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Now that Michael Phelps has achieved his Olympic quest of winning eight gold medals, a new quest begins: monetizing his Olympic success.  Tiger Woods and Michael Jordan have transformed themselves from great athletes to global sporting brands.  Phelps seeks to do the same.

Phelps’ agent, Peter Charlise, says that marketing requests have been rolling in daily, since they’ve arrived in Beijing.  According to an article from the Wall Street Journal, proposals have included boblehead dolls, paintings, car rims, tuxedos, and dog food.  Two separate people have even offered to sculpt statues of the Olympic swimmer.

Show Me the Money

For all of the silly ideas pitched, there is real money in the deal.  A decade ago, Nike was a fringe player in the golf market.  Today, after several smart and deliberate marketing moves with Tiger Woods as their figurehead, Nike is a well-respected brand in golf.  With Phelps, they can potentially do the same in swimming.

For this to work, Nike will need to pry Phelps away from Speedo, his current sponsor.  Speedo has done well on Phelp’s recent success.  They have sold tens of thousands of $25-a-piece Phelps jerseys and plan to retail the high-tech racing swimsuit he wore at $550 each.

What’s the value of eight Beijing Olympic gold medals in marketing opportunities?  Phelps’ agent, Charlies estimated, “I’d say $100 million of the course of his lifetime.”

Worth Its Weight in Gold

How much is $100 million in gold?

As of today (8/20/08), gold trades at $816 per troy ounce on the commodities market.  One hundred million dollars will buy you 122,549 troy ounces of gold, equivalent to 8,412.97 pounds or 4.2 tons of gold.  Divide that by eight Beijing gold medals, and there you have it.

If each of of Phelp’s Beijing medals were “worth its weight in gold”, they would weigh over half a ton each — that is 1,051.62 pounds of pure gold.

Posted on August 20th, 2008 by Ryan
Filed under: societal concerns, trend spotting | 3 Comments »

Earlier this week, I published a blog post detailing my economic discussions with Dr. Hickey, who is both my boss’s boss and a self-described old school hippie.  After I published my last post, Dr. Hickey’s brother, Jeff Hickey, commented on my site.  He kindly pointed out that I left myself off of the diagram and that I ought to be “staring up at Dr. Hickey”.  So, ladies and gentlemen, here is my newly updated economic diagram:

Skip These Two Paragraphs If Economics Bore You

If you remember your high school economics, the diagonal lines are the demand curves.  We read it by choosing a price (on the Y-axis), and the X-axis (or Q-axis) will tell you the corresponding demand.  The idea is simple.  The cheaper we price the product (or service, in this case), the more we can sell.  The inverse is true too.  If the price is higher, fewer people would buy it.

Economics focuses on optimization.  In this particular case, both Dr. Hickey and I can only work one full time job each.  There’s no point in pricing our services lower to sell a greater quantity.  Of course, people take pay cuts for career changes and better work environments, but that’s a completely different economic analysis.

Back to My Story

After we wade through the economic gobbledygook, there’s one thing important about the above diagram. Dr. Hickey’s price (a.k.a salary) is higher than mine.  Yes, that’s what the diagram’s one-inch gap between Ryan’s price and Dr. Hickey’s price implies.

I may poke fun at Dr. Hickey’s academic knowledge of economic theory.  But alas, at the end of the day, I stare up enviously at his real-life economic position.

Posted on August 15th, 2008 by Ryan
Filed under: church, economic theory | 4 Comments »

My boss’ boss is a successful Silicon Valley start-up technologist, a self-described old-school hippie, and an outspoken derider of the free market.  He often complains about large corporations and capitalistic pigs.  We affectionately call him Dr. Hickey.

Last week, it was the football-weekend pricing of a South Bend hotel that prompted Dr. Hickey’s oft-used “greedy corporation” tirade.  On a typical weekend, a hotel room near Notre Dame costs about $150 per night.  But on a football home game weekend, the room price jumps to $350 per night.

