1. Off the Books: The Underground Economy of the Urban Poor
In this revealing study of a Southside Chicago neighborhood, sociologist Venkatesh opens a window on how the poor live. Focusing on domestics, entrepreneurs, hustlers, preachers and gangs linked in an underground economy that “manages to touch all households,” the book reveals how residents struggle between “their desires to live a just life and their needs to make ends meet as best they can.” In this milieu, African-American mechanics, painters, hairdressers, musicians and informal security guards are linked to prostitutes, drug dealers, gun dealers and car thieves in illegal enterprises that even police and politicians are involved in, though not all are criminals in the usual sense. Storefront clergy, often dependent “on the underground for their own livelihood,” serve as mediators and brokers between individuals and gang members, who have “insinuated themselvesāand their drug moneyāinto the deepest reaches of the community.” Although the book’s academic tenor is occasionally wearying, Venkatesh keeps his work vital and poignant by using the words of his subjects, who are as dependent on this intricate web as they are fearful of its dangers.
2. Freakonomics: A Rogue Economist Explores the Hidden Side of Everything
Economics is not widely considered to be one of the sexier sciences. The annual Nobel Prize winner in that field never receives as much publicity as his or her compatriots in peace, literature, or physics. But if such slights are based on the notion that economics is dull, or that economists are concerned only with finance itself, Steven D. Levitt will change some minds. In Freakonomics (written with Stephen J. Dubner), Levitt argues that many apparent mysteries of everyday life don’t need to be so mysterious: they could be illuminated and made even more fascinating by asking the right questions and drawing connections. For example, Levitt traces the drop in violent crime rates to a drop in violent criminals and, digging further, to the Roe v. Wade decision that preempted the existence of some people who would be born to poverty and hardship. Elsewhere, by analyzing data gathered from inner-city Chicago drug-dealing gangs, Levitt outlines a corporate structure much like McDonald’s, where the top bosses make great money while scores of underlings make something below minimum wage. And in a section that may alarm or relieve worried parents, Levitt argues that parenting methods don’t really matter much and that a backyard swimming pool is much more dangerous than a gun. These enlightening chapters are separated by effusive passages from Dubner’s 2003 profile of Levitt in The New York Times Magazine, which led to the book being written. In a book filled with bold logic, such back-patting veers Freakonomics, however briefly, away from what Levitt actually has to say. Although maybe there’s a good economic reason for that too, and we’re just not getting it yet.
3. Ragnar’s Guide to the Underground Economy
Through detailed case studies Ragnar shows you how carpenters, woodcutters, farmers, housecleaners, computer consultants, mechanics, lawyers, vendors, locksmiths and others are cashing in on today’s booming economy - and keeping what they earn by not paying taxes. From these undergrounders you’ll learn how to locate work, get paid without supplying identifying numbers, prepare a realistic budget, advertise your services or product and finance your project when you can’t go to the bank. You’ll also learn the pitfalls of working off the books and what you can do to prepare for them.
4. How to Survive Without a Salary: Learning How to Live the Conserver Lifestyle
I thought that this book was so funny in places that I haven’t laughed so hard, so much, for a long time. Charles is a skilled writer; the book is very readable, intelligent, thoughtful,and well organized. It contains a copious (even prodigious) amount of tips, for a 200-page book. Very practical, and at the same time touches on abtruse philosophical areas, especially at the end of the book.
Hey, I used to think I was cheap. This guy is CHEAP. His anecdotes include waiting for it to rain to take a shower instead of installing indoor plumbing. He had a big hole in the floor of his entryway, or somewhere in his house, into which the kids and a few guests fell. He refused to spend one cent covering the hole, until a neighbor told him about a steel grate they threw away years ago, so he went to the dump and found it.
The point is that you can learn from a top-notch “conserver”; an applied example I would give is to buy two gallons of milk when it’s on sale and freeze one for later use (works well!). This guy probably drinks powdered milk though.
