mfioretti: credit cards*

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  1. Does your wallet contain an airline-branded credit card? If so, your daily Starbucks visits, iTunes selections, and dining habits serve a critical role in keeping the U.S. airline industry fat and happy.

    For carriers such as American Airlines riding Citigroup Inc. plastic, or Delta on American Express Co., these programs are a cash cow, a golden goose, or any other fiscal livestock you care to conjure. Each mile fetches an airline anywhere from 1.5 cents to 2.5 cents 1 , and the big banks amass those miles by the billions, doling them out to cardholders each month.

    For the banks, people who pay annual fees for those cards to accumulate miles are the closest thing to a sure bet. These consumers typically have higher-than-average incomes and spend more on their cards, which generates merchant fees for the banks. They also tend to maintain high credit scores, which means they pay their bills on time and banks experience fewer defaults.
    https://www.bloomberg.com/news/articl...e-more-money-selling-miles-than-seats
    Voting 0
  2. countries such as Bulgaria and Romania, which have recent histories of currency instability and financial crises, also are quite heavy users of cash.

    But the real point isn’t that Germans love cash. It’s that—for the same historical reasons—they loathe debt. (Armchair anthropologists have also long noted that German word for debt—Schulden—comes from the word for guilt, Schuld.)

    Levels of consumer debt in Germany are remarkably low. German aversion to mortgage debt is part of the reason why the country has some of the lowest homeownership rates in the developed world. Just 33% of Germans said they had a credit card back in 2011. And most of those hardly ever get used. In 2013, only 18% of payments in Germany were made via cards, compared to 50% in France and 59% in the UK.

    The national preference for cash, then, seems to be the flip side of aversion to debt, which, in turn, can be interpreted as a sign of deep-seated doubt about the future. (German businesspeople are also notorious for their pessimism about the future.) And fear of the future, of course, is rooted in the past.

    In other words, the German tendency to settle up in cash undeniably reflects the fact that for much of the last century, Germany has been either on the brink of, in the midst of, or struggling to recover from, disaster.
    http://qz.com/262595/why-germans-pay-cash-for-almost-everything
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  3. This mobilization works when the system gives consumers information that they can use, and in a way that they can use it. Think about the requirement that car manufacturers publish average mile-per-gallon statistics for all new cars. We all can compare 36 mpg to 21 mpg. We all understand what that comparison means. That "targeted transparency" rule simplifies the data and presents it in a way that conveys meaningful information. Once simplified and standardized, it makes it possible for consumers to change the way the market works.

    The problem, however, is that not all data satisfies the simple requirement that they be information that consumers can use, presented in a way they can use it. "More information," as Fung and his colleagues put it, "does not always produce markets that are more efficient." Instead, "responses to information are inseparable from their interests, desires, resources, cognitive capacities, and social contexts. Owing to these and other factors, people may ignore information, or misunderstand it, or misuse it. Whether and how new information is used to further public objectives depends upon its incorporation into complex chains of comprehension, action, and response."

    To know whether a particular transparency rule works, then, we need to trace just how the information will enter these "complex chains of comprehension." We need to see what comparisons the data will enable, and whether those comparisons reveal something real. And it is this that the naked transparency movement has not done.

    If the data does not tell us anything, what is the harm in producing it? Even if it does not prove, it suggests. And if it suggests something false, then let the offended legislator rebut it. The public will weigh the truth against the charge. Enter another Brandeisean cliché: "If there be time to expose through discussion the falsehood and fallacies … the remedy to be applied is more speech, not enforced silence." This sounds right.

    But would such a remedy work? Would more speech really help to uncover the falsehoods? In answering this question, it helps to think concretely. How, actually, does this sort of dialogue proceed? Consider an example. In the waning days of the Clinton administration...

    This is the problem of attention-span. To understand something--an essay, an argument, a proof of innocence-- requires a certain amount of attention. But on many issues, the average, or even rational, amount of attention given to understand many of these correlations, and their defamatory implications, is almost always less than the amount of time required. The result is a systemic misunderstanding--at least if the story is reported in a context, or in a manner, that does not neutralize such misunderstanding. The listing and correlating of data hardly qualifies as such a context. Understanding how and why some stories will be understood, or not understood, provides the key to grasping what is wrong with the tyranny of transparency.
    http://www.newrepublic.com/article/books-and-arts/against-transparency#
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