In a NY Times piece on a bankster who got a brain tumor and then used his last few months alive to write a book telling people how to defend themselves and their money from people like him, this quote stood out:
Mr. Murray grew up in Baltimore, about the farthest thing from a crusader that you could imagine. “I was the kid you didn’t want your daughter to date,” he said. “I stole baseball cards and cheated on Spanish tests and made fun of the fat kid in the corner with glasses.”
He got a lot of second chances thanks to an affluent background and basketball prowess. He eventually landed at Goldman Sachs, long before many people looked askance at anyone who worked there.
“Our word was our bond, and good ethics was good business,” he said of his Wall Street career. “That got replaced by liar loans and ‘I hope I’m gone by the time this thing blows up.’ ”
It is still crazy to me that this is such an open secret, yet no one does anything about it. They make deals they know are going to blow up, but don’t care because they get paid now, and someone else will have to deal with it later on. That is the financial crisis in a nutshell. Yet try to deal with Wall Street and financial compensation, and the wingnuts and teahadists have a fit about the free market and socialism, all unaware that they are being fisted by the invisible hand.
In a somewhat related vein, am I the only one who gets infuriated every time I try to buy an appliance or electronic device, and they offer to sell me a two year warranty? This just makes me livid every damned time it happens. My response is always the same- “No warranty, but how about we do this? I’ll put this product back on the shelf, and you point me to one that you think will actually last a couple years without breaking, since you and your store obviously have no confidence in this POS.”
If they didn’t have confidence that it wouldn’t break, they wouldn’t be selling you the warranty. They make more money if you never use it. It’s like insurance.
You Don't Say
They misused ‘farthest.’ Shame on the NYTimes.
Since they are trying to make easy money of the extended warranty program, I think that they assume (or at least hope) that the product in question will actually last the two years.
The real question is who bears the ultimate cost if the product does fail? It seems that the operative economic model is more akin to musical chairs than anything else.
“Still being fisted by the invisible hand.”
That, folks, is for the ages. (And the subtitle rotation above.)
Maybe they earn too much. All they have to care about are the next 5 years. That’s all they need to get rich enough to never care about money again.
This has new tag written all over it…..
Mike Kay (Team Amercia)
It’s an open secret, yet you never hear about it on the august pagers and screens of majority daily news organs.
In short there’s no one to stir the pot until a critical mass of outrage is reached.
Without sharply defined pressure, Congress has to legislate in a vacuum (ie no one is watching).
Inside that vacuum, the repubs will do whatever it takes to make the Dems fail, even if damages the country, and then there are corrupt Dems within the wire (Bayh, Baucus, Landeriu, Lincoln, Conrad, even Feingold) who will vote big piles of campaign contributions over national policy. You top this off with arcane senate rules designed to impede and you have the maze of death.
that is why items that easily pass the House, never even get a vote in the senate.
Alex, some of those clowns are taking home more in bonuses in a single year than the median wage earner in Amerikka will make in two lifetimes of work.
Brian S (formerly Incertus)
Whoever is backing the warranty. So the goal is to sell enough warranties on products that won’t fail that you stay ahead of the replacement/repair costs of the ones that do, and in most cases, it’s a pretty lucrative way to make some money, because most products, even cheap ones, manage to last the length of the warranty. And if you’re getting clamped on the margins, you can always make it damn near impossible to let a consumer actually get the warranty enforced.
They’re generally a bad bet for consumers, but even though I know that, I will occasionally buy them if it’s on something that’s necessary for me to have and costly enough that I’d have a hard time replacing it in a pinch–like my laptop, for instance.
I had almost written “one or two years”, and I was thinking about Goldman Sachs who paid a million dollar in bonuses to hundreds of employees (Didn’t they award over a billion dollar in bonuses in 2009?) . But one or two million would not be enough for them, I guess. They’ve got different standards. Five million plus their regular salary sounds like the minimum.