I disagree with his economic analysis; prudence CAN be a vice, as any virtue most certainly is in its extreme, or even overdone. But Adam Smith’s Wealth of Nations is not just about “McPimple Burger” or keeping up with the Joneses. Any system on a mass scale is going to have gaping faults, and the weaker of us might succumb to our basest impulses. But perhaps Long goes a bit too far the other way…
At any rate, he sounds like an economic anarchist. Very well thought out book, great advice.
5. Gang Leader for a Day: A Rogue Sociologist Takes to the Streets
In Freakonomics, many people were fascinated by a section that described how most crack cocaine dealers lived at home with their mothers. Why? They make less money than minimum wage. The source of that factoid was research conducted on site by Sudhir Venkatesh, author of Gang Leader for a Day, who describes in this book how he did that research and came to make decisions one day for part of the Black Kings gang in Chicago.
In the process of reading this book, you’ll learn more than you ever expected to know about the ways that the poorest people support and protect themselves. You’ll also find how drug-dealing gangs are both a help and a hindrance to the poor.
More powerfully, you’ll be exposed to the great difficulties involved in observing the lives of the poor and the gangs that spring from them. The moral and ethical dilemmas this book presents are almost beyond belief.
6. Under the Table and Into Your Pocket: The How and Why of the Underground Economy
Under The Table And Into Your Pocket: The How And Why Of The Underground Economy by Bill Wilson will provide the non-specialist general reader with a complete education on a facet of the American economy rarely (if ever) covered in school. Beginning with an introduction to just some of the ways governmental regulations strangle business, overtax the little guy, and enable Washington to be the drunken big spender that it is today (if you overpay your taxes by $7,000 and don’t reclaim it within three years you’re out of luck - but underpay it by $7,000 and the IRS can and will come after you no matter how much time has passed!), Under The Table proceeds to demonstrate how the little guy can circumvent taxes by doing business away from Big Brother’s prying eyes. From boarding houses and flea markets to roadside merchants and dominatrix work, Under The Table covers the benefits, disadvantages, tips, tricks, techniques and much more of common underground ways to earn a living. Under The Table is emphatically not a legal guide; neither the author nor the publisher assume any responsibility for the use or misuse of information contained within - but the eye-opening ins and outs of a truly free economy make for quite fascinating and advantageous reading.
Are you fed up with giving so much of your hard earned cash to the government, then watching it get spent on ridiculous pork-barrel special-interest projects? Would you like to hold on to more of your money for your own special-interest boondoggles? The underground economy continues to grow in spite of ever-widening atttempts by the government to regulate and tax everything we do. Millions of Americans are practising fee enterprise in today’s increasingly unfree tax society. This is the most comprehensive how-to book ever written for those entrepreneurial individuals who have decided to end their slavery to a wage and to government taxation as well. Discover how you can keep more of what you earn for yourself. Here you will find complete and up-to-date information on the ins and outs of guerrilla capitalism and the underground economy in this country.
In December of 2001 Jeff Ferrell quit his job as tenured professor, moved back to his hometown of Fort Worth, Texas, and, with a place to live but no real income, began an eight-month odyssey of essentially living off of the street. Empire of Scrounge tells the story of this unusual journey into the often illicit worlds of scrounging, recycling, and second-hand living. Existing as a dumpster diver and trash picker, Ferrell adopted a way of life that was both field research and free-form survival. Riding around on his scrounged BMX bicycle, Ferrell investigated the million-dollar mansions, working-class neighborhoods, middle class suburbs, industrial and commercial strips, and the large downtown area, where he found countless discarded treasures, from unopened presents and new clothes to scrap metal and even food.
9. McMafia: A Journey Through the Global Criminal Underworld
In McMafia, Misha Glenny draws the dark map that lies on the other side of Tom Friedman’s bright flat world. That connected globe not only brings software coders and supply-chain outsourcers closer together; it’s also opened the gates to a criminal network of unsettling vastness, complexity, and efficiency that represents a fifth of the earth’s economy, trading in everything from untaxed cigarettes and the usual narcotics to human lives and nuclear material. Glenny’s a Balkans expert, and he begins his story there, with the illicit–but often state-sponsored–underworld that grew out of the post-Soviet chaos, but he soon follows the contraband everywhere from Mumbai and Johannesburg to rural Colombia and the U.S. suburbs. It’s not just a hodgepodge of scare clips, though: Glenny reports from the ground but follows the leads as high as they go, showing how the dark and bright sides of the flat world are more connected than we imagine.
