I put Steve Wynn up there Steve Jobs as one of the world's top biz people...check out his interview on business, trends, and his attitudes...
I watched him interviewed on 20/20 (I think) once where he was asked if it is possible for his customers to ever ultimately get ahead of the house (win more than they lose). His answer: No.
I love his point on making money off your savings, not debt... health care, government, finance...
He sounds like me... how come I am not a billionaire like him? Sheeesh!
Friday, May 28, 2010
Steve Wynn On Trends
Health Care Crushes Small Business
Mish is on the mnoney again with a report on how the health cares costs, skyrocketing because of govt involvment, are crushing exosting small businesses. We'll never know what businesses did not start because of the USA health care system costs.
And I should be careful here, there is a big difference between what we pay and what health care costs. Health care does not cost anywhere near as much as we pay. Single payer will not solve the problem, because the problem is the govt which is involved in health care. And with single payer, the whole thing is turned over to the entity that is wrecking it.
Thursday, May 27, 2010
Apple Cuts Suicide Rate Cut In China Over 90%
Apple is bigger than Microsoft now, in market cap, and that measn the anti-Apple stories start. A company that makes products for Apple has had 10 suicides in the last year. I did not expect to read this in the article, but someone did their homework. With a suicide rate in China of about 14 in 100,000, and these factories emply about 900,000 people, a suicide rate of 10 means an Apple job makes peple very happy, cuting the suicide rate by over 90%..
Wednesday, May 26, 2010
Must View IPR Video
Here is an excellent pro-free market, anti-IPR video, with one particular point I've long made: people who buy knock-offs are not your customers... so says Tom Ford...
http://www.youtube.com/watch?v=zL2FOrx41N0&feature=player_embedded
Then check out these all start creators from many fields all criticizing IPR...
http://www.learcenter.org/html/projects/?cm=ccc/fashion
I've complained about Diane Von Furstenburg on this blog before, and everyone should boycott her clothing.
It is good to see IPR is getting ever more disputed.
Why Louisiana?
Ragin Cajun James Carville, as talented an apologists for democratic preferences as any, has taken direct aim at Obama over the lackadaisical response by the feds to the oil blowout.
How come disasters in Louisiana get such tepid response? Could it be because Lpuisiana is not completely part of the UCC?
Could it be where in most places in USA oil is controlled by Big Govt/Big Oil, Louisiana managed to keep its oil controlled on the State level, with profits rather local?
And with its independent thinking, and strategic place at the Mississippi delta, what with South America growing in importance to USA, just can't let things stay the way they are in Louisiana.
The definition of a gaffe is when a politician speaks the truth. Mayor Nagin famously said after Katrina New Orleans "would be chocolate again" when it was clear to black Americans the government response was designed to ethnically cleanse new Orleans, although in a peaceful manner.
Do I think there is a conspiracy? No, just as politial advisors remind their bosses, never waste a disaster. Oil is gushing up from a mile down. Stopping it is a matter of physics. Not stopping it is a matter of politics. Expect big changes as a result of this disaster. None good for New Orleans. Hence Carvilles rant.
New Service Charity Opportunity
The concern that USA couples are adopting kidnapped children in China has been aired for quite a while, such as a few years ago in the Washington Post.
Of course, such an article is controversial, as this response and it's comments shows.
Now the fellow defending Chinese adoptions argues with so many abandoned girls in China, why would anyone bother running the risk of kidnapping babies to supply USA demand? The answer is quality control. Truly abandoned kids have all sorts of medical problems and no doubt, given neonatal psychological development, adopting out truly abandoned kids makes for unhappy adopters within a few years. It is bad for repeat business, and future referred business. One Russian seven-year-old boy was shipped back alone in last month when his American parents found him unsuitable. Return to Sender. Much better to steal happy well adjusted kids from intact families and sell them off to a wealthy American family. The world can be a wicked place, and that is good to know.
In Hong Kong last month I read about a Father searching for his daughter, and it was heart-rending.
So what is the Charity initiative? Set up a charity that gets an agreement for the Party that no kid leaves China without a DNA test, database one, paid for by the wealthy American adoptors. Second, every parent missing a kid in China is given a DNA test, funded again by the adoptive parents, database 2. (This must be done by an independent group, such as a charity, with data secret without a warrant, can't let govt have such info.) Match the two, weed out kidnappings, and let the Communist Party deal with the traffickers. Surely some director of this effort would be worth say $250,000 per year. Now the tricky part comes with kids already in USA. A ten year old kid in USA adopting at one years old presents serious problems. Plenty of parents would be dying to know, many of which would be keen on making some amends. Here again a charity would be better than some political (legal) solution, since some problems cannot be addressed by markets or politics. Maybe a website that lists just the dna code of parents, and USA adoptive parents can have independent USA labs check paternity (and maternity) and then decide what to do.
