In the face of large-scale economic shocks, enforcing debt contracts places an unbearable burden on debtors, who cut back their spending and send the entire economy into deep recession. One of the main arguments we make in our new book is that debt forgiveness makes a lot of sense when the economy experiences a large-scale negative shock that is beyond the control of any one individual.
History seems to understand this lesson well. The 48th provision of the Code of Hammurabi, written more than 3,500 years ago in Mesopotamia, states that: “If any one owe a debt for a loan, and a storm prostrates the grain, or the harvest fail, or the grain does not growth for lack of water, in that year he need not give his creditor any grain, he washes his debt-tablet in water and pays no rent for this year.” The main threat to economic activity in ancient Mesopotamia was a drought, and one of the first legal codes understood that debt should be forgiven if such a negative shock occurred.
In 1819 when agricultural prices in the United States plummeted leaving farmers overly indebted and unable to pay their mortgages, politicians ran to their defense. Many state governments immediately imposed moratoria on debt payments and foreclosures. Senator Ninian Edwards of Illinois pushed through national legislation to forgive farmers’ debt, arguing that the country should have sympathy for the farmers who, like the rest of the country, got caught up in the short-lived “artificial and fictitious prosperity.”
Jonathan Safran Foer was sitting at a Chipotle one day, when he realized that he had nothing to do while noshing on his burrito. He had neglected to bring a book or magazine, and he didn’t yet own a smartphone. “I really just wanted to die with frustration,” Foer told VF Daily.
Suddenly, the Eating Animals author (and vegetarian) had an idea: What if there were something truly good to read on his Chipotle cup? Or the bag? A few years earlier, he had met Steve Ells, Chipotle’s C.E.O., so he decided to write the executive an e-mail. “I said, ‘I bet a shitload of people go into your restaurants every day, and I bet some of them have very similar experiences, and even if they didn’t have that negative experience, they could have a positive experience if they had access to some kind of interesting text,’” Foer recalled. “And unlike McDonald’s, it’s not like they’re selling their surfaces to the highest bidder. They had nothing on their bags. So I said, ‘Wouldn’t it be cool to just put some interesting stuff on it? Get really high-quality writers of different kinds, creating texts of different kinds that you just give to your customers as a service.’”
Foer didn’t know what to expect, but Ells went all in. Starting Thursday, VF Daily can exclusively reveal, bags and cups in Chipotle’s stores will be adorned with original text by Foer, Malcolm Gladwell, Toni Morrison, George Saunders, and Vanity Fair contributing editor Michael Lewis. Foer says ,” Chipotle refrained from meddling in the editorial process for the duration of the initiative, which the burrito chain has branded Cultivating Thought. “I selected the writers, and insofar as there was any editing, I did it,” Foer said. “I tried to put together a somewhat eclectic group, in terms of styles. I wanted some that were essayistic, some fiction, some things that were funny, and somewhat thought provoking.”
“I BECOME A TRANSPARENT EYE-BALL,” Ralph Waldo Emerson wrote, in the most famous sentence of “Nature.” In an age of constant surveillance, that image has taken on a sinister new meaning. Transparent eyeballs regard us everywhere we go—from cameras perched above intersections, in building lobbies, and from our phones and laptops, which watch us as much as we watch them.
For those who worry about this oppressively bright light on our activities, the Fourth Amendment offers some shade, with its clear language against “unreasonable searches and seizures,” and its promise that Americans have the right “to be secure in their persons, houses, papers and effects.” Lately, judges and attorneys have been scrutinizing those words, seeking to establish just how much privacy they grant us. On April 29, two cases reached the Supreme Court, asking whether the Fourth Amendment limits the right of the police to seize a cellphone from a suspect. As our lives become ever more visible to the transparent eyeballs of the future (including—yikes—drones disguised as birds and insects), the Fourth Amendment will stand at the center of the controversy.
One theory is that the rise of twin technological forces—the social flood and the age of analytics—will (a) make the news more about readers; and (b) make news organizations more like each other.
Why should the death of homepages give rise to news that’s more about readers? Because homepages reflect the values of institutions, and Facebook and Twitter reflect the interest of individual readers. These digital grazers have shown again and again that they aren’t interested in hard news, but rather entertainment, self-help, awe, and outrage dressed up news. Digitally native publishers are pretty good at pumping this kind of stuff out. Hence quizzes, hence animals, hence 51 Photos That Show Women Fighting Sexism Awesomely. Even serious publishing companies know that self-help and entertainment often outperform outstanding reporting.
Second, we should expect—and have already seen—an expedited clustering effect around news tropes, and this clustering is making news organizations more like each other. This goes back to technology. The better publishers can see what audiences are reading, the more they will be inclined to quickly serve up duplicates of the most popular stuff. This is why we have not one BuzzFeed quiz (whose popularity in the pages of a 1950s magazine would have been mysterious) but rather 17,000 quizzes in a matter of weeks from BuzzFeed, Slate, and other publishers. Each quiz’s Facebook Like count, numbering in the tens of thousands, broadcasts to other publishers: I’m popular, make more of me! Even within hard news stories, we see clustering around headline tropes (“You Won’t Believe…”; “… in 1 Graph”; “X-Number Things You Y-Verb”) across many different sites that should ostensibly be serving different audiences. When you know what works, you do it again and again.
