Israel(fest) Industry

Just taking a picture of a normal day at Queens College...with a camel! At Israelfest, one of main attractions was the camel. Israel is a desert, but has managed to overcome this major obstacle and now thrives.

Just taking a picture of a normal day at Queens College…with a camel! At Israelfest, one of main attractions was the camel. Israel is a desert, but has managed to overcome what could be a major obstacle in development and growth.

This week, Queens College resembled a normal college campus for the first time this entire semester. There was not just one, but two exciting events that took place. With perfect weather as an added bonus, the Quad was finally filled with happy students. The first event, on Monday, was Springfest. While it was not bacchanalian in nature like those of other colleges, Queens College’s Springfest was filled with innocent revelry. My eyes lit up when I saw that we could even get a Mr. Softee ice cream cone for free! Clearly, some students thought that the benefits of getting ice cream on that cloudless day outweighed the cost of waiting on a line that rivaled one outside Best Buy at 5 AM on Black Friday. I must admit that I shamelessly cut the line. I was expecting some form of condemnation, knowing how conspicuous I am, but no one said anything! #Yousnoozeyoulose

 

It's true: Bar Rafaeli, a famous supermodel hails from Israel. What's not true: the rumors I spread that Bar Rafaeli actually came to Queens College today. Sorry, boys.

What’s true: Bar Rafaeli, a famous supermodel, hails from Israel. What’s not true: the rumors I spread that Bar Rafaeli actually came to Queens College today. Sorry, boys.

The second event, and probably the last major event of the semester, was Israelfest. A celebration of Israeli culture, there was Israeli food, pottery making, a cutout of Israeli model Bar Rafaeli, and let’s not forget that camel that is more photogenic than I will ever be. Since this is my last blog of the semester, I thought that it would be appropriate to connect this post to this last event. Though still a fledgling country at 66 years old, Israeli is a key player in the American economy.

The United States has a certain portion of its yearly fiscal budget allocated to foreign aid. Israel is the second largest recipient of such aid, receiving $3 billion. An argument that often arises during times of a sluggish economy is that America would be better off if it cut foreign aid. The rationale is that with the extra money, America could spend more locally; in short, it should put itself first, before helping others.  While such logic make sense intuitively, it does not reflect the nature of aid or the actual flow of foreign aid funds. In fact, Israel spends 75% of aid in America. The size of the state of New Jersey, Israel does not have the capability to build many things it needs for its military, such as airplanes. The aid is instead used to pay American workers to construct them. As a result, America benefits from the increased employment and the steady stream of money.

The Arab Spring has thrown the Middle East for a loop. It has not only had an impact on the safety of the countries involved, but on their economies as well, making them rather tenuous and acutely sensitive to any nearby developments.

The Arab Spring has thrown the Middle East for a loop. It has not only had an impact on the safety of the countries involved, but on their economies as well, making them highly unpredictable and acutely sensitive to any nearby chnages. 

Not only does this allow for a stronger business rapport between the two countries, but also it helps maintain and reinforce their political alliance. Israel is the only stable democracy in the Middle East. Indeed, there is much political quarrelling there-but is that not a sign of any normal, healthy government? Considering the unpredictable state in Egypt, the civil war in Syria, and the recent surge in suicide bombings in Iraq, it is in America’s best interest to align itself with Israel.

As you can see, any point on the graph, called a Production Possibilities Frontier (PPF) depicts how much of a product a country can produce. Any point beyond the graph is considered more efficient, and can be achieved through trade.

As you can see, any point on the graph, called a Production Possibilities Frontier (PPF) depicts how much of a product a country can produce. Any point beyond the graph is considered more efficient, and can be achieved through trade.

