Gift Giving

Buying the right gift.

I stumbled upon an article in Slate Magazine titled “The Sovereign vs. the Idiot: What kind of gift-giver are you?” by Joel Waldfogel. Its lead paragraph includes the following factoid:

Most of the time, people choose purchases for themselves and only buy things that they expect to value at or above the price they pay. With gifts, by contrast, recipients end up with items that givers guess that the recipients might appreciate.

The result of all this, according to the article, is that we often pay more than we should for items that may or may not be appreciated by the recipients. In other words, we don’t get as much satisfaction for our money. The article, which is about the economics of gift giving goes into more details.

The article brings me back to the days when Christmas shopping was a chore that required multiple trips to department stores and malls for gifts that would allow me to check off names on a list. In those days, the main concern was the people on the list, my budget, and what each recipient might like. Not would like, mind you. Might like. In those days, it seemed more important to check off the names than to get a truly appropriate and appreciated gift. I bought a lot of crap from those department store displays — you know, the rotating tie racks, the scarf and glove sets, the gift-packaged cologne. Easy gifts chosen by the store’s marketing department rather than the giver, generic gifts of the one-size-fits-all variety.

I was younger then. Not busier, but younger and less wise. Since then, I’ve realized that gift giving is more than just checking off names on a list. It’s finding the right gift for each person.

In my family, we cheat. In late November, we e-mail each other a list of items we’d like to get. Sometimes we include links to the items online. This is even easier if we maintain an Amazon.com wish list (as I do) or some other gift registry. Then we discuss it with each other to make sure there are no duplicates and shop online.

For example, suppose my sister in law had a wish list at the Gap that included 5 different items. I’d go check out her wish list and see that my budget allowed me to buy her two of them. (I always pick the ones that I like, too.) I’d then e-mail my sister and mother and tell them which items I was buying so neither of them would buy the same thing. They might each buy something else on the Gap list or perhaps something from another list. As a result, my sister in law would get exactly what she wanted with no duplicates.

It goes the same way with big gifts. Suppose my brother wanted some heavy-duty power tool. The price tag might be beyond what I’d normally spend, but if my sister chipped in, we could get it together. He’d get exactly what he wanted and my sister and I would both be done shopping for him within minutes.

In my case, Christmas shopping has become very easy. Not only do I buy just about all my gifts online these days, but I have them shipped right to the recipient. In the case of family members this year, they’re shipped right to the place the recipients will be — at my mother’s house. (She has already confirmed receipt of two of the three packages that will arrive.) If I was there, I’d take them from their shipping boxes and wrap them. But since I’m not, the shipping boxes become the wrapping. True, it’s not as attractive, but no one seems to mind. The only thing I miss is seeing the recipient’s faces as they pull out the gifts they really wanted.

I actually give gifts year-round. Not every day or week, mind you. Just occasionally. You know how it is. You go on vacation and see a shirt that’s perfect for a friend. There’s no reason for a gift, but the match is so good you can’t resist. So you buy it and bring it to your friend. I did this after my Thanksgiving trip. We’d been to a place called “Stan’s” and they sold t-shirts that said, in big letters, “If found, return to Stan’s” on the back of the shirt. I have a friend named Stan and I thought he’d get a kick out of it. So we bought it and gave it to him. I have another friend that we tease with SpongeBob SquarePants items. Every time I see something cool (but small; he lives in a fifth wheel), we pick it up for him. Gifts like these are seldom expensive, but they’re usually a good (or at least fun) match for the recipient. I get more pleasure out of giving these random gifts than Christmas or birthday gifts. I think it’s because it’s unexpected by the recipient and it makes them feel just a tiny bit special to be thought of for no apparent reason.

And isn’t that what gift giving is about? Making the recipient feel as if you’ve been thinking about him/her and what he/she might like?

Melon Investor Services Online

A poorly designed Web site.

You think that with the money they obviously have to spend, the folks at Mellon Investor Services would have used some real talent to build their Web site. They obviously didn’t.

Sure, it looks pretty, but it’s nearly impossible to navigate without clicking a bunch of wrong navigation buttons. And half the buttons you press spawn a new little window that displays a stop-light graphic and the message that the information is being accessed. The thing that bugged me the most was when I was required to change my pin to a 6-15 character number. It took me four tries to enter a number the system liked, and when I did, the dialog that appeared gave me the impression that I’d screwed up so bad that they were offering to do it for me. I later discovered that the PIN Manager wasn’t a person but a feature of the site that had been unlabeled as such.