Jeez, do you blow up at your waitress when she asks you if you’d like anything for desert, as if the meal wasn’t enough on it’s own? It’s just part of their job to ask, and they don’t hassle you if you just decline. Just say ‘no’ and it’s over.
@Brian S (formerly Incertus): Precisely. I purchased the extended no fault warranty for my laptop, even though it was a significant percentage of the cost of the computer itself, simply because the replacement cost for the thing would have been unbearable should it have failed or been damaged.
Other than computers, I don’t own any big ticket items, and the desktops I build and repair myself. I don’t have many opportunities for extended warranties, but when offered (like at Radio Shed for a $15 corded, no-frills wall phone) I decline.
@Brian S (formerly Incertus):
Again, just like insurance.
The two year warranty always sounds too much like an upper limit- sure you’ll get this for two years, but after that it will break.
How about we let them blow up, and don’t bail them out? That way the invisible hand will fist the correct party.
You’re speaking penumbrally, right?
In a somewhat related vein, am I the only one who gets infuriated every time I try to buy an appliance or electronic device, and they offer to sell me a two year warranty? This just makes me livid every damned time it happens.
My pet peeve is the mail-in rebate… in the 21st century. Hey, instead of giving me 8 copies of my receipt and a half-dozen addresses to mail and wait weeks on end, how about just selling me the damn computer for a decent price at the register without all the post-purchase hassle? I’d rather pay $800 up front than get a $1200 package with $500 worth of mail-in’s.
hee-hee. We have a new word in our vocabulary? [I had to look the word up when the guy complained about being lusted after penumbrally.]
Suck It Up!
Don’t get pissy at the salesperson/cashier. They have to ask. Sometimes these stores hire secret shoppers to make sure they follow the script. If they don’t they get dinged on their reviews.
Yes, but Matt Taibbi screwed up his math, and swears a lot, therefore none of this happened.
It appears that John has never worked retail.
Perhaps we should remedy that and get him a FINE JOB at some place. The question is where?
McDonald’s would be bad enough.
But you know, some place like Best Buy might also work.
And, of course, there is always Walmart.
This struck me as the heartwarming tale of a rich man determined to find the ultimate investment strategy before he dies. I get that I’m a hopeless cynic, but come on. The other problem with our culture is that we make heroes out of scumbags who ‘see the light’–conveniently after they’ve cheated enough saps out of their money that soul searching will not put them in any financial jeopardy. It’s sad that anyone has brain cancer, but deciding on your deathbed that maybe you shouldn’t have been such a slimeball hardly qualifies you for sainthood.
Ironic, given the nature of our host’s transformation.
Just Some Fuckhead
I usually just say “No thanks” and save the flamethrower for old people blocking the aisles.
Damn. You beat me to it. It’s just so good.
Probably needs to be on mugs and Tees, also. Too.
@Linda Featheringill: Toys ‘R’ Us should do fine.
@Pongo: This. I had the same feeling when I was reading the NYT article.
Just Some Fuckhead
A few years ago I bought an HD projector off of a camera/video internet store based in New Jersey. The salesman called me and gave me the hardest extended warranty pitch I’ve ever gotten, to the point I got pissed off and blew up the sale. He went right there with me, yelling “Fine, go buy it somewhere else! I’ll cancel it for you!” After we both calmed down, he sort of half apologized and we made the transaction without the extended warranty.
I got off the phone thinking he prolly had a pretty high conversion rate on extended warranties.
@gbear: It pisses me off when somebody tries a clumsy upsell, including the waitress pimping a piece of stale pie.
– I don’t want a fucking bottle of wine for lunch at the Olive Garden
– I usually rent cars from Dollar (and they have my profile so they don’t ask me any questions) but I just rented a car from Budget. They asked me 96 questions, trying to upgrade the car and upsell me on insurance I don’t need.
