Numbers in the News
We could talk about Bear Stearns, whose stock went from $170 to $2, but let’s not.
Student Loan Sharking.
According to the Chronicle of Higher Education, it costs the federal government $2.64 for each dollar it provides or guarantees in a college loan. Hmm.
If I kept lending you money, for whatever reason, and it was costing me $2,640 every time I lent you $1,000, I think I might just give you the money. That would save me $1,640 even if you never paid any of it back.
Why does it cost so much?
In a separate news item, the U.S. Department of Education announced that 15 banks that lend money to students have all qualified to receive a subsidized rate of 9.5% on their money.
At a time when the government is paying only 3.4% interest on a 10-year treasury bond, charging 9.5% on a student loan is usury.
Which is what banks usury do.
Stump the Times
Jeff Leeds writes about Starbucks in Monday’s NYT business section – where the writers are supposed to be highly numerate, whether or not they’re literate.
The story exposes a deep, dark mystery.
Starbucks says it sold 4.4 million CDs last year. But critics of the company’s music business say the average company-owned store sells an average of only two CDs a day. Starbucks denied that claim but refused to give Leeds the real figure.
That stymied the writer, who grumbled and plodded onward. Elsewhere in the article, he mentions that there are 6,800 company-owned stores.
It’s hard, being an investigative reporter, trying to penetrate the veil of corporate secrecy. What are you supposed to do? – divide 4.4 million by 6800 to get annual sales per store, then divide that by 365 to find out that Starbucks sells 1.77 CDs a day per store? All the long division that’s fit to print.
One more double espresso, and Leeds may be able to stay awake for an entire story.
Whacky Wiki
Elsewhere in the business section, writer Noam Cohen juggles numbers like a stage magician in an article about the real and (mostly) imaginary problems of Jimmy Wales and Wikipedia. Cohen’s bid for the Nobel in mathematics comes when he takes a complex metaphorical abstraction and reduces it to hard-nosed quantification.
The abstraction: “Until recently…Wikipedia was run more like a store-front community center than a digital age powerhouse.”
Quantifying the store-front center: “What was a nine-person operation – a top 10 Web site had a paid staff of less than 10….” Got that? Nine is less than ten.
Measuring the magnitude of the digital-age powerhouse: “… has just recently grown to a 15-person operation.”
Should have had a chart.
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“Which is what banks usury do.” Good one!
Sooooo… where’s my thousand bucks?
Comment by Lynn — March 24, 2008 @ 10:32 am
I had it here just a minute ago.
With the $1,640 I save, I’m going to buy Mallo Cups.
Comment by Al — March 24, 2008 @ 3:54 pm