10. Living Well on Practically Nothing
Living Well on Practically Nothing: Revised and Updated Edition is for people who need to live on a lot less money. If you have been fired, demoted, retired, divorced, widowed, bankrupted or swindled - or you just want to quit your job and remain financially self-reliant - this book is for you. In it are hundreds of tips, secrets and necessary skills for living well on little money. Chapters include: Save Up to $37,000 a Year and Live on $12,000 a Year; Low-Cost Computers for Fun, Profit, and Education; Some Ways to Live on No Money at All; A Day of Cheap Living; A New Career or Business for You; Fix Things and Make Them Last; and Protect Your Investments and Make Them Grow. From cover to cover, this book is stocked with proven methods for saving money on shelter, food, clothing, transportation, entertainment, health care and more. The author left the “system” in 1969 and has worked for himself ever since. Let him show you how you, too, can live happily, comfortably and with complete financial freedom.
P.S. If you’d like to know how I make my money (it’s not really “shadow” or illegal at all, but it give me freedom to do anything I want to, while providing steady stream of income), feel free to check out my websites - PickyDomains.com, NicheGeek.Com, StandupKings.com, SoftwareJudge.Com, Best Free Documentaries.
Link of the day - I will pay you $25, if you come up with a cool domain name for me.
A T-shirt has become one of the most popular items sold by online retailer Amazon in the past few weeks.
Sales of the kitsch Three Wolf Moon T-shirt shot up 2,300% after a spate of ironic reviews went viral.
The first review gave the shirt five stars, saying it “Fits my girthy frame, has wolves on it, attracts women” but “cannot see wolves with arms crossed”.
That prompted hundreds of others to post frivolous reviews, turning the page into an internet phenomenon.
“When I put this T-shirt on for the first time, my wife left me! Thank you, Three Wolf Moon T-Shirt,” wrote one wag, while another said that “the Three Wolf Moon T-Shirt gave me a +10 resistance to energy attacks, +8 Strength… and I have successfully solved 7 crimes in my city”.
Amazon’s senior manager of community content, Russell Dicker, said the T-shirt was currently the top selling item in their clothing store.
“The Three Wolf Moon T-Shirt recently moved up 2,300% in sales rank,” he said. “We are grateful that our reviewers are so passionate.”
Publicity shy
However, the firm which actually makes the T-shirt appeared less than pleased at some of the comments.
“The Mountain is a wholesale company and does not sell shirts on Amazon, so this viral assault went under our radar until the shirt made it into the top 10 in the Amazon apparel section,” they said in a posting on the Amazon site.
“We appreciate humour as much as the next company, but we don’t approve of some of the remarks.
“Not everyone can start out at the top and not everyone from our neck of the woods lives in a trailer or cruises Walmart to hook up.”
However, speaking on Radio Five Live, the firms art director - Michael McGloin - said the firm were actually rather pleased with the publicity.
“We’ll take ironic fashion any day…. and we’re printing another 400,000 more t-shirts…it’s just a fantastic thing,” he said.
This is not the first time comedy reviews on Amazon have gone viral. In 2006, there were more than a thousand reviews for Tuscan Whole Milk.
They ranged from soap opera-style script - “That was when I knew. He was tired of this life with me, tired of bringing home the Tuscan Whole Milk, 1 Gallon, 128 fl oz” - to stating the obvious: “Has anyone else tried pouring this stuff over dry cereal? A-W-E-S-O-M-E!”
[Via - UncommonBusiness Blog]
Crazy Business Ideas - WeShootBottles.Com
How the man in a van outsmarted Microsoft
As thrifty customers turn to secondhand goods, resale stores are profiting from the recession.
