April 16, 2008
What is clickbank?
Clickbank is a service site that was built for two purposes. 1) If you have a digital product (eBook, eReport, etc) and you are looking for distribution, you can put your product here and people will help you move the product. You will need to decide on the terms you will offer your affiliate marketers. Additionally, Clickbank will track the success of your product and will rank it as others look for products to promote. 2) You can come to Clickbank as an affiliate marketer and find other people's products to promote. In essence, this puts you on the other side of the equation. The terms are pay-per-sale, and NOT pay-per-click (like many of the other programs you have seen. However, the payout can be quite high ($30 - $60 per sale).
April 14, 2008
Housing is dropping fast, but stocks go UP?
So, in the end stocks went UP even after the amazing drop in housing sales in March. "The biggest drop since 1989" should be really getting people's attention. But for some reason, the strength of last quarter's earnings were more on their mind.
I can't say that this makes any sense to me. The only explanation I can come up with is that people were really expecting a big drop in earnings and so they had already priced that into the market. When companies reported earnings in-line with expectation, that was a relief and the downward pressure on prices was released.
In the end, that still feels like short-term thinking to me. I believe this housing "thing" is far from over. My favorite quote from today was "the troubles in the subprime market masked the otherwise sound fundamentals in the housing market." What a load. The troubles in the subprime market are a part of the current fundamentals. I'm not trying to overstate the subprime market, but to completely marginalize it is wrong. This is especially true if we think it is a predictor of troubles ahead in the prime market. However, I don't know of anyone predicting this problem at this point.
April 04, 2008
How the Internet makes us anonymous
Thanks for the comment on the last entry regarding Craigslist.org. Although, I have to admit I found it somewhat confusing and in contradiction to what I've read in the Craigslit policy. If this is true, just what types of commercial solicitation are permitted on the site? Additionally, I have no way to know if this comment really came from Craig Newmark (if so, please email me at tar@bigblogmonkey.com to confirm).
Just writing that last sentence made me realize just how un-trusting I sounded. Which leads me to today's topic: How the Internet makes us anonymous.
Sure, this is no big secret. The very design of the Internet allows us to connect with people in far away places without every talking or seeing each other. The entire design was put in place for this purpose, although mostly for military and national security information sharing, I believe. Then the universities started to utilize it, as they have vast amounts of information they are trying to share. And then business and the rest of us got in on the game. But along with the opportunity for large scale information dissemination came the phenomenon of anonymity.
As the Internet has gained popularity, we've seen some of the destructive power this anonymity seems to give people. Take, for example, the extreme levels of spam and hacking that are currently tracing their packetly paths around the web as I write these very sentences. I've studied the logs and no doubt there is a robot program slamming into my firewall right now (getting the appropriate "no response" I hope). People devote large amounts of time into building programs and machines with the sole purpose of destroying other people's programs and machines. I wonder, would these people be doing such malicious things if they had to stand in front of the person their actions harm? I doubt it. We all learned this as children. We'd do something stupid or harmful with our friends and then scream "RUN." Why? Two reasons: a) we didn't want to face the consequences of what we'd just done and b) we knew we would be embarrassed by the judgment of adults should they connect the behaviors with our faces. We were particularly concerned with how our parents would respond.
So here we are in the Internet age, with vast resources at our fingertips, in our houses, available 24 x 7. And many have decided that this is an opportunity to do evil deeds without needing to "RUN." Speaking sociologically, what an interesting situation. One that we have never encountered before. Are these people simply motivated by financial gain or is there some larger psychology at work here. Perhaps this is the opportunity to behave as children in a consequence-free environment?
Regardless, I'd like to think that our technology is evolving such that we will continue to have the wonderful benefits that have come from this incredible invention with the reasonable expectation that we will all behave as adults. I see signs this is coming. The increasing popularity of encryption, host site validation and identity verification are among the positive signs I see. But, today, none of these will tell me if that really was Craig Newmark who said it would be okay to post a modest amount of listings on his site ;-)
April 02, 2008
The Housing Market Crash
In my family the topic of the housing market crash gets daily attention. It all really started when I read Sell Now!: The End of the Housing Bubble by John R Talbott last September. We had lived in our house for 8 years and had become quite comfortable. We lived in one of the big US cities where the real estate market run up had been most pronounced. As a result, we felt very lucky. This was influencing our purchasing decisions as the equity in our house was making us feel wealthier than we had before the run up in prices.
That all changed the day I read Sell Now! and started to think of the housing market crash possibilities. Up to this point, the idea of prices falling a little bit had crossed our minds. But in most social circles, the consensus was that things would flatten out, but not drop. Dr Talbott changed that viewpoint for us by systematically refuting the arguments that could possibly explain the extreme run up in prices we'd seen. Additionally, he outlined very credible data from Japan showing that a very similar phenomenon had happened 15 years ago.
