Coyote Blog

It is useful to have an algorithm for spending your travel (hotel, air) loyalty points.  Years ago I generally saved them for big vacation trips, usually to Europe or Hawaii.  These were the most expensive trips I took and it felt good to bring their cost down.

Two things have killed this algorithm for me.  One is that most major airlines don't have squat for points availability on popular Trans-Atlantic and Hawaiian routes (British Airways, I am looking at you).  The second change was that I started to read some of the web sites focused on travel points, for example the Points Guy.

There is good information on these sites, but a lot of the detailed strategies are way to arcane and time-consuming to bother with (e.g. Take your American Express points and convert them into gift certificates denominated in Ecuadorian currency, and then apply these for double credit... etc).  But the one takeaway I have had is to think of your points like a currency with a constantly varying exchange rate to dollars, and find the opportunities to spend the points at the best exchange rates.  TPG  maintains a monthly estimate of the value of each type of reward point.  Expected value is between 1 and 2 cents a point for most.

My new algorithm is to use my points when I am getting at least 2 cents for them, and hopefully more.   Take hotel points for example.  From time to time I will find that there is some squeeze in hotel rooms in a city I want to visit and the price of most hotels have risen 50-100% for these days.  This is a great time to use your points, particularly if you are locked into the dates and can't go on a cheaper date.  The reason for this is while the price in $ goes up, the price in points does not.  There may be some hotel chains that limit availability, but Starwood for example does not.  Let me give an example.

In several weeks I am taking my wife for a nice weekend to see her friends in Manhattan.  We are locked into the dates.  But it turns out that there is some UN event and all the hotel rates have skyrocketed even higher than usual NYC hotel rates.  It was just going to be too expensive to stay in a really special hotel.  Until I thought of the St. Regis.  It is not my first choice, but it is in Starwood and with the Starwood Amex card I have a zillion points.  Turns out for a basic room the nightly rate had gone all the way to $1500 (welcome to NY).  But the points cost for the same room was the same as it ever was, 35,000.  I was effectively getting 4.3 cents each for my points.  One could argue that since this was not my first choice, I should compare it to that alternative, but even with a cheaper rate at that hotel this was still 2.6 cents of savings for each point.

For American Airlines, I try to do the same thing.  Most transcontinental flights have no points availability, or have availability at really bad exchange rates (The one exception I have found is Cathay Pacific, which takes American points and tends to have a lot of award seats).  I increasingly use my points domestically.  When rates shoot up for a particular flight, there still may not be availability but sometimes the opportunities are there.

I can think of at least two ways goods are allocated when there are no prices

• By use of force.  In modern societies, use of force is generally limited to the government so in practice this means that goods without prices will tend to flow to those with government power or who are cronies of those in power.  A great example were the special stores in the Soviet Union for party officials, but examples great and small abound today.  Here is one small one.
• By queuing or time spent searching.  The examples of this are all around us, though they frequently are not strictly of things without prices but of things that have been priced far below their market clearing price.  I think back to my days queuing in physical lines (long before Ticketmaster and the Internet) for concert tickets that were not free but were priced so far below market clearing prices that one had to wait in long lines to get them.  The gasoline lines of the 1970's and the time spent driving around looking for a gas station that had gas is another example.  A more recent example would be long hospital emergency room lines created by people who get care "free" at emergency rooms.

It was in this context that I read this article on finding parking in New York City.  Residential street parking in NYC is an extremely valuable resource for which there is no monetary charge.  So there is a lot more demand than supply.  So people spend scores of hours a year searching and queuing for spaces.

To some extent, this time cost is sort of like a money cost -- when the cost gets too high in relation to the value people assign to having a car, people give up their cars and bring supply and demand in balance.  But while people may vary in the amount they value having a car, one perverse aspect of any queuing system is that it will tend to allocate goods to the people with the lowest marginal value for their time.   The lower the marginal value one assigns to one's time and labor, the more hours one might be willing to queue and search.

