On May 6, 2010, the Dow Jones Industrial average plunged nearly 700 points in minutes before recovering. That event was tagged a “flash crash” and was blamed on high-speed trading on the floor of American stock exchanges. High-frequency trading (HFT) for the uninitiated, is the use of electronic trading platforms for entering trading orders using computer software. Bears symbolize pessimism in the market. Flickr.com/dbarronoss
HFT is noted for its speed in initiating huge numbers of orders, sometimes even without human intervention. HFT also accounts for huge numbers of order cancellations which serves as a cause of concern in the market. Is this practice good or bad, no one can say for certain, but the perceived profits high-frequency traders make is a big burden to the market because the huge costs to other traders who are institutionalized is very high.
HFT – an arms race in speed
HFT firms used to operate in the shadows far from Wall Street. But more recently, they have been more vocal in seeking recognition, buffing their image with the Securities Exchange Commission (SEC), other institutionalized traders and the general public. As would any field where the perceived benefits are concentrated but the costs widespread, HFT traders have formed special-interest lobby groups that will champion their cause, hiring former SEC staff members and was reported by the New York Times to have spent nearly $2 million in the last few years on Washington lobbying and contributions to lawmakers. Advert
Yet, research points to the fact that total costs for the industry as a whole is beyond and above total benefits and that whatever benefits exists in the practice is favorable to HFT traders but deleterious to others. That is why regulators are desirous of curbing their activities.
On every trading day, total order involves both executed trades and cancelled orders. What would happen if 95% of total orders were reported to be cancellations? This practice is called quote stuffing, a tactic of quickly entering and withdrawing large orders in an attempt to flood the market with quotes that competitors have to process, thus causing them to lose their competitive edge in high frequency trading. Quote stuffing creates congestion in order processing, makes small time investors worse off and is skewed against investors who have invested in stock trading over the years and are ready to stick with the market in times of stress. According to Mao Ye, a professor of finance at University of Illinois, quote stuffing has made stock trading a “purely positional game,” where the only winners are those who have invested heavily in high speed computers.
HFT trading has been dubbed an opportunistic practice that banks on the weakness of the system. According to Andy Brooks, head of U.S equity trading at T. Rowe Price: “My sense is that a premise for high-frequency traders is as follows: They generate an action simply to watch our reaction. Then they position themselves to profit from that reaction.” When they are needed most, in times of stress, when the market really needs liquidity, only institutionalized investors would be around to clean up the mess. If the market were to depend on speed for trading, then the whole game would just end in high costs and economic losses for everyone.
Not only does HFT depend on computing speed, but also monopolizing resources. Where the quantity of orders in the system are beyond optimal levels, that about 95% of the orders are created just to bait other traders, you can understand the huge costs in terms of time, pricing and positioning HFT trading is placing on other investors.
On the other hand, HFT traders contend they provide high liquidity to the market and cut down transactions costs in trading by narrowing the spread in prices. Gus Sauter, chief investment officer at the Vanguard Group, says their activity serve as a “lubricant” for the stock market’s engine . But Mao Ye doubts the claims of liquidity, and Matt Schrecengost, a self-professed high frequency trader and the COO of Jump Trading, believes that SEC cannot incentivize HFT traders in a May 6-like environment because they do not ensure the workings of the market, even cannot ensure market liquidity, in such a situation.
How SEC might likely regulate HFT as a practice
Eventually, as many studies have suggested, one way or the other, high-frequency trading might be regulated, if for anything, to reduce the huge externality it is creating in the market. Either SEC might regulate it using a tax or could place timed limits on orders.
Amongst the suggestions that have been posited by SEC is to place a limit on the minimum lifetime of any quote. This is termed the minimum quote life (MQL). SEC has suggested a MQL of 50 milliseconds. Within that limit, any order placed cannot be cancelled until after the 51st millisecond. Although no one knows if this is the appropriate MQL but a limit is better than nothing in order to reduce the huge social costs of congestion on orders.
Also, a tax or fee for cancellations could also be put in place, or if not possible, a tax on investment in speed could be more appropriate. Any of these taxes would lower the total orders in the market and skew the ratio in favor of executed orders away from the present high percentage of cancellations.
Whichever of these measures is implemented, or any that might be proposed in the future, it is important that SEC creates a level playing field on Wall Street and stop other investors from gaming the system.
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Have you been accused of being individualistic, self-centered, even selfish? It didn’t bode well with you, not so? On the other end of the line, have you ever put yourself in line for others, making sacrifices for them, only to end up hurting yourself? You will not be willing to do so again. The two situations above can result in personal and inter-personal conflict. This is because as social creatures, sharing means caring, and we are expected and have been brought up to give priority to others over the self. Yet, you cannot eat your cake and have it. You cannot lose your self-interest and hope to pursue your personal goals at the same time.
Man feeling guilty, nun beside him. Credit: DG Jones/Flickr.com
In order to lead more fulfilling, happier lives, when can we, you and I, draw the line between placing the interest of others above our own self-interest?
Why is this important?
By the way, why is the above question important? If we do not satisfy our inherent prosocial desires, we are creating an environment for internal conflict. Internal conflict can result in unexplained or even excessive feelings of guilt for everyday actions. The father of economics, Adam Smith, acknowledged that while markets and commerce function because humans collectively work together, beneath the scene, the invisible hand of self-interest, or the desire to attain something for ourselves, to have a personal advantage, makes this prosocial market interaction beneficial.
Want self-interest without guilt – have it imposed
We often hear reports that the rich are getting richer and the poor poorer; that the world’s resources are in the hands of a few rich, influential men while the rest suffer abject poverty. If you are very rich, should you feel guilty about this? No matter what the argument, which the author of this piece will rather put aside, most rich persons feel guilty when faced with this statistic. So they have resorted to philanthropy and immense acts of generosity. There are numerous foundations, like the Bill and Melinda Gates foundation, that would gladly turn the tables, as well as numerous economic forums that wish to address this problem.