An important way to align with another country is by conducting trade, which allows for efficiency. In economics, there are two important terms used in the context of trade. Absolute advantage is a party’s ability to produce more of a good using the same amount of resources; comparative advantage is a party’s ability to produce goods or services at a lower opportunity cost. Simply put, absolute advantage results in producing more stuff, and comparative advantage results in producing more stuff by having to give up less (for example, time). An important point to note is that a party can have an absolute advantage for multiple goods, but only have a comparative advantage for one good. When countries only produce goods for which they have a comparative advantage, and then trade with one another, both parties are better off, as they end up with more goods. In the case with Israel and America, the latter clearly has the absolute advantage when it comes to production because it is larger and has more resources. Yet, it does not always have a comparative advantage, and as a result, it benefits by trading with Israel.

Waze is a lifesaver when it comes to getting accurate directions. Did you know that it also informs you when police cars are nearby?

Waze is a lifesaver when it comes to getting accurate directions. Did you know that it also informs you when police cars are nearby?

Israel has been producing and inventing many products that benefit America both economically and in everyday life. Specifically, its strong suit is in the field of technology and biotechnology. Recently, an oral pill was created, which could be used in lieu of daily injections for people with diabetes. Imagine how much easier life will be for people who no longer have to suffer by pricking themselves on a daily basis! Israel has also made waves in the business world through its innovation. Google acquired Waze, a GPS app, for $1.15 billion. The company is still run in Israel, but the fact that a behemoth such as Google was willing to fork over such a hefty sum for a company with only 100 employees speaks volumes about the incredible potential of Israeli startups.

While this graph depicts an economy that is growing, America is still reeling from the financial crash in 2007. Completely distancing itself from one of its closest allies would have immediate, severe ramifications for the American economy.

This graph depicts an economy that is slowly growing, but America is still reeling from the financial crash in 2007. Completely distancing itself from one of its closest allies would have immediate, severe ramifications for the American economy.

Despite the plethora of positive consequences from conducting business with Israel, there is still a great deal of controversy. While I will not get into the politics here, a major threat to the future of Israel’s economy is the BDS movement. Proponents of BDS, which stands for boycott, divest, and sanctions, want to cripple the Israeli economy for a variety of political reasons. A major shortcoming of this movement, though, is that breaking ties with Israel, while indeed harming the targeted country, would also damage America’s economy. Economists largely agree that sanctions against countries cause major economic inefficiencies, as they prevent the benefits of trade from being realized. Indeed, the United States uses many basic things that originate from Israel; if the BDS movement were to be implemented in its totality, the American economy would plunge, and its citizens would not have access to many items that they utilize on a daily basis.

Sodastream is a ubiquitous feature in many homes, and it is an environmentally friendly replacement to accumulating plastic soda bottles. Despite receiving a great deal of pressure, Scarlett Johansson stood by the company.

Sodastream is a ubiquitous feature in many homes, and it is an environmentally friendly replacement to accumulating plastic soda bottles. Despite receiving a great deal of pressure, Scarlett Johansson stood by the company. (When was the last time I included so many celebrities in one blog?)

Most recently, a company that has been in the limelight as a result of the BDS movement was Sodastream. Sodastream has seen tremendous growth over the past few years; its products fly off the shelves in Walmart, and its spokesperson is Scarlett Johansson. Since its headquarters are in Maaleh Adumim, a city in the West Bank that is a source of contention between Israelis and Palestinians, proponents of the BDS movement have specifically targeted this company. It is important to note that both Palestinians and Israelis work side by side in the plant, both receiving equal pay and fair treatment. Perhaps BDS advocates in America should stop and think before pointing fingers, when so many American companies are guilty of outsourcing to countries where workers are paid a pittance and are forced to work in cramped, decrepit conditions…

Israel is a dynamic country that is making tremendous advances. Their business and technology sector, situated in Tel Aviv, is thriving and has a great deal of interactions with many American companies. With its unique culture and unparalleled drive, Israel is a force to be reckoned with in the business world.

Published in: on May 8, 2014 at 2:21 am Comments (1)

The $40 Freakout

Recently, SFC won the student government election, most likely in large part due to its recent achievement of establishing free printing in the library. (Thanks again!) This election was more significant than those of prior years because the ballot also included a referendum. The referendum was for funding a shuttle bus that would go to Main Street Flushing, the LIRR, and Queens Hall. To my utter shock, the referendum passed.