Jakob Nielsen of Web usability fame would have a field day with the Mellon site.

I called for help when a feature I was trying to use kept displaying an error message. After various discussion and hold sessions with two different people on two different calls, I was asked to confirm that I was using Internet Explorer. I told her that I wasn’t, that I was using Firefox on a Mac and wouldn’t waste space on my hard disk with a Web browser that hadn’t been updated for four years. She obviously didn’t understand my sarcasm because she told me to “exit” Firefox and “start” Explorer. I repeated that I was on a Mac and if their site didn’t work on a Mac they were alienating a lot of users.

After another hold, I was told that her supervisor could duplicate the error message and that there was probably something wrong with the site.

Duh.

She then suggested that I try another time. By this time (30 minutes after my initial attempt to use the system), I was fed up and ready to hang up. But she had to get one last dig in: “Have I helped you with all your concerns today?”

“No,” I said. And I hung up.

The Wisdom of Warren Buffett

Why it’s a good thing that the second richest man in the world is giving his fortune to the richest man in the world.

Warren Buffett, the 75-year-old billionaire who made his fortune as an investor, has given $30 billion to the Bill and Melinda Gates Foundation. A very interesting article on Slate.com, “Wealthy and Wise” by Jacob Weisberg, provides some of Buffett’s rationale for doing such a thing.

Two things from the article that really struck me are:

Buffett’s views on the political subject of wealth are deeply American. Wealth like his can be justified temporarily as an expression of how much opportunity our social system affords. But passing it down across generations, he says, “flies in the face of a meritocratic society” and threatens to create the sort of aristocracy the founding fathers sought to prevent.

and

One of his [Buffett’s] aphorisms is that you should leave your kids enough to do anything, but not enough to do nothing.

I couldn’t agree more.

“No More Confusing Interest!”

“Just pay $7 per $1,000 outstanding balance per month!”

I guess Capital One thinks Americans are too stupid to understand how interest works. Kind of strange when you think about the level of debt most people carry. Experience should have taught them by now.

Yet yesterday I got a credit card offer from Capital One (not in my wallet). The ad promised “No more confusing interest” and that I’d only have to pay $7 per $1,000 of outstanding balance. Per month. On top of the minimum payment, of course.

I did the math. It isn’t difficult. 7 / 1000 = .007 x 12 = .084. That’s 8.4%.

I don’t know if that was a fixed interest rate. I shredded the offer right after doing the math. I doubt it, though — I don’t think you can get a fixed interest rate credit card anywhere these days. But, at the same time, I don’t think it’s such a good deal, especially when you can still get interest free intro credit cards. I got another offer for .99% for five or six months the day before yesterday.

On related matters, I realized yesterday that if I took advantage of a credit card offer for $20,000 cash advance at 0% interest for a full year, stuck enough in my checking account bank to cover minimum monthly payments at $250/month (that’s $3K), and invested the rest in an ING CD at 4.5%, I’d come away with a $705 profit, even after paying a cash advance fee of $75. (Yes, I created a spreadsheet to do the calculations for me. I did write a bunch of books about Excel, after all.) There’s no risk of loss — ING accounts are insured — but timing is everything. You need to have the principal ready to give back to the credit card company before that intro period is over. You might want to stick with a 9-month CD to make sure it’s available when you need it; the rate drops to 4.35% and the profit drops accordingly.

Once an accountant, always an accountant. I guess.

Some Interesting Reads

I told you I shouldn’t surf the ‘Net.

I’ve slipped into news junkie mode. But rather than get it from the television, I get it from the Internet, written by people who actually think.

Here are a few interesting reads:

Rescuing Jesus by Alessandro Camon on Salon.com discusses the hippocracy of the religious right.

Press Briefing (10/13/2005) by Scott McClellan on whitehouse.gov illustrates how the White House’s screw ups are not getting by the press unnoticed.

Fall of the Rovean Empire by Sidney Blumenthal on Salon.com discusses the politics, economics, and behind the scenes dealings of members of the Republican party.

Please don’t comment on these unless you’ve read them.