Of course anything with such high stakes, emotionally and financially would be frught with peril and oppty for fraud. It would take some serious skill to make it work, but it would be real charity, providing a service that a market just cannot serve, since the disaster is outside of the financial capability of the victims.
Women's Start-up Checklist
I received an email offering a checklist for women starting up a business. Essentially it says get your permits, registrations, etc, first. Of course, I politely disagreed. There is another link to another article by one Carol Roth that does make the point customer first.
But I read a link to another article, in which an expert said "'State taxes paid are a healthy deduction; just don’t allow yourself to be surprised by how high Uncle Sam’s bill may be. “I often advise setting aside 50 percent of net income to cover everything,” Wherley says. “If there is something left over, the refund is that much sweeter.”"
Yikes! To be a deduction, state taxes must be paid. Shouldn't the first question be, why are there state taxes, what do we get for our money? And then, the same question should be asked of the feds. As to taxes, the best advice is comply and complain. We need more on the complaint side.
Sunday, May 23, 2010
Tactical Question on IPR
I received a comment on my IPR post below, but it has such good questions I will move my answer here to the main page... my responses are in quotes...
***
I have a fledgling import business that has not quite gotten off the ground although prospects are looking food. Recently I discovered that magical combination of the 4Ps of which you speak. Sales were astounding -- and effortless.
So you have customers, everything will flow from this...
Unfortunately I have discovered that the design for this product has been patented by an American inventor in my country, and a potential client who would like a very large quantity is afraid of the legal implications of ordering them.
Don't you love imperialism?
Now my problem is to decide whether to continue marketing this product despite the patent. My customers love it and I am able to offer them a very good price. I do not believe in the IPR and object to a foreign inventor claiming monopoly on a design in my country -- which they do not even serve directly but only indirectly through agents.
Of course the other option is to do what you always advocate, which is to compete on design. I am not sure that I can produce a better design, but I think I can create a different design that might do the trick if marketed properly. In any event, competing on design is definitely the more creative way to engage with the market, so this is the avenue which I will likely go down.
This attitude gives you something to negotiate with against the patent holder.
But I still feel that I am playing into the IPR game by backing away from this product, despite the fact my customers want it eagerly.
You do not have to back away, see below.
For example, I could continue to market the patent-infringing product AND market my new design, sell them alongside one another and let my customers tell me which one they prefer.
This would be an interesting experiment in market research. What if you were to refine this test a little more, and NOT offer the patented product at a lower price, but at the same price at which the patentholders agents in your country offer it? I'll explain below.
That would be a nice experiment, except again I have the worry about litigation. Sure, I am a very small fish and can probably get away with doing this without attracting the attention of the patent holder. But it limits my ability to supply these larger clients, who cannot hide in obscurity like me because they operate high-profile boutiques across the country.
All very true.
So, should I: a) continue selling the patent-infringing product; b) compete on design and sell a different product; c) attempt both options a & B and see what my customers think? Any thoughts on this question?
The first reaction to injustice is always to comply and complain. Don't break the law, so comply with the Intellectual Property Laws of your country. And complain whenever you can. But in your case, you can do more. You have customers for the patentholders product. You have alternatives to the patentholders product. This is enough to make a reasonable offer to the patentholder.
Your objective is to launch a business. Your strategy is to compete on design. Your tactic in this case is to get a license to sell the patented item to your customers. You say the patentholder already has agents offering his design in your country. And you found customers that these agents failed to find? You say you have alternatives you can market alongside your designs? Then do so, but offer the patentholders design at the going price (because you will have to charge more to cover a royalty if in fact you get a license.)
Keep in mind the USA patentholder apparently is a good enough designer to create products that would sell well in your country (almost no patented product ever gets to market, because they have no use in real life). With or without IPR you'd be delighted to pay him a royalty on his designs.
You have the ultimate card: customers. Once you have tested the designs in the market, take your facts back to the patentholder. Explain to him that he will grant you a license to sell his product in your country, or you will offer the alternative to his in your market. he should do this because his present agents are underperformers, inasmuch as you find customers that the agent cannot. Make the patentholder a reasonable offer. In business the one with the customers always wins.
