Bill Tozier drew my attention to a most excellent term of art, Daniel C. Hallin’s phrase Sphere of Deviance.  That posting has the nice insight that Jon Steward makes his living in the border lands were legitimate controversy meets the deviance.

Hillard was mapping the world of national discourse, i.e. old school journalism, during the period when the consensus about Vietnam war imploded.   But this framework is universally applicable.  For example Open Source, as a tool for enterprise software development has traveled over the last decade all the way into the center.   Freudian analysis has travel out.  Some ideas orbit the consensus like comets; i.e. the fetish for solving all problems with unregulated markets.

It’s fun to take a topic (peak oil, diets, business plans) and map the various ideas and players along with their trajectories onto that drawing.

For some reason this all reminds me of how the distant periphery of cities has always been where you find the real nut case cults hanging out.

The New York Times has yet another piece on the question of walking away from underwater mortgages, this time an op-ed by Richard Thaler.  It finally references the excellent essay by Brent White on the current “norm asymmetry” between the mortgage holders and mortgage holders; i.e. one side ethics & roots while the other has only spreadsheets.  I wrote about that a while back.

These pieces all seem to presume that the underwater owners can continue to tread water.  That’s crazy talk.    These mortgages are fundamentally unsound.  A sound mortgage requires a few key elements.  It needs to be backed by appropriate collateral, and these aren’t.    It’s servicing must tap only a reasonable percentage of the holder’s income stream, and these don’t.  It needs to be reasonably liquid, i.e. that should the situation arise the mortgage holder can sell the instrument and/or the home owner can sell the house; and these aren’t liquid, not at all.

So what we have here is a standard bubble situation.  i.e. “What can’t go on won’t.”  Sooner or later these people will walk.  The only question is how much damage to their family’s economic status they take before they do.

I continue to think there is money to be made here.  An entrepreneurial opportunity: a business that facilitates the walk always.  At it’s core all it does is loan people money to fund their walking away; i.e. bit of legal cost, a lump sum to pay for rental deposits, maybe some moving expenses.  I wonder how many landlords are willing to let you put the 3 months rent worth of deposits on your credit card?

What I find fascinating about this idea is who it turns the question of borrower honor on it’s head.    For these walk-away enabling loans to work you need trust.  They are personal loans.  The business works because it accepts that you can trust somebody who walks away.  The business accepts that they are not dishonorable, but rather that they are pragmatic.  It works because by splitting the benefit of that pragmatism with them.  I love that.

Further I love that such a business would have to do what the bubble lenders failed to do.  It would actually need to know the customers.  If you wanted to set up such a business you’d need to have local knowledge of the customer’s actual situation.  You’d need to be able see through his lousy existing cash flow and recognize that if his income stream is stable and that as soon as his housing costs drop by a thousand dollars a month paying off this new loan is going to be straight forward.  Maybe you could hire all the loan officers who learned their trade in the years before the bubble.    Maybe this is business model to be sold to small banks where their local knowlege can be brought to bear.

I can’t quite capture it, but the key is in there someplace.  The original lenders didn’t bother to figure out who was trustworthy.  (They didn’t need to since they could offload the risk immediately.)    Now if somebody shows up willing to do that work they can profit from it.    Curiously, the longer an underwater home owner tread water the more you can trust him.

Update: I suspect this mortgage holder wasn’t actually living in there.

I switched my home’s phones to a cell phone back in August.  This post outlines what I did.

For the old phone line I had what I think was the cheapest service available.  The service was maybe 17$/month, but the confusopoly charges ran the bill up to about $34/month.  So a years service was costing me abour $400 dollars.  In addition to that I was buying my long distance service from yet another vendor so my total phone cost was about $450/year along with about 14 transaction events to handle the billing.

What I did was by a two pieces of capital equipment, a used cell phone and a clever widget that bridges from the cell phone to the existing in house phone wiring.  That capital equipment cost me about $100 total.  I then switched the phone number to Page Plus Cellular.  Page Plus Cellular is a Mobile Virtual Network Operator, or MVNO.  It stands on the physical network of Verizon Cellular.    While MVNO is the technical term for this, most people just say “Prepaid.”

Cell phone minutes are cheap on Page Plus.  When I set this up they were six cents each (if you buy them in $80 batches), now they are four cents each.  I estimate that the annual cost for the minutes we use is about $250/year, e.g. ~ $20/month.  I have to top up the account four times a year; so there are 4 transactions to handle/year.

So in the first year I’ll save about a hundred dollars have ten fewer transactions.  In next year I’ll save $200.

I think the quality is great, we occasionally get lousy connections but so far i haven’t had one were I couldn’t blame the counter party’s cell phone.  I guess it could count as a feature that I can take the home phone with us when we travel.

But over all this just is not that big a savings.

I appreciate at there are other schemes that use your internet connection.  I didn’t go down that route for three reasons.  I’ve had a hard time getting dependable quality with internet phone.  I didn’t want to get the two services entangled with each other.  It’s not clear if it would have been cheaper without taking on significantly more risk and support costs for me.

Because this cell phone doesn’t move I could presumably buy my minutes from one of the more marginal physical cell phone companies (say Metro PCS).  Suprisingly they don’t offer something cheaper.  But if something cheaper comes along I switch after spending down my current basket of minutes.

Update Sept 2012: I think I’m spending about 5-10$ a month; but yeah we don’t use the land land much.

Ha!  This had not occured to me before.  If you use smart phone (even a very cheap one) you can install google voice on the smart phone and then have the phone route your international calls thru that; which is very cheap.

This piece was born as the sound track for a cartoon.  The company that pulled it together provides sound tracks.  Lots of over the top musical effects for your B movies.  None the less it’s fun.

I don’t like list songs.  But, now days when ever I hear a song based on a list I think about the password generating trick of using a list, say bpnpbw (Boston, Providence, New York, …); so maybe he’s revealing his password?

That monster with it’s smoke, chorus, strings, sweaty sexy rocker reminded me of the rule of thumb that it’s tacky to use white paint in an oil painting.  I bet there is a “tacky” list for every art form.

Ned Gully wrote a delightful bit recently on the puzzle of when to cheerfully let the vendor manipulate your inner animal.   I agree with his example. but still I can’t resist highlighting that he admits to being the vendor.  The vendor always thinks the customer should unleash his inner animal.

A while back the Times has an article about manipulative consumer research used to design of restaurant menus.  For example, always pull the family values cord: “Uncle Juan’s Haggas.”  Of course the article’s full of the same rhetotical dabs of white paint: “The company hired Gregg Rapp, a menu engineer and consultant who holds “menu boot camps” for restaurants around the country. He said he had been “taking dollar signs off menus for 25 years,”.”  Boot camps!

I think it was Bruce Schneier who invented the delightful term Security Theater to highlight how the TSA is a kind of performance art.   It gives the impression of security but little real security.  The TSA is thus to security as a Cheesecake Factory is to fine dinning; the Temple of Thebes decor not withstanding.

So I was all LOL on receipt of the rumor that a friend of one of my offspring, having graduated with a degree in theater, had gone to work at the Department of Homeland Security!  The mind boggles.  I’m hoping that we can look forward to a significant upgrade in the production values at the TSA.  Better lighting.  A thrilling sound track.  Costume design.  Now that we have Democrats in power it makes sense that we would get a good dose of arts funding into the mix.   If we accept Bruce’s diagnosis then we should demand a more artful experience, one that make us feel substantially safer than it does today.  Oh wait, what if the goal isn’t to make us feel safe?