Link of the day - Win Free XBOX 360
As recently as February of this year, Russian officials cleared the way for two of its sovereign wealth funds, the Reserve Fund and National Wellbeing Fund, to invest in various foreign bonds, including those issued by the twin towers of American residential finance, Fannie and Freddie.
“The prospect for every GSE bond clearly states that it is not backed by the United States government,” says Matt Kibbe, president of FreedomWorks. “That’s why investors holding agency bonds already receive a significant risk premium over Treasuries.”
The Russians ignored the warnings and grabbed the risk premium. Today, fully 21% of Russia’s monetary reserves are invested in the obligations of Fannie, Freddie and the Home Loan Banks. And the largest holder of Fannie and Freddie debt is another friendly foreigner, China. The middle kingdom, according to the FreedomWorks organization, owns $376 billion worth of U.S. agency bonds. Altogether, foreigners hold $1.3 trillion of them.
Maybe the foreigners didn’t understand what they were getting into. Or maybe they did.
Franklin Delano Roosevelt, whose family had made a fortune in the opium trade, promised the nation a “New Deal” during the Great Depression of the ’30s. But what he gave it was more like the old false shuffle. The president pulled cards from the bottom of the deck, pretending that government bureaucrats could do a better job of allocating capital than private investors. In 1938, he set up the Federal National Mortgage Association, b.k.a. Fannie Mae. Then, as now, the national housing market was in crisis. House prices had been declining for almost a decade. Who wanted to lend money against falling collateral values? Only a foolā¦or a government.
For the next 32 years, the firm resembled a nationwide savings and loan institution — borrowing from large institutions and lending to smaller ones, keeping a piece of the spread for its trouble. But Fannie Mae was an imposter from the get-go. Lenders knew that it had something no free market business ever had - the full faith and credit of the US government behind it. Fannie was able to borrow at below-market rates; lenders knew they had no risk of losing their money in a default or bankruptcy. Fannie, with the aces dealt her by the Roosevelt administration, dominated the business for the next 30 years.
Then, another crisis came along, followed by another bamboozle, this one perpetrated by Lyndon Johnson. Specifically, the feds were spending too much on wars - the War on Poverty at homeā¦and one against the Viet Cong across the ocean. Victory eluded Lyndon Johnson on both fronts, but his handling of Fannie Mae should have brought him at least a bronze star. Attempting to balance the government’s ledgers (this was in the days when Americans still believed in balanced budgets), he moved the mortgage business off of the Federal government’s books, privatizing it as a ‘government sponsored agency.’ For good measure, he created a competing organization - the Federal Home Mortgage Association, b.k.a. Freddie Mac.
Many are the ham-fisted dictators and sticky-fingered kleptocrats who have nationalized industries. Even without a credit crunch for camouflage, Francois Mitterand nationalized 36 leading French banks in 1982. Robert Mugabe grabbed farmland in the Zimbabwe. Evo Morales took the gas industry. And Hugo Chavez seized the Orinoco oil fields in 2007. But Lyndon Johnson rarely gets credit for his great advance in the history of public larceny: he privatized the profits while nationalizing the losses. This formula has been a honey pot for clever dirigistes ever since, providing countless opportunities for defeated politicians, hacks and hustlers - speaking fees, consulting contracts, board memberships, bonuses, stock options (notably, the $170 million spent on lobbyists over the past 10 yearsā¦mentioned above) - things that wouldn’t be possible for a “public” company. In effect, Fannie Mae could pick the taxpayer’s pocket twice - once by sticking him with a mortgage he couldn’t really afford and a second time by raiding the taxpayers’ vault for a bailout.
In the case at hand, by the year 2007, the CEOs of Fannie and Freddie were earning salaries that would have been respectable, even on Wall Street. Fannie’s main man, Daniel Mudd took home $13.4 million in 2007, a year in which the firm lost $2.1 billion. While the Freddie Kruger of mortgage finance, Dick Syron, pocketed $18.3 for helping Freddie Mac to a $3 billion loss and a 33% trim for the shareholders.
