to ensure that they are not subject to $100. When you are one person with 100 chances to incur a cost of $100 with a probability of 2%, you will likely incur a cost of $200; to purchase $200 of insurance gains you nothing, and you are better off guarding against this inevitability by putting $200 under a pillow.
I am so glad I don't have a reverse-osmosis system. Besides the 95% water waste, it removes all the good stuff from the water. Horrible stuff.
Statistical comparison of many samples and normalization for confounding factors.
BPA is harmless. It's toxic at levels far above normal intake and concentration in the blood. BPA-Free polycarbonate now uses BPS, which is exactly as toxic as BPA but leaches at a rate 20 times that of BPA. It breaks the toxicity barrier with gusto, so enjoy your new toxic world.
Water bottles are most often PET or LDPE. These plastics aren't made with BPA or any analog.
There's an old saying: We enshrined freedom of religion, not freedom from religion, as a core civil right.
The Pledge of Allegiance is not a law. It is not covered under any constitutional law any more than, say, a court house displaying a statue of the tablets etched with the Ten Commandments in its front lawn. It would, in fact, be unconstitutional for Congress to make law forbidding a Federal or State institution from religious demonstration made at the discretion of staff with such administrative authority granted to make any such action involved in such demonstration. It would also be illegal for Congress to legislate the presence or absence of religious phrases in the Pledge of Allegiance.
The proposed Pledge Protection Act would be itself unconstitutional for other reasons. As well, the Supreme Court once incorrectly ruled that school students could be compelled to swear the Pledge; this is a thing I took against as a small child, to the dismay of my parents, when I realized in fifth or sixth grade that the Pledge was a swearing that one would accept all acts of Country as good. Having never understood the concept of service to a country or fanatic patriotism, it seemed to me an affront.
The parameters described were purchasing insurance for a bulk event that has a cost. Insurance increases the cost by the probability of a risk multiplied by the cost of the risk, plus overhead.
These people are talking about not purchasing liability insurance for a one-off. A one-off is exactly the correct time to purchase insurance: You represent a small fraction of the risk pool, and so you derive the greatest benefit for the smallest cost. As you begin to represent a larger portion of the risk pool--as you have to insure repeatedly (hundreds of actions, hundreds of items, hundreds of potential claims), the cost of insurance outweighs the probable loss, and the amount of actual loss can more accurately be predicted with higher confidence.
Doing it once? Get insurance. Doing it a thousand times? Don't get insurance.
We have Chief Risk Officers and Chief Financial Officers for a reason. They can come to immediate agreement about why we should or should not have insurance on a case-by-case basis.
The point of contention is college students coming out into the field with no ability to get any job, and/or eventually getting something they're unsuited for.
Beyond that, it makes a sort of economic sense that time spent acquiring useless skills is time wasted, and that economic activity spent on this wasted time makes the world poorer. If you get a biology degree and become a programmer of physics simulators, you have (in most cases, unless biology becomes a significant personal hobby) wasted a great deal of time and money studying biology. You should have studied programming, making yourself more viable for the field you landed in, allowing you to produce good results and move through the field more quickly, and thus maximizing the return on your educational investment.
Consider that a mismatched degree is, effectively, a glorified high school diploma. In my high school I learned calculus, statistics, programming, networking (full CCNA course), physics, and chemistry up to and including the basic quantum physics associated with electron orbitals and probabilistic subatomic state that's not taught until the third or fourth semester of dedicated chemistry study in college. The general education requirements for any oddball college degree are slightly--just slightly--beyond my public school education. I am engaged in dedicated study of writing and mathematics because of this deficiency. Specialist study--your core program classes--are not generally useful and, baring corner cases of tangential usefulness, are a complete waste when you land in a specialist field which does not utilize said skills.
Assembling these two facts, we realize that college degrees are worthless when missing your field. College degrees may have implied value, but the above estimates that they are overbought: the value attributed to college degrees is not real, and a BA in Management doesn't help you with Biology or Programming, etc. The value of a specially-trained specialist (through apprenticeship etc.) is much higher.
We can argue for education, but the current system causes many problems and supplies no benefits; I do favor broader general education and some changes to the education system as a whole, but my plans lead into direct and immediate class separation which bothers people. Interestingly, we already engage in class separation: I was, of course, a top-tier student labeled as Gifted and Talented, a step above Honors students, who are a cut above your regular crop, who are of course a better class than Special Education students. My GPA was damn near 16, while regular kids couldn't get above a 4.0.
More to the point, this inadvertently directed repair crews to wealthier neighborhoods. Typically, repair crews are intentionally directed to wealthier neighborhoods.