In most developed countries, the past decade has undoubtedly been the hardest time to build financial wealth since the Great Depression. Aspiring wealth builders have been hit with a cluster bomb of stagnating economic growth and wages, high unemployment, poor career advancement opportunities, soaring living costs, paltry fixed income investment returns, and increasingly volatile financial markets.
Unfortunately, my research has found that it will become even harder to build financial wealth in the next ten to fifteen years or so because the Global Financial Crisis is far from over despite the desperate efforts of institutions such as the media and government to convince the public otherwise. Rather than encouraging a sustainable economic recovery, central banks have created what I call a “Bubblecovery” or bubble-driven recovery by inflating a series of dangerous, but temporary growth-boosting bubbles around the entire world, from Canada to China to the U.S. stock market. The inevitable ending of this Bubblecovery will finish where the 2008 Crisis left off, causing living standards to plummet even further and depressing the value of common investments for a very long time.
In 1990s, we had a generally upbeat economic environment around the country and there was a sense of naive optimism around the internet. Then came the gold rush and later the malfeasance. Right now we have a country that is facing an unending economic uncertainty, especially for a large swathe of people. As a result, the Bay Area stands out and finds itself living under a microscope. There is no naive optimism; just gross entitlement and that is what’s wrong.
Our industry has boom and bust cycles that are much faster that any other industry and at the same time have unsaid but distinct barriers to entry. The internet-speed cycles lead to many more startups and more people becoming millionaires faster and at a much younger age than any other industry — even the older version of the internet industry. We also forget that the same speed which thrills, also kills. The recent retrenchment of technology stocks is a good reminder that the craziness doesn’t get to mania levels anymore.
This bubble is similar to real estate brokers offering agents 120% splits.
A few years ago, I was surprised to find out that my friend Peter Eckersley — a very privacy conscious person who is Technology Projects Director at the EFF — used Gmail. I asked him why he would willingly give Google copies of all his email. Peter pointed out that if all of your friends use Gmail, Google has your email anyway. Any time I email somebody who uses Gmail — and anytime they email me — Google has that email.
Since our conversation, I have often wondered just how much of my email Google really has. This weekend, I wrote a small program to go through all the email I have kept in my personal inbox since April 2004 (when Gmail was started) to find out.
One challenge with answering the question is that many people, like Peter, use Gmail to read, compose, and send email but they configure Gmail to send email from a non-gmail.com “From” address. To catch these, my program looks through each message’s headers that record which computers handled the message on its way to my server and to pick out messages that have traveled through google.com, gmail.com, or googlemail.com. Although I usually filter them, my personal mailbox contains emails sent through a number of mailing lists. Since these mailing lists often “hide” the true provenance of a message, I exclude all messages that are marked as coming from lists using the (usually invisible) “Precedence” header.
For entrepreneurs in America, it is the best of times, and it is the worst of times. It is “the age of the start-up,” and “American entrepreneurship is plummeting.” We are witnessing the Cambrian Explosion of apps and the mass extinction of apps. These are the glory days of risk, and we are taking fewer risks than ever. Tech valuations are soaring, and tech valuations are collapsing, and tech valuations are irrelevant. “A million users” has never been more attainable, and “a million users” has never been more meaningless. It is the spring of hope. It is the winter of despair.
The story of American entrepreneurship begins with a tale of two definitions of entrepreneur. When the press imagines the modern entrepreneur, our minds turn to tech—coders, hackers, hoodies, apps, Silicon Valley (the show), Silicon Valley (the valley). And it’s true: This sliver of entrepreneurship has grown, by all sorts of measures, for example by venture-capital funding:
But researchers studying national entrepreneurship trends aren’t caught staring at the tip of the iceberg. When they describe “declining business dynamism” (at Brookings) and steadily falling entrepreneurship (at BLS), they’re looking at the whole block of ice. And it’s melting.
We hiked along a narrow gorge full of bushes and rocks. The ground began to change as we walked, until we were walking among great rounded humps of rock as wide as houses. “I think we’re past the really big ones,” said the German. “Hey, maybe these are the really big ones,” said Laura. “Maybe just the tops of the big ones.” The moon burned silver and the stars pounded overhead, millions in the huge dark sky glimpsed between the moonlit towers of stone. I thought of the Romans marching through here, the Persian armies, Alexander the Great, Mithridates, Hittites, Christians and Muslims and Genghis Khan; pictured the great slumbering masses of history billeted among the knobby shadows and gullies, all through the silent grasses, under the sentinel stones.
Great swathes of brand relationships could become automated. Your energy bills and contracts, water, gas, car insurance, home insurance, bank, pension, life assurance, supermarket, home maintenance, transport solutions, IT and entertainment packages; all of these relationships could be managed by your beautiful personal OS.
Brands in these categories could find themselves dealing with the digital butler (unless we, the consumer, step in and press the override button), in which case marketing in these sectors could become programmatic in the truest sense.