As recently as May of this year, Mr. Mudd told the New York Times that he was “seeing the best opportunities since I’ve been in this business.” Two months later, both Fannie and Freddie are “insolvent,” says former Fed governor William Poole.
In a better world, Mudd and Syron would be hangedā¦and the bondholders would be wiped out along with the shareholders. But last Sunday, U.S. Treasury Secretary Henry Paulson announced a bailout. And on Monday, an auction of Freddie Mac debt was oversubscribed. The Russians were right; the deck was stacked from the very beginning.
Enjoy your weekend,
Bill Bonner
The Daily Reckoning
How To Get Media Attention? Just Say āGreen,ā āSex,ā āCancer,ā āSecretā Or āFatā
Link of the day - Free $50 Kmart card.1. Sway: The Irresistible Pull of Irrational Behavior
Why is it so difficult to sell a plummeting stock or end a doomed relationship? Why do we listen to advice just because it came from someone āimportantā? Why are we more likely to fall in love when thereās danger involved? In Sway, renowned organizational thinker Ori Brafman and his brother, psychologist Rom Brafman, answer all these questions and more.
Sway introduces us to the Harvard Business School professor who got his students to pay $204 for a $20 bill, the head of airline safety whose disregard for his years of training led to the transformation of an entire industry, and the football coach who turned conventional strategy on its head to lead his team to victory. We also learn the curse of the NBA draft, discover why interviews are a terrible way to gauge future job performance, and go inside a session with the Supreme Court to see how the worldās most powerful justices avoid the dangers of group dynamics.
2. Predictably Irrational: The Hidden Forces That Shape Our Decisions
What Ariely has done here is shift a lot of the thinking developed by such pioneers as Kahneman & Tversky who worked in behavioural economics, and moved it into the everyday sphere. And he’s done a great, insightful job. Where the behavioural economists are focused on financial decisions (why we buy high and sell low - and confound the assumptions of the classic economists who assume ‘the rational man,) Ariely eschews the technical language and walks us through everyday examples of our often fuzzy and quite irrational decision-making.
3. The Paradox of Choice: Why More Is Less
I think “Paradox of Choice” does bring insight into shopping, but its range is actually much wider than that. Schwartz discusses people making difficult decisions about jobs, families, where to live, whether to have children, how to spend recreational time, choosing colleges, etc. He talks about why making these decisions today is much harder than it was 30 years ago, and he offers many practical suggestions for how to address decision-making so that it creates less stress and more happiness. He even discusses how so much additional choice affects children, and how parents can help make childhood (particularly young childhood) less stressful.
4. Nudge: Improving Decisions About Health, Wealth, and Happiness
“Buy on apples, sell on cheese” is an old proverb among wine merchants. Taking a bite of an apple before tasting wine makes it easier to detect flaws in the wine, and the buyer who does so will not as easily make the mistake of paying more than the wine is worth. Cheese, on the other hand, pairs well with wine and enhances its flavor, so a seller who offers cheese may command a higher price for the wine (and may even deserve it, if the wine is intended to be drunk with cheese). The proverb captures important psychological nuances of choice. The same product - a bottle of wine or a risky medical procedure - may be perceived differently depending on its context, and it is often possible to arrange the context to influence a choice while still maintaining the decision maker’s autonomy.
5. Quirkology: How We Discover the Big Truths in Small Things
Richard Wiseman is an experimental psychologist and professor of “public understanding of psychology.” In this book, he discusses dozens of experiments performed by himself and other psychologists around the world over the course of the last hundred years. All these experiments have in common is unusual research methodology or amusing results.
Topics include studies of personal ads and pickup lines, determining which are most effective, how to detect liars, manifestations of prejudice and hypocrisy (are religious people or priests more honest or generous than others? it has been tested). Wiseman even ran tests to see which experiments in the book are the most interesting, to help the reader know what would be the best conversation starters at parties.