This is a large reason why I have always thought price controls during emergencies - e.g. the "no price gouging during hurricanes" sorts of laws - are particularly destructive.  In the aftermath of a disaster like a hurricane there will be those who are mainly just sitting at home waiting things out, wondering how many days they will get off work and school; and there will be those who have a ton to do - roof repairers, tree cutters, etc.  Think about gasoline, where there is often a temporary supply shortfall after a hurricane.  Prices should rise to bring things in balance but laws do not allow this, so queuing results.  Who is most able to afford to sit in these queues - the person who is just sitting around waiting for things to reopen or the person who is totally bombarded with work and needs to be 23 places at once?  Do we really want roof repairers sitting 2 hours in line for gas behind three teenagers** who had nothing else to do so their parents sent them to top of the tank "just in case"?

** Growing up in Houston through several hurricanes, I have been this teenager and assigned exactly this task.

Scouting New York is coming to an end, as the proprietor appears to be moving up from film location scouting to perhaps writing and producing his own films in LA.  For which I wish him luck.  But I will miss his long posts on quirky and interesting New York City locations.  His archives are still there, and fans of NYC or urban architecture in general are encouraged to look at his past work.

But of course, he just started Scouting LA

In New York, the local hotel industry is freaking out.  Hotels, in a wearyingly familiar pattern, want the city to ban competitors using new business models (in this case companies like Airbnb).  Of course, they can't say that they are demanding government action to block competition.  So they come up with other BS.   This statement is right out of the corporate state paybook

NYC & Company, the city’s official tourism agency, issued a statement saying, “This illegal practice takes away much needed hotel tax revenue from city coffers with no consumer protections against fire- and health-code violations.” Neither city officials nor hotel organizations would estimate how much revenue hotels and the city might be losing.

The tax argument is absurd.  There is no reason that the city could not apply lodging or some sort of new tax to the rentals if that were their real concern.  The part about fire and health regulations is equally absurd.  New York apartment and building owners would be very surprised to learn that they are suddenly somehow unregulated.  Is the implication really that New York hotels are safe but New York apartments are Triangle Shirtwaist fires waiting to happen?

This is a great example of industry capture.  A true city tourism agency should be saying "It is great that this city is developing even more options for visitors.  A diversity of lodging experiences and price levels can only help spur tourism in New York.  There may be a few regulatory tweaks that are needed to accommodate this model, but we welcome this new lodging model with open arms."  Instead, though, they are acting as government paid lobbyists for existing hotel interests.

This weekend I was driving all over the NYC area when I saw that iOS6 was available.  Stupidly, without reading reviews, I updated hoping to get the new verbal turn-by-turn directions  (the old iPhone navigation app was pretty much worthless if you are alone in the car as it did not have any verbal output).

I then spent the rest of the weekend following bizarre side roads, on tiny dirt roads, or getting instructions to turn a couple of hundred yards after I had passed the intersection.  At one point I got send off the highway on a 3 mile detour through some housing tract only to eventually be put right back on the same highway I started, about 100 yards from where it had me turn off.  I am sure that it will improve in the future, but right now the new Apple nav program is a half-baked mess.  My old Android phone was better for navigation three years ago, and I am sure Google has improved it since.  If I had to drive a lot on business trips, I would be back on Android in a second.

It is never dull here in AZ.  It appears that Michael Marin, upon being convicted of arson in court yesterday, may have committed suicide right there in court.

"Burning Man" Michael Marin reportedly died after his "medical emergency" in the courtroom yesterday, which came after a jury handed down a guilty verdict in Marin's arson case.

Fox 10 had its camera on Marin's face as the verdict came in, and it sure looks like he put something in his mouth before he started having an apparent seizure and fell unconscious in the courtroom.

Video at the link if you are morbidly inclined.