When I go to the city and use Public Transportation, I take the Q64 and then get a free transfer to the E. I can travel as much as I want on the subway for $2.50! (It used to be $2.25 before Superstorm Sandy, but the natural disaster generated tremendous losses for the MTA) Why would I choose to go on a more expensive option, such as the new shuttle?

When I go to the city and use Public Transportation, I take the Q64 and then get a free transfer to the E. I can travel as much as I want on the subway for $2.50! (It used to be $2.25 before Superstorm Sandy, but the natural disaster generated tremendous losses for the MTA) Why would I choose to go on a more expensive option, such as the new shuttle?

I was opposed to the shuttle bus for a variety of reasons. To be sure, I addressed my concerns and issues with the SFC candidates, who backed this proposition. Firstly, I was concerned by the limited amount of places where the bus would drive. Indeed, many students go to Flushing and the LIRR when traveling home, but a significant amount also go by the subway station in Forest Hills. How come the bus wouldn’t stop there? Also, after going on this bus, would one get a free transfer to the subway, as is possible with the MTA buses and subways? If the shuttle service was not carried out in conjunction with the MTA, riders, by paying both the shuttle fees and the MTA fare, would end up paying significantly more, all because of some mere convenience factor. A third problem I thought of was that the shuttle bus might impact traffic patterns around Queens College. How often would these buses come, and what would the travel route be? As for drivers, I wanted to know who would be hired, and what their credentials would be. Furthermore, since they are serving Queens College-a city school-would they be considered as employees of the city (and thus be eligible for certain perks or union membership)? There were many gaps in this plan, and many questions that remained unanswered.

If your class is half empty, it is either because it is the day before vacation, or there is bumper to bumper traffic on the Long Island Expressway. Despite their incessant gripes about the LIE, many students depend on the pathway as their only option to drive directly to Queens College.

If your class is half empty, it is either because it is the day before vacation, or there is bumper to bumper traffic on the Long Island Expressway. Despite their incessant gripes about the LIE, many students depend on the pathway as their only option to drive directly to Queens College.

Commuters also pointed out a major issue that had not crossed my mind. While the shuttle was intended to facilitate the commute for students who live at home, it would not be beneficial to all such students. Many live too far a distance from Queens College to take public transportation; in order to logistically get to class in a reasonable amount of time, they have no option but to drive. Because of the dearth of available street parking around Queens College, and because of the cutthroat nature of claiming a suddenly empty spot, many buy a parking spot located on campus for $250. These drivers will not be taking advantage of the shuttle, but will be forced to pay the $40 fee each semester regardless. That means that in a one year, students who commute will have to shell out over $300 exclusively for transportation purposes to Queens College-and that does not even include personal expenses for gas and tolls. From this perspective, it is clear why commuters staunchly believe that the shuttle bus is a colossal waste of money.

Juliet said "What's in a name? That which we call a rose by any other name would smell as sweet." Roses are pricy flowers, as will be our student fees next semester when an extra $40 is tacked on.

Juliet said “What’s in a name? That which we call a rose by any other name would smell as sweet.” Roses are pricy flowers, as will be our student fees next semester when an extra $40 is tacked on.

Labeling the $40 fee as an addition to Student Fees was an ingenious psychological move to sway voters. Associating the increase in payment with student fees sounds far more innocuous than saying it is a tuition hike. In reality, the name does not matter; students are still being forced to part with their precious dollars. I remember last semester when I noticed that my student fees had significantly increased. The woman at the Bursar’s Office attempted to reassure me by saying “At least it’s not an increase in your tuition!,” to which I gave her a look that read “Are you kidding me?” (raised right eyebrow, face tilted slightly to the right, emanating just the right of chutzpah to express my outrage without her feeling threatened enough to call security). You know what Shakespeare says about a name-except this time, we are not talking about something sweet.