I have damn good negotiation skills compared to the average man, but not to the professional. I'm trying to improve these in a number of ways--better study, better writing, public speaking training from lawyers. But the result of my menial advantage is obvious: I can call the city and make them do things for me for free.
12 years a burned down house rots, 5 years the neighbors rail at the city to remove it, a neighborhood coalition is ignored. I made five phone calls to people I have no connection to, found that the house is not scheduled for demolition, instructed them to send an inspector and to instruct him to find certain aspects of the house as faults justifying its immediate demolition, and the house is demolished two months later. They even made repairs to my house and upgraded my finished brick wall to a block-and-cement wall free of charge. I'll purchase the extra 2400 square foot lot for $1000 and amend it to my yard.
12 years, and the neighborhood is now more poor than it was back then. Homeowners moved out, houses were left to rot, some burned down, a few became rental property. I pay my $71/year in taxes, and I talk the city into removing an eyesore at likely $5000 of their own expense. The neighbors think me a hero.
Even a Bene Gesseritt witch would heed my command, for a moment of consideration at least.
Let's say you buy a computer, and you buy insurance in case that computer burns out. Is this a good decision?
How about if you buy 10,000 computers for a company, and you buy insurance in case those burn out. Is that a good decision?
In the first case, yes. You have one computer. You are exposed to either the marginal cost of a computer some percentage of the time OR slightly more than that percentage of the marginal cost of the computer 100% of the time. Let's say 1 in 100 computers burns out in a short life--1% risk probability--for a $1000 computer. You face a 1% chance of losing $1000; or you pay somewhere above but close to $10--let's call it $12.50--and face a 100% chance of losing exactly $12.50.
In the second case, you own 10,000 of these. You face a damn near 100% chance of losing 100 of them, at a marginal cost of $100,000. Of the replacements, you'll probably lose 1 more, adding $1000. Thus your costs are $101,000. For insurance, you're adding $12.50 per computer, providing a guaranteed loss of $125,000. This puts you $24,000 behind--you should forgo insurance.
Why is this?
In the first case, your total cost is low: you have one object and are exposed to a very low, but very severe margin of risk. It's unpredictable, and will be significantly costly. For some very small marginal cost, you can avert this risk.
In the second case, your total cost is high: you have many objects and are exposed to a very low margin of risk, but one that is now a fraction of your initial cost. Likewise, the risk is repeated across many things--failure is isolated and your system is robust.
In the first case, your experienced risk is many, many times higher the marginal cost of insurance: $1000 versus $12.50. In the second case, however, your experienced risk is almost guaranteed to be $10 per machine, and so you're going to pay an extra $2.50 for an extremely unlikely event--you're overpaying for risk mitigation. Your risk is spread wide and predictable, and the cost estimates of $101,000 versus $125,000 show that you're now paying more for protection than the failure event will probably cost you.
Ignoring that this project doesn't generate profit (and thus can't act as its own source of liability mitigation), what we're looking at is the risk of an extremely expensive one-off failure. If you have a 1 in 50,000 chance of hitting a $1M satellite, then you would be appropriately insured by a policy of about $20. Foregoing that insurance puts you at a $1M risk. On the other hand, if you were to do this substantially more than 50,000 times and each time profited you more than $20, it would be highly likely that you would incur a $1M liability occasionally BUT it would be more expensive to purchase insurance than to simply accept the occasional cost of liability.
This project is a prime candidate for liability insurance. Purchasing liability insurance is a good decision, even if nothing bad happens. Purchasing liability insurance with parameters as described above is a bad decision--even if you're unlucky, not purchasing it is usually a good decision (unless risk appetite is extremely low).
Strawman argument - do you think Chevy pays for every Chevy dealership?
Of course not. They simply need to supply a single-supplier product which can make a middleman money. As-is, Tesla, like other small car manufacturers, cannot supply enough volume movement to sustain a middleman business model, although they can sustain themselves via a direct sales model.
Until Tesla is an established, powerful car manufacturer able to control a significant amount of the market, they can't supply the volume sales to make a middleman strategy viable.
because they were unwilling to let a "middle-man" get a cut of the action.
Imagine if Best Buy sold only TVs.
Imagine if Best Buy sold only Sony TVs.
Imagine if Sony only sold three models of TV, in LCD with 39 inch, 49 inch, and 59 inch.
Now imagine that Sony sells 24,000 TVs in 3 years.
How long do you think Best Buy, with 4000 locations in 48 states, selling only Sony Televisions and no other products at all, is going to stay in business?
That's how a dealership works. Chevrolet-GMC? General Motors owns both. Ford-Lincoln-Mercury? Toyota-Lexus? Guess who owns the Lincoln and Mercury brands? Guess who owns the Lexus brand? So we're talking about independent Tesla dealers who would have operating costs far outstripping their income from sales volume *unless* Tesla could control a large chunk of the market.