6. Blind Spots: Why Smart People Do Dumb Things
Clinical psychologist Van Hecke has compiled a list of 10 mental glitches that have infiltrated contemporary society, afflicting even the smartest among us, limiting thought, success and relationships. Van Hecke devotes a chapter to each blind spot, including “Not stopping to think,” “Not noticing,” “Jumping to conclusions” and “Missing the big picture.” Examining each in detail, Van Hecke details the root causes of these unconscious habits (”information overload,” “our tendency to habituate”) and tactics for overcoming them, using humorous anecdotes and other real-life examples to drive her points; the key is remaining open to new ideas and taking a step back from our busy lives in order to process information, situations and people. Filling in “the big picture” herself, Van Hecke demonstrates how embracing and understanding our weaknesses can not only improve personal and professional relationships, but also entire communities; this self-help is a welcome, highly readable first step.
7. Kluge: The Haphazard Construction of the Human Mind
In “Kluge,” psychologist Gary Marcus looks to the many and varied foibles, inconsistencies, and inaccuracies of the human mind and concludes that our brains are not, in fact, models of brilliance and efficiency, but are rather cobbled-together systems, designed for one purpose and pressed into action for another - the classic definition of a kluge.
The most famous kluge is probably the case of the carbon scrubbers on the ill-fated Apollo 13 mission. Crunched for time, engineers managed to create a system out of duct tape and socks (seriously) that worked adequately enough to clean the air on the space module- even though none of the materials they used were designed for, or optimal for, the job at hand. The result was ugly and inefficient - but it kept the astronauts alive. Likewise, Marcus argues, evolution has endowed humans with a hodgepodge of genetic material - the DNA equivalent of duct tape - with which to build all the sophisticated systems that supposedly set us apart from other creatures, like language, memory, and reason. The result is, for example in the case of language, “a vocal apparatus more byzantine than a bagpipe made up entirely of pipe cleaners and cardboard dowels.”
8. The Drunkard’s Walk: How Randomness Rules Our Lives
The author writes to the layman, making the language of statistics, probability, randomness a fascinating read. It’s clear that he’s well aware of the fallacies and delusions (and consequent harm) to which most of us are easy prey. But he leaves it to the reader to draw any philosophical-theological inferences about the need for greater humility. His immediate goal is to help the reader understand the distinction between 1. the “common-sense” logic employed by self-serving finite beings coping with problems in the material world and 2. a “scientific method” that takes nothing for granted in a universe of perpetual flux. More miraculous than either the accomplishments of the romantic hero or the intercessions of a supreme being (everyday stuff for most of us) is the rare discovery that two things (or “events” in the spatial-temporal order) suspected of being connected (a hypothesis) in fact cannot be shown “not” to have such a relationship (the proof).
9. Guesstimation: Solving the World’s Problems on the Back of a Cocktail Napkin
Somehow, guessing at numbers is unsettling, even though I’ve done it all my life. John Adam is a professor of applied mathematics, with a degree in physics. Larry Weinstein is a nuclear physicist. Their book is devoted to proving that intelligent guessing is useful and fun. The book lays out some general principles but its great strength lies in the interesting problems, a series of hints to help you solve each problem, and an interesting discussion of the pitfalls and triumphs involved.
10. Influence: The Psychology of Persuasion
Cialdini believes that influence is a science. This idea attracted me. As a rhetorician, I have always thought of persuasion as more of an art. Cialdini, however, makes a first-rate case for the science point of view. But maybe most importantly, he makes his case in a well-written, intelligent, and entertaining manner. Not only is this an important book to read, it is a fun book to read too.
He introduces you to six principles of ethical persuasion: reciprocity, scarcity, liking, authority, social proof, and commitment/consistency. A chapter is devoted to each and you quickly see why Cialdini looks at influence as a science. Each principle is backed by social scientific testing and restesting. Each chapter is also filled with interesting examples that help you see how each principle can be applied. By the end of the book, I had little doubt that these are six important dimensions of human interaction.
Fart Gene Isolated. Now, That’s A Breakthough!
Mariage Annulled, After Bride Turns Out To Be Not A Virgin.