This altruism even in the face of selfism and greed is due to the internal conflict we face when the above questions are broached; as mentioned earlier. Psychological scientists Jonathan Berman and Deborah Small of The Wharton School of the University of Pennsylvania in a recent work, “Self-Interest Without Selfishness: The Hedonic Benefit of Imposed Self-Interest”, believe that to feel accomplished and happy even when pursuing personal advantages, it is beneficial that the desire should be “imposed” on us as individuals, and should not come from our volition. That is, people should see it as a duty, an obligation, that you pursue such a course for the benefit of yourself because it will benefit the common good.
In other words, what Bernard and Small are arguing is that if you desire the perks and advantages of life, you should allow others to confer it on you, to make you want to go for it, and not your initiating the action so that you do not lose your happiness and make yourself guilt-ridden.
Phrases like “I want it now!” will only make you guilty.
You can also make sacrifices without getting hurt.
Self-sacrifice is a virtue. If you fall into this group, you are a rare gem. No amount of money or incentive can reward you enough. But, you will agree with me that no one wants to be self-sacrificing and end up losing out. The majority of persons are averse to losses. Advert
In order to maintain that excelling quality of self-sacrifice and still minimize your losses, if you foresee any in a venture, say, you intend negotiating with some kidnappers about some victims and if the negotiations go awry, whoever gets the blame might lose so much, or, you want to undertake business ventures for a friend who is sick and are willing to feed him information about how the business is run on a daily and transparent basis, in such cases, you have to “cover your back,” to avoid disappointments and disheartenment. You cannot read the human mind and no one can foretell what time and unforeseen circumstances can cough up in the area of the imagination.
It is expected that you should be clear about the expected values and goals. Be ready to communicate well your fears. Let every party know what the risks are, the losses you foresee. Then ask: Who is going to be responsible for such losses?
Psychologists call these the “sense of agency,” that is, who is going to be responsible, who is going to be at the helm of control? Because you are undertaking these sacrifice, a “sense of ownership” is conferred on you, because you desire to be prosocial than selfish; if you retain the sense of agency for those acts, or are at the helm of control, you have no reason to complain if you are hurt, or end up with unanticipated losses.
If nobody wants to take responsibility, then whatever self-sacrificing action you intend undertaking was not valued, is not needed and is better left alone. Nobody pays money for what is not valuable; nobody is interested in controlling a valueless venture.
It is important that you throw away the sense of agency, the control and responsibility, in situations of self-sacrifice if getting hurt might make you shrink back from your sacrificial character. The essence is for you and others to benefit from your actions while you still get to be able to have your morale, your spirit, the vigor to want to carry out such an action in the future. Only a fool undertakes hurting him- or herself.
Guilt is a terrible thing if you value happiness over material wealth. I faced a similar situation recently and had to take action on it after reading this sciencedaily article. I decided to share it with you because I believe it will greatly benefit you.
Summary: wait for others to impose it on you, or make it deserving of you, if you intend pursuing your personal advantages; transfer control and leadership positions to others if an action you are undertaking is self-sacrificial in nature. Life is all about being happy and satisfied.
Prosocial is virtuous but taking care of yourself is the engine behind it all.
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It is no news that man is faced with a food crisis, especially in developing countries and Africa due to the effects of climate change. Millions go hungry and starve in countries like Sudan and Ethiopia because they do not have enough to eat. Why should it be news that a class of animals, the humble bees, are facing serious decline worldwide?
Bees. Valuable factors in food production. Credit:Alliect 27/Flickr.com
Bees, like bats, are pollinators. That means, they carry pollen from one crop to the other, thereby fertilizing plants. Plant fertilization is a factor for food production. So, the picture is that when bee population is on steep decline, plant fertilization will seriously drop and crop production will also decline. Eventually, if the matter is not tackled on time, we could be awaiting a food catastrophe the like that would drastically change world food sources and supply, and including who gets to eat and who goes hungry. Crops the bees pollinate are also needed as inputs in other industries like the clothing industry.
The mystery of the decline is solved.
The problem is manifold. First, bees are in serious decline. This situation has been referred to as “colony collapse disorder.” Male adult bees are rapidly dying off or deserting their queen, thereby weakening the chances of the survival of the colony. In addition to that, human manipulation has put the lives of these bees at risk. Pesticides have been found in wax samples, some like neonicotinoids, have been identified as posing a danger to the bees and their ability to carry out pollination. Furthermore, habitat destruction and fragmentation as a result of land development and the spread of monoculture agriculture makes the diverse natural food supply that pollinators need scarcer and more expensive. The planting of genetically modified organism (GMO) crops may also be responsible for poisoning bees and weakening their immune systems when these crops contain toxic insecticides within their genetic structure. A Nigerian agriculturist, Mr. Victor Obi, made a note that bee life cycles are being upset.
How does this translate to your income and food supplies? In euro terms, about 153 billion euros would be lost worldwide if bees cannot carry out their pollination activities.
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This represents, at 2005 estimates, 9.5% of the value of world agricultural production that humans use as food. Food that are highly at risk are fruits, vegetables, nuts, coffee and cocoa. The loss to you as a consumer, that is, what we all stand to lose if nothing is done to stem this rapid bee decline will, in euro terms, amount to between 190 and 310 billion euros in 2005 terms . Not only are widespread global agricultural catastrophe being awaited, but it would overturn and be a huge economic shock to so many economies in the world.
A laudable project you can partake in.
It is important then that this trend be well reported and monitored. It is as much of serious concern as climate change given the figures involved. That is why a lead organizer of an annual bee population counting program, “Great Sunflower Project”, Professor of Biology Gretchen LeBuhn, in a United Nations-sponsored study, is undertaking bee population counting projects in 200 locations worldwide. These projects are to serve as early warning signals that could help agriculturists and conservationists, understand the problem of declining bee populations. And the cost? Just a meager $2 million dollars.
Designed to be simple, repeatable, inexpensive and quick to detect bee population declines, compared with the potential economic losses the world faces, the estimated costs for employing international sample sites scaled to fit regional monitoring needs is little change.
You can join the Great Sunflower Project if you think you can help the world understand why bee populations are declining.
Solutions before the end comes
Counting and monitoring bee populations could be one solution to solving the problem. Another is also creating bee-friendly seed mixtures. You know, bees are specialized pollinators. That is, they are choosy about crops they pollinate. These seed mixtures aim to attract bees naturally to plants needing their assistance. Another approach would be for beekeepers to stay abreast of the news related to the industry, especially as it pertains to shipping bees to areas where they are needed for commercial pollination, staying clear of harmful pesticides and herbicides etcetera.