I just read JD Tuccille's High Desert Barbeque, also about arson in AZ as it turns out, and enjoyed it thoroughly.  But authors like Tuccille who are writing satire have to work hard to stay more outrageous than the news here in AZ.  Seriously, a guy starts a fire in his own house, escapes from the second floor in a scuba mask and tanks, and then crunches a cyanide tablet in court as the verdict is read?  Come on, who is writing this stuff?

PS-  I may be missing the legal definition on this, but Marin was convicted of arson on an occupied structure when he was the only occupant.  I find it odd that the arsonist himself "counts" as an occupant towards this charge which, I presume, carries worse penalties than arson on an unoccupied structure.  Upping the charge this way reminds me of the NYC police asking people on the street to show them their weed and then busting them on the charge of public display of said weed.

Folks in the OWS neighborhood in NYC are fed up and want the city to kick out the protesters.  While they grow old waiting for that, I would suggest taking some individual action right out of the army psi-ops manual (actually, its also from a Sopranos episode).

1. Find some big-ass speakers
2. Find the biggest amp you can
3. Place speakers in window, point out at park.
4. Find the single most annoying recording you can, and play it at volume 11 .. over and over and over and over, day in and day out.  I might try "I'm turning Japanese" or maybe "I want a hippopotamus for Christmas."  Possibly the song they used to play over and over in FAO Schwartz stores, or "It's a small world."   Or maybe something like a Joel Osteen sermon.  It almost doesn't matter once its been repeated 12 times an hour for 3 days.

I am terrified that Obama will feel the need to bail out California.  I can't possibly think of  a worse use of my money, nor a worse precedent for the future.   Does anyone think that, in retrospect, Bill Simon's refusing to bail out New York City was the wrong decision.  NYC is not what I could call financially responsible, but they are paragons of virtue compared to what they were in the 1970's, and would have been had they not been forced to take ownership of their budget problems.

Postscript: My prediciton if Obama intervenes:  bondholders will get 10 cents on the dollar, and the SEIU will be given 55% ownership of California.

Steven Milloy, author of the indispensable Junkscience.com, points out that Harvard's Ascherio and WIllet, authors of the study on which NYC's transfat ban was based, have also identified dangers of a similar magnitude and with similar statistical significance (the latter admittedly low, but it was low for their transfat conclusions as well) of:

• Sunflower oil
• Red meat
• Dairy products
• Soft drinks

If NYC is consistent in its logic, then it must ban these other substances.  These substances showed the same level (or greater) of health risks at the same level of scientific proof by the same study authors. 

Now that the Board has deemed their dubious trans fats research
suitable for dictating public policy, New Yorkers ought to hope that
Ascherio and Willett don't press the Board to implement some of their
other published research that is similar in "quality" to their trans
fats work.

 

New Yorkers could, for example, see restaurants
banned from serving potatoes, peas, peanuts, beans, lentils, orange
juice and grapefruit juice. Ascherio-Willett reported an increase in
the risk of heart disease among consumers of these foods in the Annals of Internal Medicine
(June 2001). Although none of those slight correlations were
statistically meaningful -- and, in all probability, were simply
meaningless chance occurrences -- a similar shortcoming didn't seem to
matter to the Board when it came to their trans fats research.

Five years ago today, I was in Manhattan on a business trip with my wife.  I almost never take my wife on business trips, but we had been living in Seattle for several years, and my wife, who had lived in NYC for years, wanted to go back and visit.

About 7:30 AM, I went down to breakfast in the W Hotel, where I was staying.  I was working at the time for an aviation startup, and in one of the great moments of bad timing, I was in New York that day to make presentations to investors, the theme of which was that commercial aviation was in the midst of a recovery, and the time was right to invest in a commercial aviation venture. 

Part way into breakfast, my wife came down to find me, and tell us we needed to see what was on TV.  We went up to one of my investor's rooms.  He had a terraced penthouse (its good to be the king) from which we watched the disaster unfold, with CNN on in the background.

