Sadly, One Person’s Misfortune Is Another’s Ticket to Wealth

You’ve hit rock bottom, perhaps because of choices you’ve made, or perhaps because of some bad luck.

You need money, and you need it now.

Some of us are fortunate enough to have family or friends we can turn to in such situations, some of us are not.

But one of the great things about capitalism is that if there is a demand for something, there’s usually someone willing to meet that demand. It’s also one of the weaknesses of capitalism, since it can potentially create a desire for wealth at all costs.

And that’s where payday lending comes in, a multibillion-dollar industry.

The Philadelphia Inquirer recently had a story about a local entrepreneur who owns more than 25 loan companies, many of which (if not all) were involved in payday lending.

The basic idea behind payday lending is that a person will take out such a loan for short term financial needs, with the hope of paying it off with his or her next paycheck.

Unfortunately, for many people taking out such loans, it doesn’t quite work out that way.

These individuals struggle to pay back such loans, and when they struggle, the lending companies show no mercy. In fact, these types of customers are the most profitable, since interest starts to accumulate.

The article tells the story of one person, a high school science teacher, who needed to take out such a loan, and the interest rate on the loan was 350%. That’s right – three hundred fifty percent. The borrower ended up having to take out more payday loans  to cover the payments on previous loans.

Talk about a vicious cycle. And in fact, the payday lending company in this article has charged as much as 800 percent interest on some loans – 133 times higher than the cap for unlicensed lenders in Pennsylvania.

Meanwhile, the lender in this story lives in a $2.3 million dollar home and drives a Bentley. Nothing wrong with that per se, as long as such wealth was earned honestly and by not harming anyone along the way.

Federal prosectors have brought racketeering charges against this individual.

One trick some of these lenders employ is to set up shop on Native American land. By taking advantage of internet advertising and the tribal sovereignty granted to federally recognized Native American groups, payday lenders who set up shop on tribal lands can effectively “export” whatever interest rate they want into states across the country.

Prosecutors have described this strategy — known in the industry as “rent-a-tribe” — as a sham with tribal leaders having little involvement in the businesses other than to collect monthly payoffs. Lawyers for the defendant maintain the practice is legal.

I learned as a teenager, just because something is legal, it doesn’t make it right. I guess not everyone learned that lesson.

To me, there’s some strong evidence against the defendant, particularly his own words:

In this environment today, you’ve got to run afoul of the regulators. You can’t [survive] if you don’t lend in California or Colorado or New York or Florida.” (These are states with some of the tightest restrictions on payday lending.)

Let me tell you what my thoughts are on tribes and payday loans,” he said while discussing a rival’s business. “I believe that [regulators are] going to prove that it’s a sham. …  I think they’re going to prove that they’re farces. And, let’s face it, they are.”

I couldn’t agree more. These payday lenders are a farce, but unfortunately, they are laughing all the way to the bank.

P.S. Here’s a PBS segment on payday loans, showing the kinds of individuals who might take out such a loan and some of the effects that it has on them and on society as a whole.

*photo from Law Street Media

Reconnecting, Thanks to Facebook

My wife and I went out to dinner last night with two other couples, one of which we had not seen in probably 20 years. It was a wonderful evening, filled with lots of reminiscing, catching up, and laughter (not to mention good food and wine as well).

I’m not really sure how we had all drifted apart, but I do know what brought us back together – Facebook.

Somehow I started to see some of our old friend’s posts on Facebook, realized we seemed to share a lot of the same beliefs, and we reconnected.

We would like each other’s posts and offer the occasional comment on those posts as well. After a year or so of this, we finally decided it would be fun if we all got together, and so last night it finally happened.

We were at the restaurant for close to two and a half hours, and it felt like we could have sat there for another two and a half hours, but it was just about closing time.

We went our separate ways, but with plans to get together for a game night in the near future.

Who knows if last night would have ever happened without Facebook, so I have to give credit where credit is due. The Facebook platform makes it easy for such reunions to take place, and for that I am grateful.

But I’m even more grateful for having such good friends.

How Can Something So Smart Make Us So Dumb?

To me, it is the greatest product of all time. It’s a telephone, a music and video player, a movie making device, a banking device, a communications device, a gaming device, an information retrieval device, a GPS, a home automation control device.

Do I need to keep going? I could list dozens more things this product can do, but I think you know what I am referring to.

It’s a smartphone, of course.

It’s amazing to look at one of these devices, which fit in the palm of your hand, and think that it has more processing power and storage space than the early mainframes, which were the size of rooms.