The rapid decline in bee population is nature’s way of telling us that environmental conditions are seriously declining. Present human breeding practices and the use of deadly toxins should be rethought. Either we will eventually learn to live with less choices in food supply if this trend is not checked, or millions of persons will not find food reaching them for survival, or both. That is why we have to join the fight against bees decline now.
You can show your support by visiting the Great Sunflower Project website now!
Do you have to be rich to live a good life? Religion and philosophy say “No.” The jury though is out when it comes to income because it depends on what one defines the good life to be. On the other hand, will living the good life make you rich? The evidence says “Yes.” But then, what is a good life and why is it important to us?
Get Happy! Credit: Olivander/Flickr.comA synonym for the good life is well-being or quality of life. Emerson defined this as “the satisfaction of an individual’s values, goals and needs through the actualization of their abilities and lifestyle.” In other words, living a life that moves smoothly; living a happy life. Dr. Jan-Emmanuel De Neve and Professor Andrew Oswald believe that youths or adolescents who are happier in life, or who have higher life satisfaction, tend to have higher levels of income, are better educated, find work faster and get promoted quicker. Both researchers found that this relationship also exists in siblings of their subjects. It was also concluded that gloomy youngsters or youths with relationship problems perform less when it comes to earning money compared to their optimistic, outgoing peers.
On the other hand, while having a high quality of life or well-being is important and close to happiness, happiness and wealth work paradoxically.
Poor or rich country, Money has a limit when it comes to attaining happiness.
Citizens of the rich and developed countries are on average happier than their counterparts from poor countries. After accounting for education, political freedom and other democratic rights, the above statement has been found to be true. Yet, it does not mean that money can buy happiness. What the findings show is that money and happiness have a positive association, but only to a point.
Robert E. Lane, a political scientist at Yale, argues that happiness is derived from two sources – material comfort (a.k.a money) and social and familial intimacy (a.k.a love). These two sources, paradoxically, are incompatible. Having more money increases your material comfort and enables you to live a more satisfying life, but it systematically weakens social and familial ties by encouraging mobility, commercializing relationships and attenuating the bonds of both the extended and the nuclear family. Citizens of poor countries have strong social ties and live daily with scarcity of money and poverty. Hence, they tend to rate money highly and even little increases in their income can result in significant reported gains in happiness.Advert Full-color flyers, brochures, sell sheets, signs and banners are all effective ways to get your name out, highlight new products and services As for those who live in economically developed and richer countries, it has been shown that there is a diminishing return in happiness when the level of wealth crosses a certain stage. This is because earning high income in these countries increases happiness but because of the strong democratic systems and social welfare programs these societies have developed over the years, at a certain point, the expected increase in happiness by earning more and more income becomes a negative – earning more income results in disillusion, social ties are threatened and more money becomes equal to less happiness and more stress.
No wonder people who value money more highly tend to be less happy than those who value love. It is not that love is not important to their lives, but when the urge and inclination for financial achievement becomes a passion and a conditioned reaction, knowing the tipping point, when to stop, becomes an elusive goal. Happiness becomes a commercialized commodity that could be attained only through the media and entertainment industry.
So, then, if Dr. Neve and Professor Oswald argue that living more satisfying lives during one’s adolescent leads to wealthier adulthood, should parents and policy makers take this notice with a pinch of salt since having much wealth will generally lead to lesser happiness for their teens come adulthood?
While money is good, happiness is more surpassing.
The desire to pursue adolescent happiness with the aim of acquiring wealth in later years depends on several factors. One is education. Another is family environment. Motivation for self-improvement and work, along with good health, are also at play. If these factors can be accounted for, it is worth pursuing because money is a good thing and material comfort makes life richer.
It should be noted too that for people with varying incomes, the impact of income on well-being is only an illusion. People with high income do not necessarily have quality time. Also, people with high income tend to be agnostic to religion where more religion is seen in happier people due to the strong social and communal bonds that religion promotes which may not relate necessarily to belief in religion itself.
People care about their “status”, or their relative financial standing with regard to others. Earning high income is a positive thing and should be encouraged. After an income shock, most persons have shown tremendous ability to adjust to the impact of that shock, which is remarkable because without this adaptive capability, there would be much unhappiness and social stress after an economic crisis.
So, income and happiness exhibit positive association. Every country wants its citizens to be happy, to live fulfilled lives, that is why they pursue policies that will enhance the quality of life and well-being of their citizens. This makes them happier. If income doesn’t buy happiness, it can buy a visit to the spa, a warm bath, achievable college degrees and many other material comforts. Our lives would be stressful and unfulfilled if we strive to attain these and are not able to.
The caveat is: at what point in your pursuit of wealth and high income are you trading your happiness for wealth? We should desire that our youths and teenagers pursue lifestyles that makes for materially comfortable adulthood, but while emphasizing moral values and societal virtues above financial pursuits, at what point in this education will we as parents and policy makers go too far? Without happiness, wealth is just a beautiful illusion.
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It’s time for some celebration. This week, I received a letter from Alltop.com that my blog, SolvingIt, has been listed on the lifestyle topic page. After visiting the page, use your browser’s find feature to search for “solvingit.” Then, add my blog to your MyAlltop page.
By the way, what is Alltop.com? This site is a blog search engine and blog/headline aggregator in one. Alltop makes it easy for you to discover reputable blogs and even new bloggers. It’s submission and blog discovery process is easy. I found Techcrunch and Lifehacker, two popular tech blogs I follow closely on Alltop and was eager to get listed. If you have a blog, you can submit your Feed URL. Due to its popularity and the faces behind the site, particularly the popular Internet Master, Guy Kawasaki, an Alltop acceptance opens a door to a large audience for any blog. I’d recommend that you do so. Also, you can create a MyAllTop Page and add my blog, SolvingIt, to your favorite feeds.
Receiving the acceptance email from Alltop on Tuesday made me very happy. I just have to share my joy with you, my faithful readers. Now, what next? Work, work and work! You would notice that recently I have been adding topics like consumer behavior to my blog subjects. AdvertWhen it comes to building your business, make sure you have all the right tools.This is because I believe that solving problems faced in the markets and in our pockets are as important as solving every other problem. I intend exploring other subjects, like creative problem solving skills, financial management skills and self-improvement and training acquisition. I love your readership and your readership spurs me on.