I had come to resign to the fact that I would be paying more next semester, until I noticed, out of the corner of my eye, something curious in the library. Someone was distributing a petition to cancel the shuttle bus referendum. I was intrigued and read the entire sheet carefully. Indeed, it expressed my exact concerns and sentiments regarding the feasibility (read: impracticality) of the shuttle bus, but with a caveat: there was a small part that also mentioned negating the results of the elections, claiming that many votes were fraudulently cast because students were tricked into handing over their emails. I thought this latter part was absurd; everyone knows that it is election week, and it is their fault for not taking their vote seriously. (Most students who cast a vote put no thought as to whom they were voting for. That truly grinds my gears.) I signed on the line to override the referendum, but refused to sign the second line.

Legend has it that King George was able to read John Hancock's signature without his glasses it was so large. John Hancock clearly knew what he was agreeing to, when he penned this famous signature. If only people nowadays would heed what they signed...

Legend has it that King George was able to read John Hancock’s signature without his glasses it was so large. John Hancock clearly knew what he was agreeing to, when he penned this famous signature. If only people nowadays would heed what they signed…

As I spoke to more people about the petition, I was appalled by what I heard. They supported the petition, so they signed the sheet. Read: the ENTIRE sheet. Not bothering to read what they were about to stamp with their indelible John Hancock, people absentmindedly agreed to the clause that stated that the party election results should be overturned. When I informed my peers as to what they had agreed to, they were shocked. Many of those individuals proudly supported SFC. Ironically, the people who had claimed that votes had been fraudulently acquired were now exploiting unsuspecting individuals in the exact same fashion.

Businesses and companies frequently employ this exact tactic to ensnare customers. That there are people who still fall for the traps despite hearing horror stories serves to propel them to continue doing these unethical practices. I beseech of you  all to read contracts that you sign in their entirely, lest you agree to a lifetime of indentured servitude!

As students with a voice, we do not have to be enslaved to the status quo in Queens College. I do not know the fate of the shuttle bus, and have asked people if, on the chance that this operation is a bust, it could be canceled after one semester. I was “reassured” by a confident Maybe. Time will tell, but for now, I am off to catch the next bus to Forest Hills, provided exclusively by the MTA.

Published in: on May 7, 2014 at 2:54 am Comments (0)

Passover Business, Part II: The Aftermath

I mentioned in my last blog about how there is a tremendous amount of business associated with Passover. Interestingly enough, there is a great deal of post- Passover business, too.

blog 13.1

Once Passover ends, Jews are officially allowed to eat all kosher foods, including those that are leavened. Though the holiday is only eight days, many people think that it feels like an eternity. Indeed, there is a variety of foods available to eat. Nonetheless, knowing that something in particular is forbidden psychologically causes people to feel unbearably, excessively deprived. Cue the Egyt slavery jokes.

Definitely not of the same magnitude as lines on Black Friday. But all in the name of pizza? You bet.

Definitely not of the same magnitude as lines on Black Friday. But all in the name of pizza? You bet.

It comes as no surprise, then, that once Passover ends, there is a spiked demand for leavened foods. In particular, people crave pizza and donuts with such intense desire that one would think that these foods are rare delicacies (or that they have been starved for the past week. On the contrary, there are many heavy meals that are served.) Stores in my neighborhood have picked up on this opportunity for major sales and stay open very late after Passover ends. The scene is chaotic: people flock in and out of the stores to pick up huge orders, lines of teenagers go down the block, and the phones ring incessantly with calls from ravenous customers. It is shocking to see how Dunkin Donuts runs out of donuts almost immediately, and the pizzas fly off the shelves in the pizzerias. Interestingly, the pizza stores only sell entire pies, rather than bothering with individual slices; they wisely realize that it is more worthwhile to make whole pies than to invest their time cutting individual slices, which sell for less. Absolutely nothing has been done to these foods to make them tastier or cheaper. Rather, the level of desirability skyrockets is  based solely on the circumstances. Like I said, Passover plays an important economic role, shifting around normal supply and demand. I would venture to argue that in the three days following Passover, stores not only recoup the losses for having not been open the previous eight days, but actually come out on top and make a profit.