Dr. Hickey pounced and declared (quite happily, I might add) the wrongness of this “price gouging”.  His soap-box monologue included colorful imagery that compared these “unscrupulous prices” to the squeezing of male umm… body parts.  Our resident MBA student tried to give the standard “prices should be whatever the market will bear” line.  But Dr. Hickey would not be deterred.

Football and Economics

A while after Dr. Hickey finished his diatribe, I decided — for some reason unbeknownst to myself — to explain to him why underpricing is bad.   I conjured up a story and even went so far as to draw an economic diagram.  Here’s my story:

Suppose you managed a 1,000 room hotel near the Notre Dame campus. After some pricing analysis, you figure out that $350/night is the “right” price.  This means you’re able to sell out your 1,000 rooms, with pretty much nobody on the waiting list.

However, if you priced your hotel rooms at $150 a night, you’d be inviting a huge pain in the butt.  Your hotel would be a “good deal”, and many more football fans — let’s say 3,000 altogether — would clamor for your hotel rooms.  You can only house 1,000 of them.  You’re left with two thousand obnoxious fans on a wait list, constantly pestering you.

I presented Dr. Hickey with the obvious choice: (A) make more money and fill up your hotel or (B) make less money AND have thousands of obnoxious football fans clamoring at your door.  I thought the answer was clear.  Choose (A).  Price at $350.  Q.E.D.

But Dr. Hickey was shaking his head.  He launched into another “greedy capitalist” speech.  I sighed.  Bleeding heart liberals — even successful Silicon Valley ones — can be so hard headed about economics.  It was time to try a different approach.

The Hickey Demand Function

Now Dr. Hickey has worked in Silicon Valley for many years and currently manages a sizable chunk of the company’s employees.  For his high level of responsibility, I’m sure he commands a fairly high compensation.  So I explained it in his terms.

I modified my earlier diagram.  Instead of selling hotel rooms, we’re selling Dr. Hickey’s services as a Silicon Valley employee. Dr. Hickey can only work one full-time job at a time.  I went along the X-axis, set Q=1 full-time job, followed up the red dotted line, and discovered that his price (a.k.a. his salary) is very high.

Dr. Hickey smiled when I pointed out his very high price.  He made no comments of price gouging.  Or about unscrupulous profiteering.

“If you were willing to work for half your salary, I’d bet hundreds of companies would eagerly to hire you,” I said.

“Probably,” Dr. Hickey said, “but I wouldn’t even talk to them.”  His smile became even more smug.

Yes. Even bleeding heart liberals understand economics… at least when it comes to their paychecks.

Posted on August 11th, 2008 by Ryan
Filed under: chasing happiness, diary worthy, economic theory | 5 Comments »

When I teach Sunday school, I often encourage the children to pray. I would explain that praying is just talking to God. I tell kids that you can pray to God about anything.

Grown-ups seem to have taken this childhood message to heart, especially Rocky Twyman, a community organizer from Maryland. This community organizer has been touring the country and organizing prayer meetings at local gas stations to ask God for lower gas prices.

Twyman has recently been in San Francisco, according to the SF Chronicle. He and his fellow pray-ers gathered at a Chevron station and pleaded “God, deliver us from these high gas prices”.

Whining at God

Maybe I need to refine my “you can pray to God about anything” statement. I still think it’s okay to encourage children to pray to God about their small concerns. After all, it’s cute when a little boy loses his teddy bear and prays that he finds his precious companion. And I’ve prayed for petty concerns myself. For example, I can begrudgingly admit to praying for a touchdown during a nail-biting Cal football game.

It’s different, though, when a group of people gather to pray. It ought to have some level of severity. At church, we regularly pray for life issues: marriages, babies, baptisms, illnesses, societal concerns, and global hunger to name a few. But gathering to pray for lower gas prices? Doesn’t that seem a bit like whining at God? (Besides, did any of them drive to this prayer meeting?)

Why Higher Gas Prices are Good

High fuel prices hurt the pocket book. I feel it too. But recent price increases force us to consider the wisdom of the oil-dependent lifestyles we’ve chosen.