Every one of you, each time you visit my posts and articles, inspires me to share the knowledge, my happiness and the experiences I collate from virtual communities which are provided by persons like you. SolvingIt blog might right now be an underdog in the blogosphere, but together we will get there.
So, as I suggested, discover and share the fun of blogging by visiting Alltop today. Stop the costly searching for internet sites when you can do so on Alltop.com.
Do you think that your customers patronize you because your price is right? Have you been made to believe that giving constant coupons and discounts is a sign that your products are top quality and better than other brands? Consumers have various theories about what the market and marketing is all about. Some would tell you that when the price of a product is low, then that product is of low quality. On the other hand, some would claim that they had a poor deal when the price of a product is high while others would also claim that a high price means that product has a high quality. Advertising and marketing can influence customers for good or bad. Halcyon/Flickr.comThese are naïve theories, consumer research experts tell us, but they are the wont of the market. Because of these myriad of thoughts in the mind of your customer it is important that sellers, marketers and advertisers be careful when trying to influence the public.
If you try to influence your customers using price, your strategy would backfire based on labeling. If you tried using label and people influence, your strategy might backfire based on price or even the perception of that particular product in the market, which perception has been created by another company who must wield huge influence in the market.
Bias cues shape perception.
Hmm! That makes the work of marketers and consumers difficult, not so? It is difficult for marketers because they want you to buy the products they have on sale. It is difficult for consumers because they do not make decisions based on their thinking, but also on their budget and the perception of others.
These factors are what consumer researchers call “bias cues”, or attributes that help shape consumer perception and buying decisions. Bias cues could be price-, label- or quality-based. These cues could be correctly interpreted by the market, such as when consumers believe that low prices for a product is a signal of low quality. They could also be incorrectly interpreted by the market, such as when they believe that the high price of some orange juice with an attractive label is a signal of high quality. To make matters even more interesting, these bias cues could be meaningless at best. Have you ever wondered why companies decorate children’s shoes with shining lights? So, what theory do marketers and consumers work with? As for consumers, they have a variety of deceptive naïve theories about prices and products and can deceive any marketer who attempts to deliver a product message based on consumer perception.
Yet, some marketers have developed workable rules of practice.
Be careful when trying to influence their perception.
Some marketers have found that consumers might think a product is expensive when it is grouped with other expensive products. This is called the discrimination mentality and is evident when setting prices. Your customers might either discriminate on the price of a product when they make general inferences about that product because it is grouped amongst similar but expensive products. AdvertThese set of customers are usually ill-informed about the product quality or reputation and depend on this sort of categorization. On the other hand, some customers will ignore this categorization and concentrate on the salient features of a product even when grouped with expensive and similar products because they have a little more knowledge about the product, especially where similar brands are well known. Marketers should be careful when setting prices based on categorizations else they end up being accused of deceptive practices by customers.
It has also been found that people perceive or think a product is expensive if a relative or friend buys it cheap. On the other hand, if a stranger or someone distant to them buys it cheap, they might believe the product is cheap and maybe a good deal than if they had bought it themselves. What this means to marketers is that influencing consumers perception of your product quality and price through relatives or friends might really backfire.
The market has also found that because you have a higher knowledge about the market than consumers, you can deceive them by tweaking their perception of a product. consumers cannot be deceived twice. If a marketing gimmick can successfully make consumers think that a low-priced product is of high quality when it is not, they can learn from their mistakes when making repeat purchases. Keep that in mind when trying to influence your consumers. Decorating children shoes with colorful lights or other meaningless cues that excite emotions can give you sales today, but if you fail to meet their expectations, your marketing might eventually backfire.
As a rule: do not depend on consumer perceptions or their naïve beliefs about market prices and product quality as a guide in marketing your products.
Stop press: The worst deception is giving your customers reward that they would not need, or that are useless to them. I received one recently. After buying a popular brand of toothpaste here in Nigeria, I discovered that I was rewarded with a toothbrush which use caused pain to my gums. What humanity!
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Consumer research teaches us one lesson: to sell to the masses, create products that are uniform in character and design, but to sell to a customized clientele, to people in the know, create products that have unique experiential aspects. I breached this topic in another blog concerning the different ways novices and experts seek new knowledge and how much they are ready to cost those new knowledge. iPhone Size. Hand of the beholder. Flickr.com/The SearcherWe can go one step further: to give your customers satisfaction when designing a reward program, design the reward program with the target in mind when you aim to create a satisfying experience.
If your target is the general public, deliver reward programs that can be easily counted, that can be easily measured. On the other hand, create reward programs that are not easily counted or measurable by your clientele if you are targeting a specific subset of your customers.
In a recent study, Jingjing Ma and Neal J. Roese, of the Kellogg School of Management, Northwestern University, found that customers are often less satisfied when they receive products that are easily counted. But when they receive products that are not easily counted, they are more satisfied. When gifts or rewards are easily counted, it spurs comparison. More especially is this evident when money or cash is at stake. A customer is more satisfied if he receives a gift which cash value is above that of others, and might feel denigrated when the monetary value of his gift is below that of his peers. On the other hand, if a gift cannot be easily monetarily estimated, the customer is equally satisfied but concentrates on the intrinsic qualities of the gift.
AdvertWhen it comes to building your business, make sure you have all the right tools. Full-color flyers, brochures, sell sheets, signs and banners are all effective ways to get your name out, highlight new products and services, make big announcements and drawCustomers are humans. Humans always compare. It is a natural impulse. This is because we learn from watching others. According to social comparison theory, humans compare themselves to others in order to create uniformity, and to measure up to what is expected. Sometimes, comparing oneself to others can be a source of inspiration. When this is taken too far, it could be a self-denigrating tool, a tool for self-punishment. This is not fair but that is how we are built.
Humans compare themselves against their peers and competition.
When companies design reward programs that are easily countable, they could indirectly be asking their customers to compare their reward against that of others. Andrew was given $50 and I was given $40. Why? What if a customer thinks he was downgraded; that your reward was unfair when he has been a loyal customer? That would be bad for customer retention.