The next 24 hours were among the weirdest of my life.  For a while, we actually tried to hold our scheduled meetings, but a number of attendees had friends and family who worked in the WTC, and we called it off.  I wandered the streets of Manhattan, where bizarre rumors were flying at every street corner.  People ducked in fear every time an airplane rushed over, by this time all air force fighter planes.  By noon, dust-covered people walking up from downtown got to our area, and streamed past for the rest of the day.  Strangely, I actually ran into a friend of mine who had the last Hertz rent-a-car in the city, and we made plans to drive out of the city the next day.

Phone and cell service were spotty, but we eventually got through to the person taking care of our kids back in Seattle as well as our parents.  I had not told my mom we were in NYC, so she began our call by saying "I'm so glad all my kids are no where near NY" and I had to tell her, "Uhh, mom..."

That night was like a scene out of some Charlton Heston post-apocalypse movie.  Police were only letting cars out of the island, not back onto it, so by nightfall the city was empty and dead quiet.  We finally found a restaurant in Times Square open, and the Square was empty.  There was maybe one car driving through every few minutes.  A few roller bladers where skating around Times Square, just because they could.

The next day we played find the exit from Manhattan.  We knew from various reports that there was at least one bridge off the island open, but from either confusion or misplaced security concerns, no one seemed to know which bridge.  We began to circumnavigate Manhattan, looking for an exit.  Finally, a police officer told us the only way out was to drive all the way north through Harlem on the surface streets and get on what I think was the GW bridge.  Anyway, that is what we did (finding out in the process that Harlem was not the hell-hole that gets portrayed in movies, at least the part we saw).  I have never, ever been so happy to get to New Jersey.  I wanted to kiss the ground.  Of course, we still had a short drive to Seattle ahead of us, but that was anti-climactic.

It was only later I began learning how many people I knew died in those buildings that day.  I guess I should have thought about it, given the schools I attended.  The death toll for Harvard Business School graduates alone was staggering.  Five years later, watching the retrospectives, nothing about that day seems any less horrible.  Time, at least for me, has not softened the magnitude of this disaster. 

The only silver lining I can come up with is that we have gone five years without a major terrorist attack on this country, though other's have been attacked.  Walking around on September 12, we were all sure that this was just the front-end of a wave of massive attacks.  So far, whether through luck or skill, we have avoided this fate. 

One thing I will say is that we always prepare for the last attack.  We have spent a lot of time making sure no terrorists can take over a plane with toenail clippers and fly it into another building.   But that kind of attack was obsolete 20 minutes after the second plane hit the WTC -- It didn't even work on United 93.

Frequent readers will now that I have long warned of government-funded health care acting as a Trojan horse for micro-management of our personal lives, the logic being that if our lifestyles or behaviors make us less healthy, then the government that funds medical care may claim an interest in regulating those behaviors.  I often post examples of this phenomena, the most recent of which is here.

This installment comes via Reason, and looks at the NYC Health Commissioner Thomas Friedan's new fascism to prevent diabetes program.  I am not sure I even need to comment on the following for you to get the picture:

New York City is at the forefront of this new public health movement. In
January, city health officials began
requiring
that medical testing labs report the results of blood sugar tests for all
the city's diabetics directly to the health department. This is first time
that any government has begun tracking people who have a chronic disease.
The New York City Department of Health will analyze the data to identify
those patients who are not adequately controlling their diabetes. They will
then receive letters or phone calls urging them to be more vigilant about
their medications, have more frequent checkups, or change their diet....

So what could be wrong with merely monitoring and reminding people to take
better care of themselves?  New York City Health Commissioner Thomas Friedan
has made it clear that it won't necessarily end there. If nagging is not
sufficient to reduce the health consequences of the disease, other steps
will be taken. Friedan
argues
that "modifications of the physical environment to promote physical
activity, or of the food environment to address obesity, are essential for
chronic disease prevention and control." Friedan envisions regulations for
chronic disease control including "local requirements on food pricing,
advertising, content, and labeling; regulations to facilitate physical
activity, including point-of-service reminders at elevators and safe,
accessible stairwells; tobacco and alcohol taxation and advertising and
sales restrictions; and regulations to ensure a minimal level of clinical
preventive services."

