Wednesday, April 30, 2008
Sunday, April 27, 2008
"Looking at trade data between 1994 and 2005, Broda and Romalis construct inflation rates for different income groups and find that rates for the richest outpaced rates for the poorest by about 4 percent over the period. Since income inequality between the top and bottom 10 percent of earners grew by about 6 percent, the different inflation rates among income groups wipes out about two-thirds of the rise in inequality."
Friday, April 25, 2008
Thursday, April 24, 2008
"In 2006, a Rhode Island jury found three major paint makers liable for the toxic effects of lead paint on children...Now the paint manufacturers are appealing...due to the extraordinary level of interest in the case, oral arguments will be Webcast live."
Can I just say that this is beyond awesome? Probably the best thing since I was able to catch Book TV on the web after my cable company stopped providing C-SPAN2.
Then again, I may be a bit over-enthusiastic. I liked reading legal briefs in my law and management class. I've never watched an ACTUAL proceeding. I'd probably be nodding off after the first 20 minutes while the lawyers moan about subject matter jurisdiction or some crap like that.
Our compensation management teacher likes to spend the first several weeks of class going over some basic microeconomic theory (cost curves, total production, etc. Never even really get into isoquants, for those of you that are indeed econ majors). The reason he does this, he explains, is to educate us on basic business strategy. I really don’t see the point of it: it can be summarized in the equation:
Marginal Revenue=Marginal Cost
Meaning that you don’t hire someone unless you are sure that employee is actually doing something productive and making you money instead of engaging in competitive thumb-twirling with his employees (talk about a demotivator).
Our professor then goes on to explain that HR professionals, in general, are NOT in tune with the rest of the corporation on strategic issues, and this means an inefficient workforce. Mr. CEO apparently can’t send his directions correctly through the memos. Or perhaps his secretary couldn’t understand his drunken ramblings after a night of expensive champagne and $5000 an hour hookers.
Anyways, the point is that we absolutely cannot make a compensation strategy unless we know what the overall business strategy is. Once again, that should make perfect sense, and that’s why I increasingly think college is really just education for lazy smart people.
So, what kind of homework assignment do we get on Tuesday?
Develop an executive compensation bonus package.
What are the objectives?
Damned if I know. I just gotta design an executive compensation bonus package. Not even the whole package, just the bonuses.
I would laugh at the irony, but tuition is $7,000 per semester.
Wednesday, April 23, 2008
"What I don't understand is why Europeans care that Americans think that their country is great.
I think my wife is the best woman in the world.
That is why I married her.
That doesn't mean that you can't think your wife is great too.
I think my country is great. That is why I live here.
I expect that Europeans think that their countries are great too. Good for them. I don't spend two seconds worrying about what other people think about their own country or trying to point out shortcomings. Heck I don't know enough first hand about any European country to even make valid comparisons (and most Europeans don't know enough about the US either).
Why so much haterism from Europeans? I'm with Tyler, seems like some insecurity about something to me."
Credit goes to a man named eccdogg
Tuesday, April 22, 2008
Time: 6:00pm - 8:00pm
Location: Cardinal Room in SCE
Street: 720 S Halsted Street
City/Town: Chicago, IL
I was reminded of that this morning when reviewing a presentation my friend was preparing for some executives from a major corporation (no need to say which one). He said that the company's stores should switch from selling a low-margin product to a high-margin product, simply because of the margin.
But, intuitively, we all see something wrong with that. Namely, that low-margin products might sell faster, giving us more money in the long-run.
That's why we shouldn't look just at profit margins when we're determining how valuable a firm is. Otherwise, restaurants and supermarkets would be considered bad investments.
A much better measure is return on equity or return on assets, which shows how much money a company makes for every dollar of investment it has.
That's my thought on "profit" for today