I don’t think anywhere is the contrast between the “old ways” and the new more apparent than the massive shift in “cost-per-pound” thinking.
When you go to the grocery store, for example, and you have two nearly-identical products and you don’t want to buy randomly. This is when those “unit pricing” figures are useful. If one item is .28 cents per ounce and the other is 0.19 cents per ounce, it’s an easy call. Or, is it? (This is how I find rotgut booze.
Back in the 50’s when Ure was coming up, there was a much broader use of “per pound purchasing.”
Take cars, for example: When my first car came along (a 1966 Ford Falcon Futura) my dad pointed out that it was actually a more expensive car than something full-sized. Fairlaines and Galaxie Ford products, for example.
A quick search of the web found the weight and price to be 2,739 pounds for $2,598. This was the “sports” edition, and being a sport, driving a car 10-pounds lighter than the more staid sedan seemed to be cool. Pappy pointed out that was just under 95-cents a pound.
For comparison, a Galaxie 500 four-door with the in-line six-banger (and three on the tree) weighed in 3,604 pounds. It went fir about $2,800 with the “Mileage Maker 6” which was the same engine we had in our ’59 Ford.
Point is (or was) that those old road hogs were considerably cheaper on a cost-per pound basis.
Of course today things are different. Light-weight is equivalent to higher tech, higher gas mileage, and so forth.
Cars are only one example.
Look at computers! Moore’s Law and all that.
Just like steel prices per pound, this is an update to “modern thinking” where the “number of transistors on a chip” is counted.
Today, although you can process a lot more on a desktop weighing about 15-pounds (with monitor) that costs $600 for a reasonable refurb (with DDR4 ram, if you’re lucky) which works out to $40 per pound.
Now, look at the specs for the latest and greatest iPhone. Amazon would be glad to sell you a new Apple iPhone X, Fully Unlocked 5.8″, 64 GB – Silver for $1,140.
Weight is so inconsequential in electronics that I couldn’t find it on the Amazon page. People just don’t buy phones based on weight, anymore… What I found said “6.14 ounces.”
Heavy-duty math now: That’s 0.3837 pounds.
I can already see the headlines in the Sunday paper ad sections:
iPhones: On Sale Today-Only for $2,971 per pound!
See how our thinking has changed? I bet you didn’t think about that before today!
Now that you have, we can move forward with a further dose of retro-think which is actually useful for contexting the world gone mad.
The Cost of Nothing Index
Going from memory here (a dangerous thing at my age) the original “Cost of Nothing Index” was compiled by Richard Buck.
You may not be familiar with him, but he co-wrote a book with Paul Merriman, one of the Northwest’s better financial advisors. Still available, too. See “Financial Fitness Forever: 5 Steps to More Money, Less Risk, and More Peace of Mind.” Have your credit card ready…
Before writing with Merriman, I believe this is the Richard Buck who – as an enterprising Seattle Times business reporter in the days before instant press releases – wrote this concept up as a column. It’s still a good idea today.
You start by looking at your bills. Then you look at any charges that accrue before you use any product at all.
I’ll give you an example: The local water company is the only bill that we don’t write an old-fashioned check for. Know why? Because a water bill is one of the few things that can place a lien on property until satisfied. I digress. Here’s what the bill looks like:
See the VFD Donation? Hopefully that will stay a “cost for nothing” but as we age, it’s yet-another casino-like bet we make every month. Life being a gamble, this is one we hope to keep losing!
Point is: Except for a one-time leak resulting in us putting in new lines on the house side of the meter (shifting land will do that) we’ve never gone over the 3,600 whatever units.
In other words, if we didn’t drink any water or flush for an entire month, this bill would unflinchingly remain $37.86.
That’s a “cost of nothing.”
This is popular with power companies, too, which seem to be attracted to something called “customer charges.” The idea that not only do you have to buy the goods, but now (in corporate hypnotized and drugged America) it is de rigueur that hapless sheep pay for the privilege of spending their money. FMTT.
Even if you have basic telephone service, and an old-style land line, you will have to pay not only the line charges, but local, state, 9-1-1 taxes and all that other stuff.
Even if you don’t make – or get – a single call.
Same thing with cable: If you have a cable bill, even if you don’t watch a single TV show, you still get billed.
It’s a racket – and a very profitable one for a lot of corporations.
People just don’t think as critically about nothing, anymore. They will sign up for stuff and not really use it.
There’s a “mental fitness” training program that Elaine wanted to use. So I signed us up…and guess what? She got too busy to use it. We bought the “family plan” – and there was a 2-day of flurry of interest. Then kaput! But since we had paid…it turned into another “cost of nothing.”
When you begin looking really hard at your personal finances. you might be able to find several ways to get out of “customer” and “basic service” charges. But, like I said, it’s become so de rigueur that you may not have any choice.
We certainly didn’t with the water supplier.
But, since we don’t hit the threshold, maybe another pot of coffee is in order.
Serious Market Time
A couple of readers wondered why I wasn’t reviewing comments most often during the day. We’ve had some great ones, by the way. Up 7 percent in the last couple of weeks. But it does take focus. A solid decline today would put us up 10 percent for two weeks.
The short answer for less review time is busy! When I’m not watching the market minutely and trading using the principles outlined on Peoplenomics, I’ve been spending a lot of time working around the house on things like the bathroom (which looks dandy now) and getting ready for next Big Projects.
Weather is starting to close-in on use in East Texas. We have four months when the devil itself would be comfortable and during that time, the shop gets sprayed down with rust inhibitor and we work on inside projects. Like retooling this website which is on the agenda. Assuming no plumbing failures…
Kind of the opposite of an Antarctic research outpost. They have a cold, we have a hot…about the same time.
I will try to be a little more diligent. But at a price: Bryce is limited to no more than 3-posts per day. And he must include punctuation, too, or its into the punctuation penalty box.
After all, we do have our standards.
Typos? Here? Well, we picked up a fresh load of them just the other day for 0.06-cents a ton. We by seconds from social media. Hope you enjoy them.
Some wise-acre suggested we close our remarks with “Rot when you get rich,” and while it may turn out that way, we’ll stick for now with…
Write when you get rich,