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Tom Au
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In the early 1990s, during the middle of a secular bull market, I began work on "A Modern Approach To Graham and Dodd Investing," that was not particularly suited for the decade of the 1990s, but was ideally suited for the following "Lost Decade" of the 2000s. In the early... More
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  • (America's) Beggars CAN Be Choosers. 1 comment
    Dec 27, 2010 2:16 PM
    Grim as things have sometimes been in the United States, it doesn't seem like we've hit rock bottom. The indicator that I am using is decidedly low-end, the beggars that occupy the streets of New York City (and many other towns).

    On Christmas Day, I encountered one of these mendicants holding up a sign: "Need 25 cents for food." Now 25-cent pieces don't buy a lot of food, unless you have a lot of them.

    Being out of change, I went to a nearby store and bought a banana for 50 cents, receiving 50 cents in change for a dollar. Then I decided to run an experiment by holding the banana in one hand and a quarter in the other, and offering the beggar a choice:  "You can have this banana, or you can have 25 cents in change." To my surprise, he opted for the quarter rather than the banana (which cost two of them).

    If he were truly hungry, the beggar would have taken the banana; immediate food, costing more than 25 cents. Apparently he wasn't, and would rather have the "choice" that the money could buy. This goes against the ancient dictum "beggars can't be choosers." In America, apparently they can, and are. (On the other hand, I was glad I got to keep the banana, being hungier than I thought.)

    A Financial Times reporter ran this experiment in 1990 (so the monetary amounts are different from today). He tried begging in both London and New York City. In London, his "home" ground, it took him ten hours to garner the equivalent of six dollars, and everyone gave him "dirty looks." In New York City, he gave up the experiment after six hours and twenty-three dollars, with no particular unpleasantness.

    The reporter's conclusion: No one would beg in London except as a last resort. On the other hand, begging could be an attractive alternative in New York City, compared to working at McDonald's for minimum wage (then $4 an hour).
     
     
     
     
     
     
     
     
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    At the intersection/ramps from Eight Mile Road (made famous by both Eminem and rampant danger and crime reports) and I-75 there sits a couple beggars.

    These (same) two gentlemen have worked this section for at least 13 years (which is the time between the first time I noticed them, and a couple months ago when I happened to drive through there at rush hour and saw they were still hanging out there.

    Back in 2000 or 2001, I was stuck in that area nearly daily as construction was causing huge backups. My car's air conditioning also sucked and I sat there for way too much time nearly everyday.

    I struck up an ongoing conversation with one of the guys. One day it occured to me that it wouldn't take much to help this guy find a real job and get a place to live. He smiled politely at my offer and chuckled to himself.

    Pointing over to a nearly new, black, shiny Cadillac, he said, "that's mine."

    Over the next few days I learned that he lived in a luxury apartment in Royal Oak, drove the big black Caddy and usually claimed over $25,000 on his income tax (just enough to cover the traceable money he spent). He estimated he made about twice what he claimed.

    For BEGGING.

    Yes G&D, in America, beggars can be choosers.

    We won't even begin to touch on the reality of the lady in line at Kroger's with a cart full of shrimp, steak, soda pop and name brand snack foods who argued with the cashier about her drink mix (bloody mary mix) being eligible for purchase with her "Bridge card" (modern Michigan food stamps).

    We have a long, long, way to go before pain forces us to change our ways. A very long way.
    30 Dec 2010, 04:20 PM Reply Like
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