– I don’t want a warranty that only kicks in after the mfr’s one-year warranty expires
– I don’t want to switch from the hotel room I booked to a $500 a night suite
These are used-car salesman tactics. I know they work on certain suckers, but I’d love it if I never saw them again as long as I live.
Endless demands, endless complaints, endless whining, endless rushing about, and probably endless labor.
How much over minimum wage do you think they pay?
Of course, if you really, really, really need the money, you will take whatever they offer and put up with whatever the customers dish out. Until you crawl up into the tower with a rifle.
And I think we should sentence Mark to work as a waiter. Maybe the night shift in a busy place that gets a lot of after-the-bar-closes traffic.
A place that pays approximately zilch and so the tips are essential to buying groceries for tomorrow and so you cannot piss the asshole customers off.
@Suck It Up!: Well, the script should say to stop when someone says no to the extended warranty. If I say no, don’t give me this b.s. about how one of the pixels on my laptop might die. Don’t guilt me if I don’t want a bottle of wine on my lunch break. Don’t try to make me feel like a schmuck because I found a good deal on the internet and don’t want to get the whole thing f-ed up by an upgrade.
Oh, and, by far the best one – when I was renting a car in Seattle and driving up the Vancouver: “You really should take the supplemental insurance. There’s a lot of car thefts and break-ins in Canada.”
That’s not in the script, you can bet. I’m from Canada, so that’s transparent horseshit.
@Linda Featheringill: my good friend bartends at just such a place. Hammered people drop a lot of coin and rarely feel like their intelligence is being insulted. They get belligerent if their drinks aren’t strong enough or for any random reason.
And seriously, I’m not here to be part of somebody’s sales pitch. Save it for old people, housewives and suckers.
We in those categories are able to say “No, thank you” and the result is just the same.
Anyone who hasn’t seen Inside Job needs to put it at the top of their list. If it were out on DVD already I would be buying nothing else for my friends for Christmas. It’s amazing how open and shameless the banksters have been about systematically defrauding the nation for their personal enrichment.
I left the theater last night after seeing it, filled with a very specific rage at Wall Street and its bipartisan slaves on the Hill, at the Fed, at the Treasury, at SEC, and yes, in the White House.
It deserves to be twice as influential as An Inconvenient Truth ever was. Click the link to find showtimes near you.
My vote is that the fucker rots in hell unless he tells his wife and kids that the estate is all stolen and will be diverted elsewhere.
Heh. The tumor was the best part of Lee Atwater, and I was sorry to see it go.
James E. Powell
They make deals they know are going to blow up, but don’t care because they get paid now, and someone else will have to deal with it later on. That is the financial crisis in a nutshell.
That’s our political crisis in a nutshell. It’s our culture. It’s all about I, ME, MINE, and it’s all about I, ME, MINE, right now.
The Bush/Cheney Junta, and everyone who was along for the ride, operated on these principles. They can start two wars knowing they won’t have to finish them. They can blow up the economy without regard to the consequences. They can ignore, and even exacerbate, environmental problems because by the time they become a crisis, they will all be gone.
And it isn’t just the Evil-Doers in the ruling class. It’s the great mass of Americans who go along with it.
Go back and read President Carter’s 1979 speech on energy, usually called the malaise speech. He said
We know which path Americans chose, overwhelmingly. And ever since.
I checked, and it may be showing within a ten hour drive of me!
(None in Louisiana, Mississippi, Alabama)
Maybe I should wait for the DVD.
@Linda Featheringill: That’s great that you have time to sit there and turn down a bunch of upsells that you don’t need. I have no interest in standing around for half an hour while the Budget rent-a-car dude tries to sell me on seven kinds of insurance, a GPS, a full tank of gas and an upgrade to an SUV because that compact I booked is going to be too small for me.
Are you also very patient with telemarketers, or are those script-readers just too annoying?
Where would we be without The Magic Of The Marketplace?.
Homer Simpson: “extended warranty!?! How can I lose!?!”