On the other hand whether customers are faced with a reward program or with the choice of picking between competing products on the store shelf, it has been found that humans as novices always compare when they are presented with different products. Only experts take a product apart; only experts have the unique ability of evaluating products on their intrinsic features, separate from comparison with other products. Experts make up a tiny fraction of the universe of customers. So, whether it be a reward program or doing shopping, humans will always compare, will make decisions slowly and carefully after every consideration has been given to their buying and will want to choose the product that is uniform to the accepted standard. Comparison creates a veneer of confidence.
What this means is that if your reward program is targeted at the general public, like say, a sweepstake, then you should not be worried about giving them rewards that can be easily monetarily estimated. You could even be using that as a competitive strategy. The options given in the program should also reflect the values you believe your customers would usually attach to the effort needed to receive such a gift. This is because the public are usually novices. They will compare notes whether you like it or note. They will compare between your present and past programs, between your programs or offerings and that of your competitors.
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On the other hand, if your reward program has as its target customer retention, customer satisfaction, or enhancing experience and increasing their happiness, it would be a mistake to present them with rewards that can be easily monetarily estimated or counted. Your customers are assumed to know a little more about your product than the average. That is why your brand is a favorite or preferred. They would be more satisfied if you present them with an experience rather than monetary value.
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2012 was yesterday. So were lots of memory garbage, disappointing refuse and related artifacts. Make it a promise to yourself that 2013 will not invite the same garbage, refuse and artifacts. Promise yourself that 2013 will be better than previous years. One way you can do this is by examining your relationships. Relationships are what make humans social creatures. Have you realized that everyone is related to everyone and to everything?
I did some web research and decided to bring you links to sites that I believe will interest you when it comes to relationships.
Because it is cheaper to retain existing clients and easier to keep them than investing in marketing for new clients, success in client retention involves building long-term relationships. Some tips that were offered include: treating customers like people, putting the goals of your clients first and going the extra mile for them. Resourcenation blog.
In 1992, after the police had beaten a black motorist, Rodney King, the city of Los Angeles broke out in rioting. The police decided to invest in community-building relationship with lots of good stories to tell. Better relationship between the police and LA community is now making the neighborhoods safer. Some community programs run by the police that is facilitating this enhanced safety are: reading to kids in school and coaching youth football teams. VOANEWS
Stop the statistic from going viral. Right now, in the U.S, join PACT in Action to reduce the alarming rate of one in three teens who will experience violence or a teen dating situation. PACT in Action was formed to train teens to pursue healthy relationships, and avoid dangerous and abusive relationships. Its goal is to educate teens so they can reach out to their peers. They believe they can reduce the current alarming statistics of teen dating abuse and violence by 10% come 2020. Courier-journal.com
When it comes to hanging out with neighbors in our communities, we are lacking, compared to online interactions on Facebook, LinkedIn etc. Nextdoor, the neighborhood social network, saw this need and attempts to fill it. It’s a social network that attempts to webify the original social network: the neighborhood. To have the Nextdoor experience, you should define your neighborhood, i.e target your territory and recruit your neighbors to sign up. Slate.com
The list is small compared to earlier ones, but the information should give you an idea of keys to success in the new year. I wish you all the best in 2013.
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On Friday, Dec. 14, 2012, the most horrific tragedy that could happen to children in American history was recorded. A gunman, name Adam Lanza, 20, who grew up in Newton, Connecticut, broke into the Sandy Hook Elementary School, Newton, Conn., and sprayed bullets on young children who were as little as 5, killing them “several times.” The end day casualty was 20 children dead, of which 12 were girls and 8 boys, and also 6 adults, including the school principal.
The news report on the Sandy Hook Elementary School Newton, Conn., shooting as it was broadcast by ABCNews channel.Emilie Parker Fund Support the Emilie Parker fund. Proceeds will go to all of the Sandy Hook Elementary School families affected in whatever ways each family deems necessary. Make a donation, else leave a caring comment. Emilie Parker Fund
The parents of Emilie Parker, 6, were among the first to make public statement about the deep loss. Robbie Parker, her father, fought back tears as he described the beautiful, blond, always-smiling girl who loved to try new things, except foods. He described her as a “bright, creative and very loving” girl.
"...as we move on from what happened here, what happened to so many people, let us not turn it into something that defines us" – Robbie Parker.
American president, Barack Obama, fights back tears as he spoke of the “broken hearts” of a nation and the families of the victims after the Newton, Conn., school shooting. He promises to provide resources, as a parent, for condoling the families, caring for the victims and counseling them.
Lauren Rousseau, 6/1982, female (full date of birth not specified)
Mary Sherlach, 2/11/56, female
Victoria Soto, 11/04/85, female
Benjamin Wheeler, 9/12/06, male
Allison N. Wyatt, 7/03/06, female
It will not be easy for the parents of our 20 dear hearts, especially for their friends who will see them no more. A child psychiatrist, Dr. Don Condle, advises that parents should look out for signs of trauma and sleeplessness as it will take time to heal the children’s emotional wounds. The children who are afraid of what happened will tend to respond with aggressive behavior. Parents should have a heart-to-heart with their children. They should reassure them of their safety. If they observe any abnormal or unusual behavior, they should immediately report to the child’s pediatrician.
Days after the killings, many persons do not understand the senselessness behind it. What happened was broadcast around the world, but not why it happened. Why a young man of 20 should first kill his mother before taking the lives of 25 others?
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The security and protection of children can be supported by donations from you. There are countless ways to do this. Credit:Official U.S Navy Imagery/Flickr.com
How can we ensure parents and social workers who provide care and ensure adequate care is given to children get the needed pat on the back? By encouraging them, both monetarily and otherwise, so that provision of care for children in need is carried out without a hitch. We all need these children; they are our future.
Here are some ways we can encourage our caregivers and care providers.
Ensuring they get needed degrees and certifications
Caregivers should get certified.
At heart, caregivers love children, but passion is not enough. By getting needed training and certification, whether as a nanny or daycare center operator, you are making sure you equip yourself with the tools and mindset for provision of sufficient care. Caregivers are usually given courses in child development, safety and first aid, child teaching, child nutrition as well child abuse recognition and reporting, which a self-training course will not. For training and schools, one useful resource is the education-portal website.