Americans live a lavish lifestyle built upon heavy consumption of global resources. For years, we lived in blissful ignorance of this fact. We build huge houses, drive large cars, and endure long daily commutes. But if we think about it, the 50+ mile daily commute from the suburbs and exurbs is downright absurd. Sitting in the car for hours is unhealthy and unpleasant. It’s polluting; it’s wasteful; and it’s widespread.

If fuel prices continue to stay high — which I hope it does — people are likely to move closer to work and find themselves happier. Recent happiness studies indicate that commuting is among the top daily activities that makes people less happy. It’s strange that misery won’t make people commute less.

If you’re going to pray to God, don’t waste your breath complaining to Him about fuel costs. Pray instead, “God, deliver us from our own absurd fossil-fuel-dependent lifestyle.”

Posted on August 1st, 2008 by Ryan
Filed under: Christian tradition, chasing happiness, relationships (and money), societal concerns | 3 Comments »

I have a very important question. Of all the sins in the world, which is the worst? There are so many delightful ones to choose from. Murder, adultery, thievery — those are the common Biblical ones. But why stick to one flavor? We have corporate sins (sexual harassment, corporate malfeasance), sports sins (performance enhancing um… coffee), Republican sins (increasing taxes, hugging trees), and Democratic sins (increasing carbon emissions, liking George W Bush).

In my scientific approach to finding the worst sin, I created the “evilness index”. I cataloged each of the 23,764 known sins, meticulously gathered data, and rated each sin using the undisputedly accurate methodology from US News & World Report Rankings- America’s Best Colleges. Guess which sin came out number one? That’s right… sarcasm. Believe me, I’m just as surprised as anyone else.

Sarcasm is #1

Why is sarcasm the worst sin? Part of the reason is that sarcasm is so widespread, so public, and so enjoyable to commit. It’s like alcohol, without the protective governmental regulation. We use sarcasm while driving. People under 21 regularly use sarcasm. There’s no societal taboo about sarcasm before noon. It’s unregulated, and it’s addictive.

How to be Sarcastic

Some people don’t know how to be sarcastic. God has spared them from this vice. But I wanted to let them experience it briefly, so they feel the weight of this sin, before they return to their virtuous lives. Sarcasm is a pleasurable and humorous form of lying. I just pray that they, too, don’t get addicted.

1) Pick an obvious statement (i.e. Ryan is sad when Hayley buys Tokidoki purses)

2) Formulate the opposite statement (i.e. Ryan is happy… )

3) Exaggerate (i.e. Ryan is absolutely delighted every time Hayley buys another Tokidoki purse)

Fighting the Addiction

Sarcasm is very addictive. One of my good friends, whose name I won’t mention, tried to give up sarcasm for lent one year. He went cold turkey but lasted only three days before he gave up.

The reason my friend has such a difficult time giving sarcasm is that he’s too intelligent. Stupidity is our weapon in fighting in fighting this sin. Practice stating the obvious. For example, try this famous presidential quote, “It’s no exaggeration to say the undecideds could go one way or another”.

Note that stupidity alone won’t save your soul. Hollywood has famously documented the Devil duping humans out of their soul. But do take solace in the fact that stupidity, unlike sarcasm, is not listed in the catalog of 23,764 known sins.

Posted on July 25th, 2008 by Ryan
Filed under: Christian tradition, brazen, chasing happiness, societal concerns | 5 Comments »

Union employees at the University of California (UC) campuses were on strike last week. These custodians, bus drivers, and other service employees were, of course, demanding higher pay. According to the union that organized the strike, AFSCME, wage rates for a UC Senior Custodian range from $10.47 to $13.54/hour. “Poverty Wages” is the union’s choice rhetoric to describe these salaries. Clearly, no “senior” level government employee should feel impoverished.

Unionized UC employees always make a big deal of UC executive salaries. Consider the recently hired UC President Mark Yudof. His compensation package is valued at $828,000 in the 2008-2009 year. He seems to have done pretty well with his negotiations, despite not getting the word “senior” appended to his title.