But like most things in life, nothing is perfect (well except for a 300 in bowling).

A growing body of research suggests that just by having a smartphone with us, it diminishes our intelligence.

  • A 2015 Journal of Experimental Psychology study, involving 166 subjects, found that when people’s phones beep or buzz while they’re in the middle of a challenging task, their focus wavers, and their work gets sloppier—whether they check the phone or not.
  • Another 2015 study, which involved 41 iPhone users and appeared in the Journal of Computer-Mediated Communication, showed that when people hear their phone ring but are unable to answer it, their blood pressure spikes, their pulse quickens, and their problem-solving skills decline.
  • Another study looked at the impact of having a phone close by while taking tests of intellectual acuity. The results were striking; subjects whose phones were in view posted the worst scores, while those who left their phones in a different room did the best. Conclusion:  as the phone’s proximity increased, brainpower decreased. Students who didn’t bring their phones to the classroom scored a full letter-grade higher on a test of the material presented than those who brought their phones,”
  • And finally, a study of 91 secondary schools in the U.K., published last year in the journal Labour Economics, found that when schools ban smartphones, students’ examination scores go up substantially, with the weakest students benefiting the most.”In other words, smartphones are making us dumb.

And for those of who use a smartphone, you know there a ring of truth to such a statement.

Who hasn’t become increasingly dependent on their smartphone, or oblivious to the environment around theme?

But I’m not jumping off the smartphone bandwagon.

As I stated at the beginning of the blog, I consider smartphones to be the best product ever developed. But it needs to be used in moderation so that you don’t become addicted to it.

Easier said than done, but doing so may be worth a a point or two on an IQ test.

Speaking of IQ tests, did you see that President Trump … never mind, it’s not even worth going there…

I’d Fit Right In with These 26-Year Olds

The Wall Street Journal had a story today about 26-year olds, the biggest single age cohort today in the U.S. at 4.8 million.

The focus of the story was on the new approaches to marketing that companies must use with this age group. Companies are placing a particular emphasis on education when marketing to 26-year olds, offering classes and videos that some executives thought might be too basic, but apparently not.

For example:

  • The Scotts Miracle-Gro Co. has started offering gardening lessons for young homeowners that cover basic tips—really, really basic—like making sure sunlight can reach plants.
  • Companies are hosting classes and online tutorials to teach such basic skills as how to mow the lawn, use a tape measure, mop a floor, hammer a nail and pick a paint color.
  • P&G, the maker of Swiffer, found millennials clean their homes differently from older generations and are more likely to clean as needed. As a result, Swiffer advertisements this year highlight how its mops and dusters help “in the moment.”
  • J.C. Penney Co. says the group is willing to hire others for projects. The retailer has pushed into home services,  finding that millennials are much more of a ‘Do-It-for-Me’ type of customer than a ‘Do-It-Yourself’ customer.”
  • Home Depot company introduced a series of online workshops, including videos on how to use a tape measure and how to hide cords, that were so basic some executives worried they were condescending. As it turned out, they weren’t. Even the vice president of marketing, initially concerned about some of the proposed video lessons, learned a new tape-measure trick: Attach the end of the tape to a nail and hold a pencil against the tape measure’s base to draw a perfect circle. More lessons are coming, including how to hang Christmas lights.
  • Briggs & Stratton collaborated with Toro Co. to introduce the Mow N’ Stow foldable mower, which doesn’t require users to know how to prime, choke or change the oil of its engine.
  • Scotts discovered that millennials aren’t trying to achieve the lushest lawn or biggest flowers, as their elders are, executives say. They want to get something out of gardening, like vegetables and herbs. The company has also been more careful about what ingredients it puts into its products.

When I look at the list of what companies are doing to market to 26-year olds, it seems like they should be doing the same for me.

I don’t know how to pick the right paint color; I’ve never heard of the trick of using a tape measure to draw a circle, I tend to clean on demand, I’m quite willing to call someone to do a repair as opposed to trying it myself, I’ve never changed the oil on my lawnmower, and I’ve owned one for over 30 years (it’s a moot point now, since I now own an electric lawn mower), I’ve switched from hanging Christmas lights to just putting one of those colored laser lights on my house, and I’ve never been concerned about having the lushest lawn or biggest flowers (or for that matter with growing vegetables or herbs).

So I guess that makes me a 26-year old trapped inside a 60 year old body.

Maybe ignorance (and laziness) is the secret to staying young.

