Herding Cats: Social Security Ponzi Scheme, UBS Rogue Trader and Transumerists
Image courtesy of ICanHasCheezburger
This week we have the UBS fraud, Ponzi Schemes, Chinese Angry Birds, Transumerists, how to buy cheap things and teaching kids about money. Do we have a cat video this week? Nope: Chuck Testa.
Business Week: UBS Trader Adoboli Charged With Fraud, False Accounting – A trader took UBS for a $2 billion loss, and so far he’s getting most of the blame. But it says something about a company where one 31-year-old trader is able to play around with that kind of money. That suggests something’s wrong with the system, not just one fraudster. So chances are the culprit here isn’t just the trader, but the oversight process in general.
Wisebread: Social Security Is Not a Ponzi Scheme – That’s a pretty attention-grabbing headline, especially if you’re a Rick Perry supporter. But there is an important point being made. Even if Social Security needs reform to be sustainable into the future, calling it a fraud is a leap. It’s not a system set up to steal people’s money, because ideally they’ll get it back. That’s not how a Ponzi Scheme works, so calling it something that amounts to a criminal enterprise is hyperbole. Good debate in the comments.
CBS News: China steals “Angry Birds” for theme park – This Angry Birds attraction in China is pretty cool, but may be equally as frustrating as the app–especially the idea of having to manually rebuild the structure every time it’s knocked down. Fortunately, no one seems to be able to do this. But this actually poses a bigger problem: China has been using brand names without approval, leading to copyright problems. The best part may be this explanation from a park official–imagine something like this said about Disneyland: “This serves as a method for people to purge themselves and to gain happiness.”
PerkStreet: Transumerism: How Buying Less Can Mean Wasting More – New term for me: transumerism. People who don’t want to own things and instead rent, or otherwise try to find ways to have items for the short-term. The downside: actually spending more for renting something than you would ever buy. So you rent a Ferrari instead of buying a Corolla. Makes sense, but we’re becoming a more transumerist culture. I’ve been using Spotify recently: for $10 a month, you can have access to thousands of albums. I don’t “own” any of these, but I don’t need to. This is the direction a lot of consumer culture is going.
Bargaineering: Kids & Money: Help Your Kids Avoid Materialism – Good post. I’m very sensitive to these sorts of issues. I’ve been filling up my daughter’s iPod and was putting on the Beatles “Magical Mystery Tour” and deleted “Baby You’re a Rich Man” because of the lyrics, “How does it feel to be one of the beautiful people?” It’s meant ironically, but to a kid it might seem like an endorsement of beauty being more important than everything else. Am I being overprotective? Probably–but just putting this out there that small messages can have a big impact. Oh, I also didn’t put on “Blue Jay Way” because it creeps her out.
Mint: When Cheaper Isn’t Always Better – Some good tips here too–especially considering cheap can be dangerous when it comes to cheap drugs. Also factor in how long something will last. This ties into the above post as well. It makes little sense to buy kids overly expensive clothes because they’ll 1. wear them out quickly and 2. grow out of them quickly. Adding 3. it could also enhance that feeling of materialism that you want to avoid. What kid needs a $40 t-shirt to go to school? Honestly, $20 is too much.
How about you–any tips for teaching kids good values about money?
No cat video this week. Instead, dead, stuffed animals. The latest viral sensation: Chuck Testa.