The graphs were startling. They literally took the breath out of me. When you looked at the raw data, it didn't look so bad. Just as the cocktail party conversations had suggested, the prices seemed to flatten out after previous run ups. However, the graphs showing real prices after adjusting for inflation were really bad. They looked like a bell curve. A steep UP and then a steep DOWN. And the implication was that we were sitting at the very top of the biggest curve in the last 100 years right then, in the 3rd quarter of 2006, poised for a dramatic ride down. Not good.
Dr Talbott brought me two new perspectives that we hadn't had previously.
1) He helped me see the equity in our house as possibly more risky than the investments we had in the stock market. This viewpoint was generally contrary to the traditional view that building equity in your house was the safest possible way to grow a nest egg for retirement.
2) He opened our eyes to the possibility of renting a house rather than owning. This was something so remote in our minds that it was never even considered. However, upon a few weeks of data collection (looking at rentals online and in person) we came to the conclusion that we could get a BETTER house by renting for the same money, while reducing any risk as the equity would be out of our house and in the bank. What a strange situation.
Based on all of the above, we cleaned the house, got a Realtor and put up the sign. We sold our house in December, 2006 after 4 weeks of open houses.
So is the housing market crash really here now? Did we make the right move? It seems there is data to suggest that it's actually starting. It began with permits falling. Permits for new construction are often seen as a leading indicator of future sales. Then the number of properties changing hands started to fall in late 2006. Prices have stayed relatively stable, which is somewhat surprising. However, there is wide speculation that people can't change prices that easily given how leveraged many people are.
In the last few weeks it's really started to hit the fan. We've seen some incredible press on the problems in the subprime lending markets. These are mortgages and other lending instruments that were granted to people with higher risk profiles. No surprise these are the first to default. My worry is that, like permits, this is another leading indicator of what's to come. My bigger worry: Dr Talbott is being proved correct.
For our family, the housing market crash is a happy ending. However, we are not too happy as we know it has the potential to hurt many people we care about as well as do serious harm to the economy at large. 
March 28, 2008
Work at home internet business
The work at home internet business opportunities that have become popular over the last few years open income potential to the average guy that would have previously been out of reach. Before the Internet, the idea of being an entrepreneur and opening your own business meant taking a serious financial risk. The daring would get second mortgages or form partnerships with their friends. More often, those that already had money could afford the risk and would make more money.
But today, just about anyone can decide they want a work at home internet business for between $0 - $100 per month. The barrier to entry is so low that we are seeing internet businesses open at record rates. This has brought with it an entirely new industry of companies who have products to help these work at home folks along.
There are many online services that provide a complete web presence for the work at home internet business owner. The more expensive versions allow you pick the template and control many of the features of your online marketplace. These include the way the products are presented and the payment options.
A major question that the work at home internet business owner needs to ask themselves is: Will I stock actual products or drop ship to my customers?
There are pros and cons to both approaches. Stocking products means you will know exactly what's in stock when you sell it. However, you will incur an additional shipping cost over drop shipping as the products actually travel an extra leg. Additionally, you need a place to store all this inventory. Finally, this is capital-intensive. Inventory costs money up front.
Drop shipping seems like the perfect approach due to the low risks. With drop shipping you carry no risk because you don't actually buy any inventory until the customer has purchased it from you. You start by securing suppliers who specialize in drop shipping. They produce a product listing including pictures, details and prices. You present this information to your customer and make the sale. After the sale, you contact the supplier and ask them to drop ship the product directly to your end customer. You never actually see the product.
The very advantage of drop shipping is also the danger. If you do not have a solid strategy for knowing the exact number of each product your suppliers have in-stock, you can inadvertently sell something you can't produce. This will create serious frustrations for customers.
There is an on-line store software package for every work at home internet business owner. If you have inventory and can maintain it in Excel, www.monstercommerce.com is a great choice ($100 per month for pro). For those looking to avoid even these modest monthly fees, there are free options. www.doba.com will give you a free store to use with their inventory. www.miserlymonkey.com is a near-free option ($5 / month) for use with their 15,000 electronics products. However, when you go with the low-end you should expect less features.
Finally, work at home internet business owners should be prepared for the important task of promotion. It is easy to be swept up in the excitement of having your own estore, but the reality is that without promotion nobody will come. There are many, many articles and forums devoted to this topic that will prove invaluable once you are past the initial set-up stages with your store.
What is clickbank?
Housing is dropping fast, but stocks go UP?
How the Internet makes us anonymous
The Housing Market Crash
Work at home internet business
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