P.S. And talk about lazy, that’s not even my house in the picture at the top

Taking Advantage of Our Most Vulnerable

“They thought they were going to rehab. They ended up in chicken plants.”

So begins a story by the Center for Investigative Reporting. If you want to read a story about how corporations, counselors, and our court system take advantage of our most vulnerable systems, then I highly recommend you read the full story on the Reveal news site. I’ll warn you that you may find the story disturbing and depressing.

But if you’re short on time, I’ll try to point out the highlights, taken from the story.

  • Christian Alcoholics & Addicts in Recovery (CAAIR), sometimes referred to as “the Chicken Farm,” is a rural retreat in Oklahoma where defendants, instead of jail time, stayed for a year, allegedly getting addiction treatment and learning to live more productive lives.
  • Most men sent to CAAIR are addicted to alcohol, meth, heroin or pain pills. They are usually young, white and can’t afford stays in private rehab programs.
  • There wasn’t much substance abuse treatment at CAAIR. It was mostly factory work for one of America’s top poultry companies.
  • The defendants worked for free. CAAIR pocketed the pay.
  • If an individual got hurt or worked too slowly, his bosses threatened him with prison. When men did get hurt, CAAIR filed workers’ comp claims and kept the payouts. Injured men and their families never saw a dime.
  • The beneficiaries of this and similar programs span the country, from Fortune 500 companies to factories and local businesses. The defendants work at a Coca-Cola bottling plant in Oklahoma, a construction firm in Alabama, a nursing home in North Carolina.
  • Chicken processing plants are notoriously dangerous and understaffed. The hours are long, the pay is low and the conditions are brutal.
  • Legal experts said forcing defendants to work for free might violate their constitutional rights.
  • Another violation appears to be that drug courts in Oklahoma are required to send defendants for treatment at certified programs with trained counselors and state oversight, yet CAAIR is uncertified.

There are some success stories at CAAIR.

The strict regimen has helped some men get clean. Those who arrive without a home, steady employment or food said they find their basic needs met at CAAIR. Those who complete the program without breaking any rules are eligible for a gift of $1,000 when they graduate.

“I have to say CAAIR was the hardest thing to do in my life,” said Bradley Schott, who graduated in 2014. “I went to basic training at 16. And (Army) Ranger school. And it wasn’t as hard as CAAIR, mentally or physically. But it saved my life.”

So the potential is certainly there for such a program to work.

But it seems Schott’s experience is the exception, rather than the rule.  In 2014, CAAIR reported that about 1 in 4 men completed the program.

This just seems like a system designed to take advantage of people when they are at their most vulnerable.

As Pearl Buck wrote, “… the test of a civilization is the way that it cares for its helpless members.”

In this case, I’d argue that those involved, from CAAIR, to the corporations, to the courts, have failed the test, yet it’s the most helpless who face the consequences.

*Image from story

Who Knew a Porta-Potty Could Bring Out Your Creative Side

Today was the Philadelphia International Dragon Boat Race, and you couldn’t have asked for a better day. The weather was perfect and our team, Friends of Linda Creed, had our best performance ever, qualifying for the B division for the first time.

There’s a good deal of free time between races, and so I decided to take a walk past all of the competitor’s tents. It’s quite a festive atmosphere, with lots of food, games of cornhole, and decorated Porta-Potties.

That’s right, decorated Porta-Potties.

Surely one of the most disgusting (but useful) products ever developed, there were dozens of Porta-Potties throughout the Athlete’s Village. Some of the Porta-Potties were public ones, and some of the teams rented their own.

It was these private Porta-Potties that caught my attention, because many of them were decorated. Someone told me that there was actually a separate competition for the best decorated Porta-Potty, and some of the teams took the challenge quite seriously (and humorously).

Here’s a gallery of the decorated Porta-Potties. I admire the creativity of these decorators, but to paraphrase President Obama: “You can wrap an old fish in a piece of paper … it’s still gonna stink.”

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Happiness Metric Reaches All-Time Low

Back in 2013, a group of applied mathematicians (yay math!) from the Computational Story Lab at the University of Vermont developed what they referred to as the Dow Jones Index of Happiness – hedonometer.org.

The Hedonometer measures the happiness of large populations in real time, based on people’s online expressions, capitalizing on data-rich social media, and measuring how people present themselves to the outside world. For the first version of hedonometer.org, Twitter is the source of the data.