The purchased warranty can sometimes go one’s way. Our LCD up and died on us 3 1/2 yrs into our 4-year Best Buy purchased warranty. We were broke at the time due to her finishing law school while we lived on my one income, and could not have afforded a new TV. We walked into the store with the slip, and walked out with a brand new, even better flatscreen, all for $0.
Cathie from Canada
I used to think the extended warranty was just marketing BS. But I have realized over the last few years that most appliances and electronics are so unreliable now that the extended warranty should be considered just part of the purchase price — ie, oven “on sale” for $500, plus $150 “warranty” = actual oven price $650.
The oven we bought in 2006 has just had its second replacement of the electronic panel, at the cost of $350 per panel, because I was too cheap to buy the warranty. And if you ask why I don’t just buy a new oven, of course they don’t make that “biscuit” colour anymore so replacing the oven would mean buying a new fridge, dishwasher and microwave too, and so it goes….
@Linda Featheringill: I have worked retail. I also worked in fast food. Hell, after I graduated, I built and ran a clothing store with the people who employed me (one of my three jobs) to pay for college. You aren’t talking to some privileged fool who has never had to work.
@AhabTRuler wrote several snarky things.
and I liked them a lot.
You’re on a roll.
I’ve worked retail and in the hotel industry, and I don’t spend time taking pitches from salespeople. I don’t blow up at them, mostly because I don’t want to end up as one of the assholes on “The Kitchen Table” or “Customers Suck.” Also, a lot of these people have to meet a quota with the warranty crap. I don’t let them get started, and they don’t have to quote the script; a winning situation all around.
But I feel the extended warranty shows just how far manufacturing has fallen. Time was you could buy almost anything and have it last at least five years. (My mother had a Magnavox color console for 18 years, which we got rid of only when the picture started to get fuzzy.) Now? If the fucking thing doesn’t stop working within 6 months, it’ll lock up or break irreparably within that same 2-year timeframe on the warranty. Planned obsolescence at work, all to keep people buying overpriced shit.
@AhabTRuler: Have to admit Atwater’s weasly face floated in front of me as I typed that. Still, I wouldn’t wish brain cancer on anyone–even someone as amoral as Atwater. Another deathbed epiphany from a major slimeball. Makes you wonder if brain cancer actually eats away whatever rot is interfering with the empathy, decency and morality areas in these guys’ pre-cancer brains? Could glioblastoma be the cure for psychopathy at last? Nah…More likely just the slimeball’s last con; hedge their bets in case there really is a God and try to convince the old man they have been redeemed prior to judgment day.
And here I thought the “open secret” from that NYT article was going to be the guy’s professional investment advice: heavily diversify (not just stocks and bonds, but by type of stocks and also with international stocks) and go with no/low-load funds to save on mgmt fees.
No really, that was about it, iirc
@Mark: OTOH, the only place I’ve ever had a rental car broken into was in Vancouver. They didn’t take the car, just a camera from the trunk.
When I called the cops–so I’d have a report for Hertz–and told them the car had been parked at the Skytrain station (Scott Road), they laughed at me as if any idiot would know better than that.
So I’m not so sure that the supplemental insurance wouldn’t have been a good idea for Canada. (Clearly my anecdote trumps any statistics. So there.)
@James E. Powell:
Read Nixonland. It’ll show you that, if anything, Carter’s warning was about fifteen years too late. Maybe more than that; like you say, it’s our culture. I can’t think of another nation of European lineage that has held so stubbornly to discrimination as one of its core values. Somebody, I think it was here, asked when this country became a bucket of crabs, but I think we always have been and I don’t know what will shake us out of it.
Why are you going to scream at some 20-year-old Best Buy employee who’s faithfully reading off their script because they like having a job and not sleeping at the homeless shelter?
THIS should go viral.
I have had a number of friends at Best Buy and if you work there you are only graded on your warranty and accessory percentage. The salespeople would rather you not buy if you aren’t getting the warranty.