Posts Tagged ‘luxury’
“Lifestyles of the Rich and Famous”*…
… in the age in which we live: two dispatches…
First, from the realm of real estate:
Nantucket, MA, has long served as a sandy summer paradise for jet setters such as Joe Biden, Ben Stiller, Kourtney Kardashian, and former Google CEO Eric Schmidt, among others.
Take, for instance, one six-bedroom house on Red Barn Road that was listed as far back as October 2020 for $2,995,000. Four years and four price cuts later, the 3.8-acre property is now listed at $1.7 million. Even so, it is still sitting on the market after seven months.
The listing agent, John Arena of Raveis, says he has received plenty of calls about the house, which is now in foreclosure.
“People are lined up to buy it,” he insists, adding that the foreclosure has prevented him from properly showing the house.
Shelly Lockwood of the real estate advisory firm Advisors Living has a different theory on why it hasn’t sold: The very beach the house sits on is slowly eroding away.
As a result, she says, “It’s falling in the ocean.”…
“Buying in ‘Billionaires Isle’ Nantucket Is Now a Bargain: Homes Are ‘Falling Into the Ocean’“
Next, from the arena of aristocratic accessories:
Two Italian luxury giants pay just a small amount to produce handbags that retail for thousands of dollars, according to documents in a sweeping investigation of subcontractors.
Italian prosecutors in Milan investigated the LVMH subsidiary Dior’s use of third-party suppliers in recent months. Prosecutors said these companies exploited workers to pump out bags for a small fraction of their store price.
Citing documents examined by authorities, Reuters reported last month that Dior paid a supplier $57 to produce bags that retailed for about $2,780…
The relevant unit of Dior didn’t adopt “appropriate measures to check the actual working conditions or the technical capabilities of the contracting companies,” a prosecution document said, according to Reuters.
In probes through March and April, investigators found evidence that workers were sleeping in the facility so bags could be produced around the clock, Reuters reported. They also tracked electricity-consumption data, which showed work was being carried out during nights and holidays, the report said.
The subcontractors were Chinese-owned firms, prosecutors said. They said most of the workers were from China, with two living in the country illegally and another seven working without required documentation.
The probe also said safety devices on gluing and brushing machines were removed so workers could operate them faster…
The probe also extended to Giorgio Armani contractors, and the luxury company was accused of not properly overseeing its suppliers.
Armani paid contractors $99 per bag for products that sold for more than $1,900 in stores, according to documents seen by Reuters…
As Kevin Kwan observes, too often the allure of luxury is simply an escape from reality…
* Long-running television series
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As we head back to basics, we might recall that it was on this date in 2002 that a modernization of the classic Cinderella folklore, A Cinderella Story, premiered. Panned by critics, the film was a box office success, grossing $70.1 million against its $19 million budget, and inspired multiple straight-to-video films. Indeed, over the years, it has developed into a cult classic.
“If economists could manage to get themselves thought of as humble, competent people on a level with dentists, that would be splendid”*…
Economists have a name for this
There are plenty of economics terms regular people would find not only very interesting, but useful for thinking about policy. Sadly, the most commonly used econ words tend to be the ones with the vaguest meanings — “rational,” “equilibrium” and “efficient.” Instead, here are some of my suggestions:
• Endogeneity
Everyone knows that correlation doesn’t equal causation, but somehow people seem to forget. Endogeneity is a word that can help you remember. Something is endogenous when you don’t know whether it’s a cause or an effect (or both). For example, lots of people note that people who go to college tend to make more money. But how much of this is because college boosts earning power, and how much is because smarter, harder-working, better-connected people tend to go to college in the first place? It’s endogenous. The media is full of stories about how which kind of people stay married, or what diet is associated with better health. Whenever you see these stories, you should ask “What about endogeneity?”…
Noah Smith suggest four other useful concepts in “5 Economics Terms We All Should Use.”
* John Maynard Keynes
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As we get dismal, we might send fancy birthday greetings to Sir Frederick Henry Royce; he was born on this date in 1863. An engineer and car designer, he founded (with Charles Rolls and Claude Johnson) the Rolls-Royce company, which introduced the first successful luxury cars in the emerging automotive industry.
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