Before sharing what caused the metric to reach an all-time low, here’s a little blurb about the methodology behind how the hedonometer works, taken from the hedonometer.org web site:

To quantify the happiness of the atoms of language, we merged the 5,000 most frequent words from a collection of four corpora: Google Books, New York Times articles, Music Lyrics, and Twitter messages, resulting in a composite set of roughly 10,000 unique words. Using Amazon’s Mechanical Turk service, we had each of these words scored on a nine point scale of happiness: (1) sad to (9) happy. 

hedonometer.org currently measures Twitter’s Gardenhose feed, a random sampling of roughly 50 million (10%) of all messages posted to the service, comprising 100GB of JSON each day. Words in messages written in English are thrown into a large bag (containing roughly 100 million words per day), and the bag is assigned a happiness score based on the average happiness score of the words contained within.

The people behind the metric fully realize that Twitter may not be the most representative data, but offer some compelling reasons as to why it is still a useful measure:

  • We have found that our measure of happiness correlates very well with traditional surveys of well-being (see here for details).
  • Twitter provides a stern test for our instrument due to the enormous amount of data we receive and must process in real time.
  • We can focus in on Twitter communities to gain a sense of what people are expressing (e.g., countries and cities); and
  • Twitter continues to become a more and more important collective, global media voice, and is thus an important story in itself worthy of scientific analysis.

So there’s a little background, but for those interested, there’s even more on the hedonometer.org web site.

Now on to the tool itself, and the reason why it hit an all-time low.

Currently, it looks like the scale that is used has events ranging from 5.7 to 6.4, with a higher number reflecting more happiness. (You can click on the image below to go the hedonometer.org web site, and the image is interactive; when you place your cursor over one of the data points, it offers additional detail as to why that date received its happiness score.)

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The scale dipped below 5.8 for the first time this week as a result of the mass shooting in Las Vegas.

It’s interesting to look at other high and low points on the index. It appears as if for each year since the index started, Christmas Day has been the happiest day of the year, which seems to lend some credibility to the metric.

Other happy days, as seen on the graphic above, include Thanksgiving, New Year’s Mothers’ Day, the wedding of Prince William and Kate Middleton, and the day same sex marriage was declared legal in the U.S.

Many of the low points are the result of terrorist incidents, natural disasters, deaths of celebrities (the deaths of Michael Jackson and Robin Williams are noted on the image), and the election of Donald Trump.

One interesting event was the death of Osama bin Laden. Many people may consider that a happy day, but on the index, it is rated as a sad day. Hedonometer.org offers an explanation for this apparent contradiction:

Many people presume this day will be one of clear positivity. While we do see positive words such as “celebration” appearing, the overall language of the day on Twitter reflected that a very negatively viewed character met a very negative end. It was a day of complex emotion which is best explored in the word shift for the day, rather than the single number of its average happiness.

I find the index to be fascinating, since it’s one more way to look at happiness, a topic that has been the subject of many of my posts.

I’m also thinking that maybe some day I’ll have an impact on that day’s happiness index. In particular, I’m thinking about the day I stop blogging.

The index on that day may set an all-time record as a result of the collective happiness of all the people whose wish finally came true.

All Out of Love?

Let’s hope that Air Supply’s classic doesn’t become the theme song for a Massachusetts-based baker and wholesaler.

Nashoba Brook Bakery received a warning letter from the U.S. Food and Drug Administration reprimanding the company about one of the ingredients it lists in its granola.

The ingredient causing the concern – LOVE.

Here is the text from that warning letter:

Your Nashoba Granola label lists ingredient “Love”. Ingredients required to be declared on the label or labeling of food must be listed by their common or usual name [21 CFR 101.4(a)(1). “Love” is not a common or usual name of an ingredient, and is considered to be intervening material because it is not part of the common or usual name of the ingredient.

John Gates, who has co-owned Nashoba Brook Bakery in Concord for 19 years, stated in an interview that “passion, care, attention and love is at the heart of what we do, and if we don’t have them in the production of our products, they don’t come out as good.”

Gates plans to send a letter to the FDA requesting a reconsideration of the love-removal order, but said he doesn’t hold out much hope it will go anywhere.

I’m all in favor of appropriate food labeling, but I’m an even bigger fan of common sense, and that seems to be the missing ingredient in the FDA warning letter.

I hope the FDA reconsiders its request, but even if they don’t, I don’t think Nashoba’s granola will be “All Out of Love”; I’m sure it’s a key ingredient to its success.