Organize state approved curriculum.
Institutions training caregivers need a well-structured and dynamic curriculum for concise and adequate training. The government should make sure it provides such to training institutions.
Establish child care rating systems, especially for daycares.
Many states rate daycare centers. One notable example is the Wisconsin Youngstar rating system. The youngstar rating system for daycare evaluates and rates day care providers on their quality of care, and supports them with tools and training for delivery of better care. This system of rating and evaluation should also be extended to caregivers in foster homes, orphanages and even in-home nurses who care for children with different forms of disabilities.
Adopt early learning standards.
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Daycare centers, foster homes and nannies or au-pairs, need to have a standard of care established for them. Standards make comparison possible and evaluation easier. It also enables social workers to understand the quality of care provided by caregivers.
Train the children to socialize, empathize and also care for one another.
It is very important that care givers take training on a regular basis so that they can improve on the quality of care they give. One skill from these trainings is to enable them understand child development and factors that stimulate a healthy development. Children need to be taught to socialize, empathize and care for other children. These can be done through training them in crafts, works of arts and going out for special events like excursions and children day parties.
While non-monetary contributions to caregiving is important, direct money contributions to improving the quality of provided care also is.
Communities should encourage opening of child care facilities.
Parks, community-run daycare centers and playgrounds are similar ways of encouraging children to develop caring qualities and be cared for. These facilities should be affordable, at least, kept at subsidized rates so that no child is left out.
Giving used clothing and toys.
There is no locality where the needy do not exist. These families always have children. Why not give out your used clothing and old toys your children do not need to the children of these families? A generous hand will always get fattened.
Community libraries and donation of books.
Nearly everyone does this nowadays, but it still has to be placed amongst one of the needed points for caregivers and care giving when children are concerned.
Encourage adoptions.
It is reported that many children in foster care need to be adopted by loving families. States should encourage families to keep these children forever in their loving homes by providing adoption tax credits as incentives so that more kindhearted loving families can embrace them. The uses of adoption tax credits is to ensure that many children as possible find families who can take them as legitimate children who need love and care, and also it helps to put those families in a more stable financial position to provide an environment where children can thrive.
Create trusts for children, especially those with special needs.
Children with special needs, who cannot care for themselves, due to mental or physical handicaps, need their future secured even to the point when the parents can run into unfortunate circumstances. It is also more important that parents provide trusts for these children since the rate of autism amongst children is on the increase. These trusts should not supplant state run care such as Medicaid and Social Security’s Security Income Program which the United States provides, but should act as supplementary financial care provision.
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Child care and child support starts from the home. Every child should have loving parents or legal guardians. There are families where there is only one parent and so, the role of child care may be taken on by members of the child’s extended family.
Caring after children at a daycare facility. Credit:Doviende/Flickr.comWhere the parents are employed and busy, caring could be provided at the home front through nannies, or outside the home using center-based care called daycare and preschools.
Whatever the choice taken by the family, the needs of the child must be paramount. The parents or legal guardians should do all within their means to make sure their children are provided with a loving and supportive environment. By law, when a child is being abused or neglected, outsiders can report the parents and the child will be taken away from them and entrusted to an orphanage, foster home or adopted. When they are very busy, some parents sometimes swap child care with other parents whom they trust.
Types of care available to children.
Every level of care, whether chosen by a parent, legal guardian or the authorities, has its pluses and weak points. Parents should realize that assessing the value of caregivers is important, even when they are employed within the home. The work of caregivers should be appreciated so the children can be best nurtured to prepare for their role as the leaders of tomorrow. Some common methods of care are outlined below:
Home based care
These are care provided to children by nannies or friends and family, and because they are based on trust, parents have to be careful. These caregivers require no licensing, neither are background checks usually done. Nevertheless, the children form a close bond with their caregiver, which is important and makes it radically different from other forms of caregiving. Exposure to illnesses is well reduced because the children are watched inside their homes and can be influenced by the caregiver. Parents have to be very careful when opting for this type of caregiving.
Daycare
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It is also called preschool when it involves primarily 3 and 4 year old children. This sort of caregiving is standardized and regulated by the authorities. Parents may employ the daycare facilities at their place of work, if one exists, or from commercial care centers. Daycare centers are regulated and licensed by the government and a license can be revoked if the center is found defaulting. Social workers who assess daycare centers often look out for signs that children are being sexually abused, whether the daycare center environment is conducive for raising up physically and mentally healthy children etcetera.
Foster care
Foster care is recommended by social workers when parents or the guardians of a child have lost the capacity to take care of the child, whether through neglect, abuse or because of other failings. These centers are state certified and sometimes funded by the government. Where they are privately operated, the foster parents are paid by the government or a social service agency. The essence is to provide care for the kids as if they were in the home of their natural parents, no matter the ethnic or cultural background of the children.
Adoption
In cases of adoption, the rights of the original parents to the child are lost when the adopting parents have satisfied every legal requirement or societal norms governing that practice. Foster care does not confer permanent change in the status of the child which adoption does. It is the act of enfolding needy children into the loving arms of kind parents; it is one of the best ways to show generosity to damaged, neglected or abused children. Adoption in the 20th century is governed by comprehensive statutes and regulations. Recently, due to the way rules have been applied when it concerns ethnicity, race and culture, neglected children are not rescued sufficiently early and placed in loving homes sufficiently quickly. There are many children needing adoption and the earlier for them the better but the above factors are real hogs in the wheel of successful adoption.
Abuse or neglect of children in family settings could require that alternative forms of care be recommended. Yet, even in state run care centers, much is left to be desired. There have been reports of starvation, humiliating physical punishment and forced labor used as disciplinary methods in state residential care facilities. Some adoptive parents are not discovered to be abusive or affiliated to terrorist organizations until after a social worker has approved them for adoption. Sometimes, the problem lies at the method of implementing the remuneration packages designed by the state itself. Whatever the problems that exist, it is encouraging when everyone puts the child’s welfare ahead of any political or social consideration. Finding a safe and peaceful home for the child is the reason why child care exists.
