I am still here but I have been busy with work and trying out some new things in regards to the market. A couple of quick takes for perusal.
No One Asked Me
Full disclosure: I do not have a position in the company (not a GS client) and I do not have an account. My wife has one (bejeweled blitz is an issue) and so does my pug (don't ask!).
With that out of the way here are the main Facebook users such that I can figure from real life interviews:
- 20% People with kids that post endless pictures that only they and their immediate family will care about plus a few weirdos
- 50% Men (married, single, on parole) that are looking for long lost loves, former flings, and just some action. Plus they are scanning all the pictures and doing who knows what
- 20% Women (married, single, on parole) doing the same as above
- 5% Normal people with accounts addicted to the games offered
- 4% Advertisers looking for data
- 1% Other
Indeed, amazing stuff! It is like, well, the Internet only somewhat smaller. Look, I get it. It's hot, it's smoking. Great. In 5 years all the ads will be kiddie stuff and porn. Where is the money coming from? This thing costs close to zero to run (like Google) but it is also easily replicated and may suffer first in class fatigue. Didn't everyone have a My-Space at one point?
50 Billion net worth? Why not 100 Billion? Why not make it like Apple Inc? People getting in touch with people is a novel idea after all. Otherwise you could go out and talk to people or meet up with folks. Maybe you could even meet new people in a social setting without your entire ISP and address showing up! This thing is built to last! Sorry for the snark.
What You Talking About Willis!??
When things get nuts they tend to proceed toward absolute entropy it seems. All I will submit is a Business Insider headline:
The Truth Comes Out: Paul Volcker Was Forced Out, Because The White House Is Going More "Pro Business"
Not sure how more "Pro-Business" this government can get and by that it means PRO-BANKING and we all know it and accept it like meek wounded in the basement in "The Road" waiting to be eaten but whatever.
Indeud.
Any more Banker, I mean Business friendly, and they will uproot all the trees around DC to make an army of Orcs and Uruk-hai to battle us for credit card fees and minimum balance transgressions. Geez.
Have a good night. And a sword by your side may come in handy!
What most people don't understand about banking is how it really works.
ReplyDeleteA banker makes a loan, say a mortgage, for $100,000 on a 30-year note. At 5% the total amount of interest generated after full amortization is $97,000. So over the next 30 years, the bank will be repaid the principal and earn nearly as much in interest.
However, the banker counts that $197,000 as income this year, even though it won't be realized for three decades, and pays himself a bonus based on that amount. Thus, the bank earns an origination fee, usually 1 or 2%, and the banker earns a bonus, then sells the note to an investor so if it defaults no money is lost. The bank and the banker have already been paid, while the investor assumes all the risk.
The costs involved in foreclosure on a delinquent note are significant. And the expenses involved with repossession and resale (maintenance, utilities, repairs, taxes, commissions, closing costs) are severe. You're looking at a loss of 50% or more on your investment should the borrower default.
But neither the bank nor the banker care about that. They made their money. Why should they be concerned if the investor loses his shirt?
This is the root of the problem.
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