A Startling Statistic

I’m not sure how we got on the topic, but a couple of weeks ago I decided to take a poll of my students and ask them what type of smartphone they had.

Before I share the results of the survey, some background data.

On a worldwide basis, Android phones have a commanding lead over iPhones, with about 80% of the market compared to just 20% for iPhones. In the U.S., the difference is not as dramatic, but Android phones still have a significant lead over iPhones, with about 65% market share versus just 35% for iPhones.

So I was expecting my poll to approximate such results, but it wasn’t even close.

In my four sections of freshmen business students, out of a total of 84 students, only three students did not have an iPhone.

That’s a 96% market share for iPhones!

I’m not sure how to interpret such a startling statistic.

I have seen some stats that indicate that the iPhone is relatively more popular among younger individuals and among those with higher household incomes, which are certainly two categories that Villanova students fall into. But when I say relatively more popular, it doesn’t mean that the iPhone has a higher market share among these demographics, it’s just that the discrepancy is not as wide as it is for the overall U.S. population.

So that makes the 96% market share for iPhones even more remarkable.

I’m also not sure what Apple or Google or an Android phone company like Samsung should do with such info, but I’m sure they would be quite interested in seeing the results of this survey.

So there you go Apple, Google, and Samsung. The ball is in your court now, I’d be curious to know what your reactions are.

And if you want me to be a shill to my students for your phone over your competitors, please know that I can be bought pretty cheaply.

A personalized tour of your corporate headquarters, lunch with your CEO, and a shout out on your social media platforms about my blog should do the trick.

I’ll wait to hear from you.

*image from MindStudios

Binge Reading, Courtesy of Myron Bolitar (Harlan Coben)

Three months ago I wrote about a trip into Philadelphia that included stopping at a used book store. The reason for visiting the book store was to see if they had some of the first books in Harlan Coben’s Myron Bolitar series.

A couple of friends had mentioned how much they enjoyed the books, and I thought if I was going to read the books, I wanted to start at the beginning. Fortunately the used book store had a few of them, which I purchased, and quickly read. (I also read his first two novels, Play Dead and Miracle Cure, which did not feature Myron Bolitar, prior to starting the series.)

After reading the first couple books in the series, I became hooked/obsessed, and I started looking everywhere to find the next ones in the series (I wanted to read them in proper order). I would visit local libraries, used book stores, Barnes & Noble, and Amazon, and it was a combination of all of those that enabled me to finish the series. I believe the last few were all read on my Kindle, the result of borrowing the books through my local library.

It’s my first experience with binge-reading (if there is such a thing), and it follows pretty closely on my first experience with binge-watching.

There are a total of 11 novels in the series, and it took exactly three months to finish the series. I viewed it as a guilty pleasure, sneaking in a few pages here and there, staying up way too late a few nights to finish a few of the books, or heading out to Barnes & Noble to read a couple of chapters while having a coffee.

There was much about the books that I enjoyed. The main character, Myron Bolitar, is a former star basketball player whose professional career was cut short before it even began. He then started a business representing athletes, which eventually led to representing all forms of talent (actors, writers, etc.). The stories sucked me in almost from page one, and I didn’t want to stop reading until I finished the book.

Bolitar is surrounded by a colorful group of friends/colleagues, and there is some great humor in the books, as well as a good deal of social commentary. There’s a local connection as well – Bolitar’s partner and best friend in the series, Win, is based on Coben’s college roommate, who apparently does not live that far from me.

Over the past couple of months I’ve tried to learn more about Coben, and came across a few insightful articles:

Like Myron Bolitar, Coben seems like the kind of guy I’d like to hang out with, and I’m sure that Coben would be impressed with all of the time and effort and creativity that went into naming my blog – Borden’s Blog, as well as my Twitter handle – @jimborden

One fun fact I learned is that he played Little League baseball with Chris Christie, and they have remained friends to this day (despite differing political views.)

I’ve also learned that Coben is a prolific author, and he has written several other novels besides the Myron Bolitar series. I plan to read his other books as well, but not in such an obsessive way.

As I’ve noted many times, I’m often late to the game when it comes to pop culture, and the same is true here. Coben’s first novel was written in 1990, but I just heard about him this past summer.

I’ve tried to make up for lost time, and I hope to be all caught up within a year. At that point, it will be nice to just look forward to reading the new book Coben publishes each year. That seems like a much more civilized way to enjoy an author.

So thank you Mr. Coben for sharing your writing gift with the world, and I wish you continued success (since I will directly benefit from such success).

Next up: Tell No One.