Money

Retail is changing.

Target recently made $11.00 the starting hourly wage, beginning a move to $15.00 in a couple of years. Companies like that, big-box stores with small margins and brutal competition, do not willingly increase their cost of doing business without some good reasons.

What are those reasons? All of them point to one thing: profit. Target managers figure they’ll make more money by paying their people more money.

The mechanics of that aren’t really tricky to figure out, especially if you’ve been shopping at any time in the last fifty years. Grumpy and perfunctory retail workers are the norm, which leads people to:

a. notice those individuals who are awake and even mildly engaged

b. want to repeat the experience of dealing with those folks.

The countermanding imperative is the money. In the fight to the bottom of the price curve, everything suffers. When quality gets sucked down the plughole, the only thing left is the price tag.

Funny thing is that customers will never be satisfied with just a low price. Whether they recognize it or not, they want more, whether that’s service, a better shopping environment or a smile.

Not even a smile comes for free in the great retail calculation, which is a pointer as to why Target is spending the money. One wonders whether Bait & Switch is similarly savvy.

Insecurity

There will be a lot more of this to come. Excerpts from here.

In July 2005, the last time we saw unemployment this low, the savings rate was 1.9 percent of personal disposable income. Today the savings rate is 5.4 percent. Nobody is spending because today’s job quality is so low.

Counter-intuitive, no? Savings earn zero – or cost us to maintain – and yet Americans are saving at decade-high levels.

Nowhere in the job numbers assembled by the Census Bureau and the rest of Washington’s finest minds is there a category for those taking a job for less money and fewer benefits.

No. The participation rate remains at a 40 year low. 94,000,000 people of working age no longer do so.

Consumers are scared of what will happen when the Fed begins raising rates in earnest. When it tightened the first ¼ point, interest rates jumped 1 percent to 2 percent on many credit-card accounts — the last bastion of liquidity for the middle class.

Horror story. If that last statement is true, we need to make sure we’re not in that particular category. The savings rate tells us that we are doing what we can to avoid those cards and their awful rates.

Save. Find and create income. Spend less. Invest. They are the goals.

Money

Money’s at the center of too much, in my opinion. Yes, it’s a means of exchange, a store of wealth and a way of keeping score, but it’s not much more. So why do we surreptitiously equate it with worth, usefulness, value and even intelligence?

The fashion for these things comes and goes. Boom times, say, like the 1890s or the 1980s/90s beget a fetish for wealth as a measure of everything. Money, or the perception of someone who has some, replaces qualities such as integrity, character, insight, perception, knowledge, thoughtfulness and wisdom. No. A mere accumulation of cash or assets implies none of these, although such a pile might – stress, might – be a result of some or all…but the correlation is on an individual basis only. Plenty of poor people have demonstrated the above-listed personal traits, so money is not the determining factor.

I listened to a wonderful CBC podcast on George Orwell recently. Orwell, Eric Arthur Blair, was a teenage hero of mine, a man who could write with insight and clarity like few others. He hated and fought communism with a fervor beyond his strength. He reminds me of the lay intellectual from the early to mid-twentieth century. Some working men and women were readers, thinkers, talkers and people of genuine original thought. They revered books and discussion of ideas, taking comfort in the beauty of considered contemplation.

Contrast today’s shallow shiny triviality that passes for public life. In the absence of respect for higher aspirations beyond mere cash, money floats to the top as the mindless way for the mindless to categorize others. It’s the last resort grading system, the test that everyone understands.

Passbook Account

The scene is right there, pristine in my memory. At the large meeting table in the staff room, the lady from the Commonwealth Bank sat. In front of her was a strong box. To one side a pile of opened passbooks; to the other, a similar pile of closed passbooks.

Mondays were banks days, I think we called them. Every child had a passbook (I’ll search for a photo in a bit) and made a deposit every week. The lady from the bank came to us to accept the deposit and annotate it by hand.

Imagine that: the bank came to us, and was happy to take twenty cents from children as young as five.

Unfortunately, the possible leverage over our savings habits so created was not used to best effect, but some vestigial elements remain, obvs.

Henley Beach Primary School, 1968: hardly the apex of banking service you’d imagine, but it was.