Of course, either way, as you build your business, you are in the driver seat as to whether you continue to work with the patentholder, find other designers, or whatever. "Competing on design" presumes designers, and they too should be paid. I have no objection to that, it is only monopoly on ideas and designs that is unjust.
Let me know what you think.
It Costs Too Much
This good law firm offers to help food importers deal with the enhanced enforcement by the FDA of rules on importations of food.
For example, his firm refers to FDA Import Alert 16-18,
"Detention Without Physical Examination of Fresh and Frozen Shrimp from Bangladesh, Hong Kong, Indonesia, Taiwan, and Thailand" for filth, decomposition and Salmonella. Shrimp from those countries will automatically be detained by the FDA until a United States laboratory provides sufficient documentation to the FDA that the product meets U.S. standards.
Now there are so many problems with this. First, detention without examination, as in guilty until proven innocent? We are going to treat shrimp like Muslims?
Second, one needs a lawyer to grease the skids if you wish to be a shrimp importer? Big companies can afford this and pass it on, small companies cannot. Here we go again - USA Govt policy: get big, or get out.
Third, if there is a problem, don't blame the shrimp, don't blame the exporters, blame the importer. The importer sets standards and inspects every shipment. (The FDA cannot inspect every shipment, hence the "guilty until proven innocent by a third party" rule.) If there is a problem, the importer will face sanctions of the most severe kind: customer reaction. The retailers and restaurants to whom the importer sells the shrimp will see what they bought (another level of inspection before consumption) and simply reject the shipment. Reject shrimp is all the harder to sell, and it's fresh date is not very long. And it is not just rejection of the shrimp ... I've worked in enough kitchens in my time to see a chef ream a salesman for poor quality ingredients. It's not just a matter of rejecting the offending shipment, if the shrimp is no good, the Seviche is off the menu for that day, and there is no recovering the economic loss to the restaurant, and no assuaging the aggravation of the chef. Or worse yet, something nasty gets past a chef, and to the customer. There is nothing like a rat turd in the Seviche to put a diner off his feed. I've seen food salemen shake in fear before a displeased chef. There is no judge more fearsome in hell or the federal government as terrible to a food salesman than a pissed off chef.
And if in fact there is a tortous case, then sue the importer, under the legal theory that the importer is the manufacturer (or fisherman) since the overseas exporter cannot be touched by USA law.
Many foods are somehow poisonous if not prepared correctly. The reason we are not all dead or spend more time with food poisoning is because most chefs properly prepare most food. To focus such enforcement resources on such a sliver of threat, among all of the threats, is foolish policy choice. We always have and always will leave the vast majority of threats to food safety to the chef to deal with.
The ultimate food safety officer is the cook. No rule can or will ever change that. He is the one who takes the blame if someone gets sick, he is the one who is in control of what leaves the kitchen, and whether proper systems are in place to assure the spinach is free of e coli and the chicken is free of salmonella. Food safety is up to the chef, and the chef can effect change all the way back to the fisherman. The chef is necessary in food safety, the chef is sufficient for food safety.
Why pretend the FDA can inspect every shipment, when we know they cannot? Why do we pretend the importer cannot inspect every shipment, when we know they do?
FDA inspection actually invites poor quality importations. The consumer is duped into thinking imported food is inspected, and thus safe. This creates a false sense of confidence. A fly-by-night agent can import bilge strainings in bulk to sell to some huge food processer that is putting the shrimp in a chip dip it makes, rat turds and all. Since there is none of the cost of running a responsible business to the flybynight agent, the food processor gets a very low price, and arbitrages the difference for a nice profit. Consumers are confident, and thus fooled into complacency, a complacency upon which the flybynight and huge processors can play. Until something goes wrong, and someone gets sick or someone finds something gross in the shrimp chip dip.
The food processor claims it is a victim of the importer, blames the FDA for lax inspection, and the flybynight agent disappears with a few hundred thousand profit (to reopen another shop under another name). The FDA complains they are short funded, and so they get some more money from congress, although it does not help. Everyone is in on the game. These guys could be bankers! It's a great system for irresponsible people made possible by the pretense FDA inspections.
If we are looking for ways to save money in our econ crisis, get rid of all inspections at the docks and tell America to watch out, caveat emptor, and if something goes wrong, hold the importer liable. We'll save money and improve safety and quality.
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