Don’t Believe Everything You’re Told

The AFSCME union’s web page is a bit heavy on Marxist ideology (i.e. clenched fists and clear nods toward “proletariats unite”). It made me suspect the quality of their facts. So, I did a bit of my own research. Looking at my results, I think that clenched fist of theirs might have been busy massaging the data.

I searched UC Berkeley custodian salaries via a convenient state salary online database. My sampling of 25 salaries ranged from $21,376.49 to $29,929.20 for base pay. The average base pay was in the mid-to-high $20k’s. After including overtime, many had annual pay above $30k.

Since I don’t really trust UC Berkeley either, I Googled “Mark Yudof Salary”. The San Francisco Chronicle corroborated the UC President’s salary: $591,084 plus perks. So it must be true. Everybody knows that newspapers always tell the truth.

Is the UC President worth 27.6 UC Custodians?

The UC President is paid 27.6 times an “average” custodian who makes $30,000 a year. Is this fair? Is it unfair? Or is it just some irrelevant number?

The left-leaning Marx-reading Berkeley sociologist will tell you that this income difference is downright unfair, and it’s indicative of societal class inequalities. Marxist ideology often views capitalism in terms of power differences. The moneyed class bourgeoisie (i.e. UC President Mark Yudof) set out to oppress the laboring class proletariats (i.e. UC custodians). In their ideal world, income distribution would be based on financial need, rather than, as they see it… power.

The money-grubbing McKinsey-consulting Berkeley MBA will tell you that this income difference is deservedly fair, and it’s indicative of the talent war. Business students often view capitalism as the battleground for talented superstars. (Nearly all MBA students feel they are destined for stardom).

They believe that top talent can give an organization a competitive advantage. Talented leaders will help the UC system better compete with the likes of Harvard. The UC schools, in their business-minded opinion, should be head-hunting top scholars and administrators without this pesky notion of “wage fairness”. Did I mention the UC system received pro bono consultation from McKinsey & Co.?

It Is What It Is

Both the Marxist and McKinsey-ite perspectives have their merits. Yudof clearly does not need a $500k+ annual salary to survive. Nor will 27.6 extraordinarily dedicated custodians launch the UC schools to the next level of prestige.

The UC system has a tough balancing act. Top universities deal in the currency of prestige. Prestigious Nobel Laureates and MacArthur Fellows aren’t cheap. But even the most prestigious schools must keep their campuses clean and services running. For that, they need to carefully manage this perception of unfairness.

Posted on July 22nd, 2008 by Ryan
Filed under: economic theory, societal concerns | 2 Comments »

I return once again to this topic of my high school friend’s Caltrain-related death, because other high school friends have left me some very interesting comments. They pointed me to this San Francisco Examiner Article, which indicates that Ellen’s death may have been accidental.

The Caltrain spokesperson, as I noted on my first two posts, stated that she “lay down on the Caltrain tracks near the San Bruno station before being struck and killed by a northbound train”. This official line was echoed by the respected mainstream media.

A group of eye-witness teenage passengers, apparently, had a different story. These teenagers, who were waiting for a train, “saw a pedestrian, who appeared to be looking downward and not paying attention, wander into the train’s path after the crossing arm had descended”. One of them screamed, “train train.” According to their account, the pedestrian panicked and fell down onto the tracks before being struck and killed by the train.

Misleading Semantics

There’s a big difference between someone who “lay down on the Caltrain tracks” and someone who “fell and was lying down” on the tracks. The official line implies a deliberate action or suicide. The eye-witness account implies a horrible accident.

It was the Caltrain engineer who reported “seeing a woman lie down on the tracks at 1:15 pm”. I’ve peered out the front of a Caltrain. They travel fast. (Although the engineer should have slowed down near a station). If the eye-witness accounts are accurate, I would imagine that the Caltrain engineer could only see Ellen lying on the ground after she fell. It would be very difficult to determine she was deliberately lying down on the tracks.

A Motive to Mislead

When I first read the press release, I assumed that Caltrain spokespeople would be an accurate and solid source of information. But when I thought about it again, they have a lot riding on this particular incident. Their train killed a 29-year-old woman. They have an economic incentive to make people believe it wasn’t their fault.