It's a model that only works if you have large, strong monopolies; and it only allows you to compete if you are a large, strong monopoly.
College is a speculative market. When a job field is understaffed, demand increases. Salaries go up, and barriers to entry are minimal--know something about computers? YOU'RE HIRED, KID!
Work field entrants in this system will naturally seek to maximize their potential by selecting a career compatible with their self-perceived interests and abilities, but largely weighted toward profitability and stability. This is why we mock art students so hard: they dive right into art school with no career plan, come out with a degree in Greek Mythology with a minor in Sculpting Minotaur Penises, and ... then what? (Photography and fabric students often do have a solid career path--let's face it, they both go straight to Vogue, and you wish you could get that job.) They weight for their interests and abilities too heavily, and not enough toward a critical examination of viability; we feel superior because we've made intelligent, rational decisions about our career paths.
This becomes an issue of the Prisoner's Dilemma: there are 100,000 jobs for X and 500,000 students; optimally, you want roughly 100,000 of you to study for X and the other 400,000 to study other fields which collectively supply 400,000 jobs. Unfortunately, this is not coordinated *and* there is a knowledge deficiency: the field is growing, may grow faster or slower or shrink in 4 years, and you get on your degree path and come into a world with 350,000 X jobs or 20,000 X jobs or the same 100,000 X jobs and they're all filled. Ignoring that, you and 500,000 students come out looking for job X, with the relevant degree, and 400,000 of you can go fuck off somewhere.
Trying to flip that around so anyone can be hired for any job and the successful can then go on to college doesn't sound like a very workable solution.
I advise you to read Victor Harris' translation of Go Rin no Sho, by Miyomoto Musashi. The Book of Five Rings talks in the beginning about carpentry, about foremen, about wood and laborers. It points out that unskilled laborers can provide good labor: why should a highly-skilled and valuable carpenter spend hours cutting wedges when he could be carving intricate designs into expensive furniture? An unskilled laborer cutting wedges and shims will develop manual coordination and a good eye for measuring shims; he can then cut and lay floor joists effectively, and eventually will develop skills to lay and plane floor boards, to build furniture, and eventually to finish furniture and doors with carved designs. In the interim, he is useful for keeping skilled workers doing those things instead of cutting wedges.
Imagine hiring a data entry or formatting clerk. We hire unskilled temp workers to type bullshit into systems all the time, and to take piles of documents and pick them apart and assemble reports based on simple criteria that a trained monkey can follow. This occasionally gets passed to me because I'll take output from various programs, from Excel, Word documents, and so on and homoginize it with sed, awk, and grep. The homoginized data is then readily transformed, searched, sorted, and assembled by the skilled application of computer programming. I find sed, awk, grep, and some bash utilities extremely limited yet extremely suited for these tasks--unlike full languages such as Perl or Python, which are greatly useful for heavily repeatable tasks but not as useful for immediately defining a set of complex data transformations.
Imagine that your clerk is doing such menial tasks for accounting or finance, or for whatever reason. Importing data for sorting and searching to test a new computer system, or migrating data from one to another. He shows some promise and becomes familiar with the tasks at hand, so you send him to get educated in computer programming, system administration, accounting, or whatever set of relevant skills you feel would improve his viability to the company. Your company is growing, and perhaps you acquire two or three
Almost everything you mention here involves internal combustion engines.
Oh okay, so because it doesn't have an internal combustion engine, it's immune to all kinds of discrete part flaws and integration flaws that don't lend themselves to prediction and don't crop up in minimal testing. Got it.
It can be used as a real time monitor for space weather
You seriously do not want to enter Shadesmar on Sel.
A man who doesn't understand insurance. Amusing.
I've read the Harvard Business Review guide to quality writing. I am convinced it degraded my writing ability.
I would suggest the fourth edition of William Strunk, Jr.'s and E.B. White's small volume, "The Elements of Style". Avoid Harvard garbage.
I never saw the low-end S offered. It was always coming soon, then vanished.
What law does "under God" enact?
Which is their own fault/problem, not a fault of the system under which cars have been sold in this country for decades, with the exception of Ohio's recent attempt to specifically outlaw the sale of Tesla automobiles (a dumb and unconstitutional move, IMO).
It's their own fault that they're not a 30-year established company with multi-billion-dollar income able to support tens of thousands of dealerships all over the country in convenient locations for the consumer? Come on, there's 24,000 Teslas on the road. There's almost 4000 Ford dealers. Each Tesla dealer would have claim to, what, 6 sales?
Have you ever wondered why every small auto manuafcturer--Tucker, AMC, etc.--in the US has failed or been bought up by the big three?