Parents who are faced with disabled children, or whose children face debilitating diseases, have had to depend on state help for care. These parents have to be encouraged. Providing care for such children, especially when they become technology-dependent, is a big burden on the finances of the family. Many states have provided nursing services, either in-home or outside the home, to help these families. If yours does not, ask that they do.
Empowering families, most especially vulnerable families, is important for quality care to be provided to children. Quoting the SOS USA children’s village, “every child, whether living within a family or in alternative care, has the right to experience the positive, stable and loving relationships that he or she needs for healthy personal development.”
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Children were supposed to be safely raised up in a loving family. For many children today, precariousness is the situation. Some societies have structures for protecting children; some have them only on legal paper. Whatever the situation, we can try our best to give them that security, safety and warm, enabling homes and environments.
The children are our future. Caring for them is the best investment any home can make. Credit: Save the children/Flickr.com. They are supposed to have our support and protection, our trust and love. If the above needs are at risk, their lives become destroyed, their development stunted. They become endangered, feeding the circle of addiction, poverty, violence and gangsters.
Some societies have provided child support agencies to protect and support these children when the home environment becomes insecure. They receive, investigate and respond to reports of child abuse and neglect. These societies are willing and able to give them the right to an environment that should make them flourish, develop, be educated and taken care of. Some provide for child support in cases of family neglect. These are privately-supported communal initiatives, especially where the structures of state are deficient. Whatever the case may be, our children deserve the utmost care, love, support and protection.
Situations for child support
In 2005, Phoenix Sinclair, 5, was taken from her caregivers by her mother and her mother’s boyfriend, beaten and then slain. At the time of writing, there is an ongoing public inquiry into her murder. Social workers attached to her family had written reports several times before that she was living in a “high risk” family environment. Many children, like Phoenix, are unfortunate to be living in such a family.
Government child protection agencies and sometimes, communal child support services, are required when children are found living in unstable homes. Children that require child support and protection are:
children from abusive or neglectful homes.
children living in homes with domestic violence.
children with biological deficiencies.
The Center for Disease Control and Prevention (CDC) and the Department for Children And Families in several states in the U.S, define child mistreatment as any act or series of acts of commission or omission by a parent or other caregiver that results in harm, potential for harm, or threat of harm to a child. AdvertIt is also a physical, sexual or emotional mistreatment or neglect of a child or children. Neglect is a passive form of abuse where a perpetrator is responsible to provide care for a victim who is unable to care for himself or herself, like a child, but fails to provide adequate care. Includes non-provision of sufficient supervision, nourishment or medical care, or the failure to fulfill other needs for which the victim is helpless to provide for him- or herself.
Domestic violence against children is usually classed as abuse. But where children live in homes where there is constant negativity, fights and threats to involve the children in the fights are common, then those children are also exposed to domestic violence. Social workers usually recommend that where there is a history of substance abuse in a home on the part of any of the parents, especially in single parent homes, the child should be given institutional care.
Children with iodine deficiencies, immune deficiency disorder and vitamin deficiencies might need special care that would involve a skilled nursing service at the home which program is run by the state because the high cost of sustaining their lives using technology is beyond the reach of their families. In such cases, families have had to make sacrifices. In the United States, a state-run program for technology-dependent children exists and provides in-home skilled nursing services paid for by Medicaid, a health program for families with low income.
Legal framework for supporting and protecting children
Nearly every country in the world has a legislation supporting child protection and support. This is because, according to a Canadian legislative text, “the safety, security and well-being of children and their best interests are fundamental responsibilities of society.”
In the United Kingdom, (UK), the current UK child protection system is based on the Children Act 1989 which are based on principles for child protection and support, including the paramountcy principle that states that a child’s welfare is paramount when making any decisions about a child’s upbringing.
Canada’s Child and Family Services Act 1990 makes the child the focus of care and provides for their fundamental rights and basic freedom.
In the United States, The Child Abuse Prevention and Treatment Act (CAPTA), originally enacted in 1974, provides federal funding to states in support of prevention, assessment, investigation, prosecution and treatment activities and also provides grants to public agencies and nonprofit organizations for demonstration programs and projects. This Act was amended several times and was most recently amended and reauthorized on June 25, 2003, by the Keeping Children and Families Safe Act of 2003.
As we live in an increasingly digital world, kids also need digital protection. The Children’s Online Privacy Protection Act (COPPA), 1998, makes it mandatory for companies to collection personal information on persons or entities under U.S jurisdiction from children under 13 years of age. The Federal Trade Commission (FTC) enforces COPPA and wants to prohibit websites and mobile apps that target kids under 13 from setting up tracking cookies or using GPS location tracking for marketing without parental consent. These apps make kids vulnerable.
Principle for care: Children are the future of mankind
Where children find it difficult to live with their families (or extended families), they need safe, supportive homes. Sometimes, the best thing is to place them under foster care, that is, a family or person who can accept, support and care for them as their own. Foster care services are amongst many child protection and welfare initiatives governments and caring communities have used to ensure the welfare and survival of many children and their families. While foster care is institutionalized child caring service, child adoption can also be recommended where institutional care might not be adequate. The principle is to protect children from unfit parents. This is a source of great help to parents, especially when they do not realize how unfit they are usually because of poverty, mental problems, or are passively abusing their children (aka neglect) in ignorance.
Whatever the source of protection and support, be it in the home or under foster or adoptive care, the essence is that the future of the society, of a nation and of mankind as a whole depends on children and without governmental or community support for protecting and supporting children, the future of the world will be under attack.
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Even when experts search for apples on a tree, it takes some effort. flickr.com;hikingartist.com
Learning is a lifelong process; that is why you are reading this article. It might involve learning a foreign language, a new recipe, another trade or line of business, or starting out as an entrepreneur. Learning experiences do not always have to be new. Old hands can learn new tricks. On the other hand, you can pick out a novice from an expert based on how they chose to learn.
We seek new knowledge because we want to improve, to do the same old things in better ways. That implies a selective process; the ability to pick out the useful material from the clutter. All this is done based on experience. The more experienced you are, the easier it is to pick out the relevant information from the unnecessary. This is what distinguishes novices from experts. Novices chose information that enhance their broad knowledge, while experts seek to deepen or specialize in a knowledge area.
Different prices for novices and experts.