In the End

I really don’t know what happened. We gather what information we can find and stitch together the best story we create. This news has been tough on me. And this writing process has been, as Rahul called it, cathartic.

Posted on July 21st, 2008 by Ryan
Filed under: diary worthy, relationships (and money), societal concerns | 1 Comment »

Capitalism, for all of its flaws, is very good at efficient resource allocation. Money flows towards promising opportunities. It leaves overpriced and dead-end projects in its wake.

Consider the oft talked about gas prices. Demand for gas guzzling trucks and SUVs have plummeted. American car makers reacted quickly. Ford slashed its workforce and delayed the launch of its new F150 truck. General Motors closed four truck and SUV factories and put its Hummer brand up for sale. For all of the pain this may cause in Detroit, capitalism works.

Metrics, Metrics

How do business managers make these painful budget cutting decisions? Metrics. Companies have dozens of ways to measure the effectiveness of a factory or a car model. Factory utilization, units manufactured per day, sales growth, and profit margins are all useful measurements. These metrics help make sound financial decisions. Many argue that American car maker have made bad business decisions for years, but poor strategy and blurry foresight is a different issue…

“Investing” in Non-Profits

Non-profits are known for being tight on money. Any time funds are scarce, efficiency is especially important. So, would metrics help an organization like a church?

Most churches keep a few common statistics: Sunday service headcount, baptisms, and annual budget are just a few. From these numbers, we can calculate some metrics. I’ve done some calculations on for my church, Mission Bay Community Church (MBCC).

• Estimated cost for church service: $57.69/person .
• Value created per person at a recent MBCC food bank volunteer event: $6.82/hour.

Based on these two data points, my church is very inefficient.

My New Church Metric: Price Per Soul Saved

Basic finance theory states that we should fund the organization (or the project) that generates the most benefit per dollar invested. Suppose we focused on the Christian great commission: “Therefore go and make disciples of all nations, baptizing them in the name of the Father and of the Son and of the Holy Spirit” (NIV, Matthew 28:19). Then, would “baptisms per dollar” be a good metric? Is there a “price per soul saved”? If so, MBCC has a price-per-soul ratio of $188,000 (I’m aware of only one baptism and we have an annual budget of $188,000).

I know this sounds absurd, but hear me out. There must be a church somewhere, say Oklahoma, that runs on a smaller budget and baptizes more people. Perhaps they have a price-per-soul ratio of $18,800. Or maybe in Asia there’s a church with a price-per-soul ratio of $188. Is that one San Franciscan soul worth more than 10 Oklahoman souls or more than 1000 Asian souls?

I got a lot of eye-rolls and head shaking when I mentioned my price-per-soul metric. But we need to find ways, absurd or otherwise, to make sure we’re effectively and efficiently using our scarce non-profit funds.

Posted on July 10th, 2008 by Ryan
Filed under: Christian tradition, brazen, charitable, church, economic theory, societal concerns | 2 Comments »

I was shocked and jarred this past Thursday with the death of my old high school friend, who “lay down on the Caltrain tracks before being struck and killed”. I composed an ad hoc post in memory of Ellen. My blog post, it turns out, is a small part of an online dialogue about her death.

Here are a some online thoughts:

• My first post and captured my initial reaction.
• My follow-up post considered new information that indicates Ellen’s death might not be suicide as I — and nearly everyone else — concluded based on Caltrain’s official statements.
• Leslie Veen wondered about the pain that Ellen was going through, as well as the pain that she may have caused the CalTrain engineer who struck her.
• Stacey Jensen talked Asian American women suicide rates. Suicide, apparently, is the number 2 cause of death for young Asian American women.
• Commenters on SFGate have a variety of different views. Some extend sympathies for her assumed suffering. Others view her action as selfish. One even proposes a silly plan of track-side water cannons to spray away potential suicide perpetrators.

What, Really, Am I Mourning?