The NYC health department starred in a previous post for their brave attack on restaurants that give patrons too much for their money.

I was reading the NY Times' International Herald Tribune today here in Paris, and saw something funny at the end of an article about the crazy process underway to select the 2012 Olympic venue.  By the way, this is the big issue in Paris right now - you can't walk anywhere without finding yourself in the middle of some sort of Paris promotional event, presumably being simulcast back to the selection committee in Singapore.

Anyway, the IHT had this funny line:

The last days of the race drew the president of France, the prime minister of Russia and the queen of Spain here.  New York City pulled Senator Hillary Rodham Clinton away from a busy schedule to lend her star power.

Uhh, you mean the president of France and the prime minister of Russia don't have busy schedules?  And wouldn't a more correct formulation be "while other cities were represented by their head of state, NY City could only muster a junior member of Congress"?  I hope any city but New York wins, because, given past history, NYC will likely get themselves into some financial hole hosting the Olympics that the rest of the country will have to bail them out of.

By the way, apparently in a bid to head off past corruption, the International Olympic Committee has banned its members from actually visiting host cities and their facilities ahead of the selection.  This seems kind of extreme - you have to pick between cities but you can't learn anything useful about them.  Its depressing that the members of the Olympic committee are so untrustworthy that the only way to prevent them from collecting bribes from potential host countries is to not allow them anywhere near the country.

Politicians seem to love the movie business, or so I infer from the rash of proposals of late to subsidize the movie business. 

New York City seems to have been first out of the blocks, with this program to provide tax rebates and free advertising for shooting movies in NYC.  The article tells us this is the only industry being so targeted at this point by NY.  Why?  Why are movie jobs and movie makers somehow better than every other kind?  Maybe its because they think the movies provide good advertising for NYC, like the great light they cast on the city in movies like this and this.

Anyway, the trend got my attention when our own Arizona governor lamented that Arizona is no longer home to as many movie shoots as it once was decades ago.  Far be it for me to suggest that this is probably more of an issue of westerns going in and out of style (since about a majority of movies shot in Arizona were westerns).  Nevertheless, Napolitano is pushing ahead with her plan to improve the net income line of Hollywood studios by subsidizing production in Arizona.

Finally, via Reason, we see that Hollywood is worried that it is being left out of the subsidy competition, by actually paying companies to film in LA:

Mayor James K. Hahn on Thursday announced a plan he hopes will keep Hollywood in
Hollywood "” by paying film production companies to shoot in Los Angeles.

Hahn's proposal, which was inspired by a program that New York City
adopted in December, would use as much as $15 million in public funds to
reimburse companies that make a movie in Los Angeles, paying them 5% of their
production costs or up to $625,000.

OK, so one would think that all these locations have struggling media and production industries.  But in fact, just the opposite is true.  In New York:

But Wylde thinks film is just the tip of the iceberg. The city's entire media sector is growing explosively, she notes. From Time Warner to Hearst to Bloomberg LLP, media firms account for $13 billion in city wages, 50% more than tourism.

And, in LA:

Last year, however, film, video and television production in Los Angeles
actually reached record highs. Entertainment Industry Development Corp. issued
permits for 52,707 location production days "” one day representing a single day
of work on a single project "” a 19% increase over 2003.

Doesn't sound like they are in much trouble.  Their film and media businesses are already growing explosively to record highs.  So why do they need a subsidy?  Doesn't exactly sound like the New England textile business.

Look, at the end of the day, this is about politicians handing taxpayer money to powerful media people, people who have the ability to disproportionately influence public opinions and things like ... elections!  This is a barely disguised campaign expenditure, except for the fact that taxpayers pay the bill.

I wrote more about the idiocy of subsidizing corporate relocations to one's state or city here.

Update:  Match Welch has more