On the London Underground, you don’t need to decide whether it makes more sense to buy an individual ticket or to buy a daily or a weekly or a monthly pass. With the Oyster card, you just tap in and tap out around the system, and it charges you whatever’s cheapest. You only make one journey? You only get charged for one journey. The minute that your journeys in one day add up to more than the daily-pass rate, you get charged the daily-pass rate, and no more. Similarly for your journeys in one week, with the weekly pass. And so on. Really, there’s only one plan, and there’s no way to get inadvertently ripped off.
Wcw explains the economics of the housing bubble, in a smart comment:
As for borrowing the money, I think the folks who did so did absolutely the right thing. When someone offers you a government-subsidized non-recourse loan on an appreciating asset, they’re giving you a put option. The more you borrow and the less you put down, the more that option is worth. These borrowers maximized their leverage. The market turned, and they exercised their put options. They are not the dumb ones, they are the smart ones. The dumb ones are the ones who gave away the farm lending this money.
From a PR point of view — and Warren Buffett cares deeply about his public image — yesterday was arguably the single worst day of Buffett’s life. He was dragged against his will — with a subpoena, no less — in front of the Financial Crisis Inquiry Commission, which grilled him on whether, as Moody’s largest shareholder, he took any responsibility at all for the disaster that happened there. His answer — no — was met with unanimous derision, both in the mainstream media and in the blogosphere: see The Pragmatic Capitalist, or Bond Girl (“It’s funny how heroes end up cutting themselves down to size even when no one else can”), or Edmund Andrews:
I spent most of this afternoon attending a fascinating discussion looking at Greece from the perspective of emerging-market veterans who are used to sovereign debt default and restructurings. There was quite a lot of consensus on the panel, and not in a good way: everybody agreed that the bailout of Greece was only postponing the inevitable, and many people reckoned that it wasn’t going to postpone it very long: one pair of hedge fund managers in the audience reckoned that it would last about six months before the default finally happens.
I recorded a lively sit-down discussion today with Charles Komanoff, the subject of my Wired article; Reihan Salam; Skymeter CEO Kamal Hassan; and Corey Bearak of Keep NYC Free. We were safely ensconced in Reuters’s fourth-floor studio overlooking the traffic of Times Square, and the full talk should be available on Friday. But here’s a couple of teasers, courtesy of Hassan: firstly, might it be possible to implement a de facto congestion-pricing scheme using only parking fees, with no fees for driving? Is that the way Chicago is headed? And secondly, did you know that after London implemented its Congestion Charge, subway ridership went down, rather than up?
Shahien Nasiripour has found an interesting report from the Federal Reserve, looking at whether the credit-card rules which apply to individuals should apply to small businesses as well. The Fed, weirdly, fudges the question, but it’s clear to me that small businesses deserve all the same protections that individuals get.
I talked about “Jingle Mail 2.0” on Tech Ticker this morning, and Henry Blodget made the good point that freeing up mortgage payments for small-business operating expenses or consumer goods does provide a short-term boost to the economy — at the expense, of course, of banks’ balance sheets.