Except for our recent high school reunion, I have not spoken with Ellen for years. There’s no day-to-day interaction to miss. We haven’t kept in touch, so there’s no periodic “catch-up” lunch, occasional email, or even any Facebook “friend” voyeurism. I don’t, and I can’t, mourn her recent self. I only mourn my memory of her — a memory that’s just as vivid today as it was a month ago. So, what am I mourning?

Hayley thinks that I’m mourning a lost sense of security in my life. Maybe I’m feeling my own mortality or the mortality of loved ones around me. In some ways, Hayley’s correct. But I’m also saddened about losing a relationship and shared memories.

Snippets of Shared Memories

Over the years, I’ve connected with thousands of people through shared experiences. Every so often, we’d rehash an old memory. We’d laugh about Professor Cluff, who’d sweat profusely when lecturing in his 8 am class. Or we’d joke about how Jon showed up to my birthday party at a salsa club wearing sneakers, how the bouncer wouldn’t let him in, and how I had to beg the club owner on his behalf.

If we think of our life story as these snippets of memory, then my story is stored in the memory of friends, family, classmates, co-workers, and acquaintances. In a sense, I have tomes of photo albums and journal entries stored in the back of people’s minds. I keep in touch with many. But there are many more that I might encounter on occasion at a wedding, reunion, or party.

When I run across an old friend, the interaction is almost scripted. We recognize each other; we re-introduce ourselves if necessary; then I’d retell old shared experience. I would hope that they’d remember the story. It’s so satisfying when they do. They’d get that glint of recognition in there eye, smile, and say “oh yeah” and excitedly add their own details to the story.

I find these interactions so comforting. It’s like knowing that you have those baby pictures or your wedding video or that high school yearbook — even if you don’t look at them every day. It’s good to know that they’re just there.

Lost Memories

I last saw Ellen in December at our high school reunion. We recognized each other immediately. We had been classmates for years. Our shared memories were rich and vivid. Our laughter was real.

As I think about her death, I’m sad for many reasons. I wonder about the pain that she has gone through. I ponder about why so many Asian American women resort to suicide. I sympathize for the Caltrain engineer and those on the train that struck her. And, as an old friend, I’m deeply sorry for our lost shared memories. I feel like I’ve buried a little bit of my own life with her.

Posted on July 8th, 2008 by Ryan
Filed under: diary worthy, relationships (and money), societal concerns | 4 Comments »

Update: Additional eye-witness information indicates that Ellen Chiang’s death may not be suicide.  See my recent post.

Ellen Chiang, fellow San Franciscan, fellow Cal Bear, fellow Lowell nerd, “lay down on the Caltrain tracks near the San Bruno station before being struck and killed by a northbound train”. This occurred this past Tuesday, July 1, at 1:15 pm, according to a Caltrain spokesperson.

I last saw Ellen at our high school reunion, this past December. She seemed cheerful, just as I remembered her in high school and college. Back in school, Ellen was among the most dedicated and intelligent of my classmates. She was short and a bit socially awkward, but she was generous and pleasant to be around.

Sad.

I first heard about this last night in an email circulating among high school friends. The email described the cause as a “traffic accident”. I was shocked and saddened. This morning, I found this article on SFGate that pointed towards suicide as the cause. Right now I feel… disturbed? grief? upset? I don’t even know. Is “icky” an emotion?

I had high hopes for Ellen. She was always successful. I had just hoped that she’d be happy. What happened? This comment on SFGate shed some light on the situation:

“Ellen must have been in a desperate mindset to commit such an act. I worked with Ellen for several years. I didn’t know about her medical condition until later, but it was something related to her bones. She was on heavy meds the last time I saw her and was obviously in terrible pain. I guess the pain got so bad that she couldn’t live with it anymore. I choose to remember Ellen when I first met her- a bubbly, happy person full of life and glad to be alive. She literally bounced about with joy to be working and living the life she loved. You can’t know what you can be driven to do when you are in such pain, mentally and physically. I hope I will never find out. God bless Ellen and her family. They will be in my thoughts and prayers.”

Well said. God bless Ellen and her family. They will be in my thoughts and prayers.

Posted on July 3rd, 2008 by Ryan
Filed under: diary worthy | 6 Comments »