This difference between how novices and experts chose to increase their knowledge is the reason why seeking out new knowledge involves different costs. It is just like when seeking out the news. The general news costs differently from specific niche news, especially in the academic arena. This is because when one starts out, his selective picking ability involves very little costs. A novice usually picks from generally available cheap news sources, believing that in doing so, he could stumble upon useful finds. In short, a novice does not yet face the costs of what he is seeking. That is why new general knowledge, or knowledge that covers broad aspects, usually costs lesser than new specialized knowledge.
As for an expert, he is experienced in seeking out knowledge, understands the costs of doing so and picks out the best quality news source. Furthermore, an expert does not just select anything; an expert selects new knowledge only from a chosen area and is blind to other areas.
And so were discounts and coupons born. Without these buying incentives, novices will find it costlier seeking out new knowledge and products. AdvertDiscounts and coupons make a novice stop searching, so he does not spend more for search. Experts understand the market better. Discounts and coupons do not influence their buying decisions, rather quality of information and products usually do.
Search engines exist so you do not spend more searching for quality.
Another way to filter novices from experts is in the quality of products or information they seek. Some say you can tell a man’s education if he reads the New York Times, and his financial literacy if he finds the Wall Street Journal boring. Publishers who cater to experts know that their information and products are of higher quality, and hence price these higher than mundane and general purpose products whose quality require much more advertising signals. Some sellers even sell two types of products: one for the novice, and another for the expert. I see these most often when I visit a flea market. Mass produced clothing is of different quality than customized clothing because the latter caters to the tastes of experts and fashion connoisseurs.
Let’s take a man who searches for a job that pays highly. Because of the status of the job, he spends more in searching for it and in order to be successful, he spends more in acquiring the needed knowledge to find the job. If he is averse to spending on finding a job, then he’d have to settle for one of lower status. That is what I want you to remember: if you desire information and products of high quality, it is often wise to seek the opinion of experts, else you’d be a novice playing in the field of experts and could be hoodwinked to take a low quality product for high.
There is then a high incentive to shop around because of the difference between high and low quality products and services. To solve this problem, search engines like google, amazon, yahoo and bing exist. If you go to websites like wirefly with search facilities for electronic accessories, especially mobile phones and smart phones, you’d have to possess higher knowledge than a novice. You do not necessarily have to be an expert, but you should be adept and should be able to find your way around the universe of phones.
Even when we love seeking out new knowledge, sometimes we do prefer sticking to our favorites, to the brands and news sources that we have come to trust, whether we be experts or novices. Eventually, every knowledge becomes favorite or disfavored. Keep that in mind as you go shopping.
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Imagery like this feeds folktales. If she knew a little about the cost of search, the princess would not have been deceived.
I do remember a folktale about a princess who wanted the best hand in marriage. Well, the court messenger went round the kingdom and beyond to declare the princess’ wishes for the hand of the best male suitor. So, her suitors came. They came with treasures and gold; they came with servants and entreaties – to seek her hand in marriage. One after the other, the best men in the world came for her hand. They all failed.
Eventually, when she thought none of the men was good for her, a spirit being, who listens to the happenings on earth, knowing her weakness, came for her hand. He deceived her, giving her the satisfaction she sought. How did the story end? She left with the spirit being and was never found in the world of men.
Too bad, you might say. Folktales like this exist aplenty. This story is not about looking for morals, it is a classic example of what so many persons know but never knew they did: when we seek satisfaction, if options are presented to us sequentially, that is, one after the other, we do not always have the satisfaction we seek. We always have that angst, that feeling of insecurity, that the next option will be better than the last and the last is not better than the one coming ad infinitum.
Satisfaction comes with making the correct decision or choice.
Have you gone shopping to discover that another model of that shoe you wanted was not on display? You’d think the store was underhanded, right? We all hate uncertainty. It is the reason for the existence of insurance. Most persons are ready to pay a premium to take away uncertainties. Uncertainty creates angst. On the other hand, there are situations in life where all the options for making the correct decision can never be ready at the same time, especially in times of emergency; that will be a subject for another day.
Without mincing words, if you make people take decisions without presenting them with all the options in existence, they will never be satisfied.
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That is the princess’ problem. She always thought another prince was more charming than the last. She hoped for an abstract prince who would satisfy all her dreams of what a crown prince would act and look like.
So, her uncertainty led her to make the wrong decision. She was not satisfied until the spirit being came. Satisfaction is a basic human need. When we are not satisfied, it creates a market for our wants or needs. We are ready to pay extra for satisfaction. The princess was ready to rely on hope; to wait eternally for her prince charming. Have you ever had the same situation? I have and I believe I am not the only one.
The problem of not presenting all the options for a decision rests with the existence of alternatives. If all the options were presented at once, the princess would not have fallen for the spirit being. The deceit would have been discovered. The King was not wise to have realized that. You are fortunate to be reading this blog today; make a note of this.
Search came about because someone was not satisfied.
As I said before, since her prince charming was an alternative, she was ready to think: would the next prince be better than this one? Imagine you are in her shoes. All the princes came with gifts of state; déjà vu! You would tend to think like her, that the next would have something better, and the next and the next, ad infinitum. She might not have taken a decision but for supernatural intervention. We all face that problem daily. While looking for the best prices, we comparison shop. We even spend time and resources online for search. Looking for the best chef or restaurant? We spend time going through magazines and reading reviews. Want the best travel destination? We could make use of services like Orbitz or hipmunk .
It is not easy to have all the options at once. It would be fine if that was possible. Doing so, we could make the best decision, be more satisfied and be more committed to our choices. Our world is inundated with so much options that the search for the best seems eternal. Yet, there is a cost to looking for the best. Our search ends when the cost starts getting higher than the perceived benefits. The spirit being must have realized this in the princess and that was when he made his entrée. This is the human weakness.
Now, after all, everything has a moral. So the moral of the folktale: Look for a wide variety of options presented at the same time if you want to make a satisfying, committing decision. If the King had fixed a date for all the suitors to the princess to present themselves and asked her to make a decision on that date, she surely would have made the best choice of a prince charming.
When next you are thinking of an online shopping store, whether be it amazon, zulily or zappos, keep this in mind for a satisfying, committing choice.
Happy shopping this season.
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