For a monopoly, there is only one supply curve. Since the demand is the only thing that is changing, in our case increasing, the price rises. Monopolies benefit because they do not have to worry about anyone else threatening them to lower current prices so as to entice customers.

For a monopoly, there is only one supply curve. Since the demand is the only thing that is changing, in our case increasing, the price rises. Monopolies benefit because they do not have to worry about anyone else threatening them to lower current prices so as to entice customers.

That there is so much potential for tremendous growth margins makes the scene on Main Street following Passover all the more shocking. Granted, people were busy organizing their homes and returning everything back to normal. Nonetheless, there is no excuse why all of the kosher pizza stores on Main Street were closed that night. It pained me that they were missing out on the opportunity to make their monthly profits at least double in matter of hours. I thought to myself at that moment that, had I not had three upcoming midterms and a major project, I would gladly have started making pizzas from scratch, and sold them from a temporary stand. I would have been a monopoly, the sole supplier, at least for the time being, and the money would have rolled in.

Stores do not want Passover foods to stay on the shelves once the holiday does not end. If people are not buying, then these items are wasting precious shelf space that could otherwise be given to foods that fly off the shelves.

Stores do not want Passover foods to stay on the shelves once the holiday does not end. If people are not buying, then these items are wasting precious shelf space that could otherwise be given to foods that fly off the shelves.

With the increase in demand for leavened food comes a decrease in demand for Passover foods. Stores are stuck with their excess supply of Passover foods that Jews suddenly have little interest in buying. In an attempt to entice buyers, the prices of the goods are slashed dramatically.  For example, my local Pathmark was already selling Matzah Meal at 75% off barely 2 days after Passover. While some might be disgusted at the sight of anything Matzah related after gorging on it for eight days straight, it is important not to block it out. Take advantage of these incredible savings by stocking up on some of the foods. No, not for now-you most certainly need a solid 3-month break from Matzah. Rather, save what you buy for next year’s Passover. Many of the goods have no expiration dates, so you can be rest assured that they will last. Passover is inherently an expensive holiday, so why not exploit an easy way to circumvent paying full price next time? I would also recommend buying discounted nuts, an item which is always expensive. Often times, stores do not realize that foods that are labeled kosher for Passover are normal foods that can be, and often times are, eaten year round, too. As a result, unnecessary discounts are given, there for you to benefit. Passover may be a time of extreme spending, but the time afterwards is an opportunity for extreme savings!

Published in: on April 30, 2014 at 8:22 pm Comments (0)

Passover Business

This was in an email I got from one of the QC clubs. This email epitomizes, on a small scale, the diversity that characterizes Queens College.

This was in an email I got from one of the QC clubs. This email epitomizes, on a small scale, the diversity that characterizes Queens College.

The onset of spring break is welcomed with open arms. Everyone agrees that it marks the start of a short period of respite from being constantly inundated with work (However, even that is not entirely accurate, considering the amount of papers and midterms due once we return!) Being the highly diverse campus on which it prides itself, Queens College has a student population that celebrates various holidays that coincide with this break. Many celebrate Good Friday and Easter. I, along with many other Jews, celebrate Passover. From an Economics and Finance lens, my opinion of Passover is that it has metamorphosed into a significant business boosting opportunity for the kosher food industry-a perspective that my Jewish constituents might very well consider sacrilegious given the highly religious and holy nature of this holiday.

The contents of this Seder plate represent a infinitismal part of what needs to be purchased for Passover. My family never buys romaine lettuce, but for this holiday, we buy lots of it.

The contents of this Seder plate represent a infinitesimal part of what needs to be purchased for Passover. My family never buys romaine lettuce, but for this holiday, we buy lots of it.

Most people immediately associate Passover with Matzo, wine, and the Exodus from Egypt. Those who celebrate the holiday dread the month-long countdown.  Even though it is only 8 days and an enjoyable time spent with family and friends, Passover entails a tremendous amount of preparation and work, perhaps rival to that of what the Israelites faced in Egypt. (How fitting!) All this work requires spending a ton of money. It is not uncommon that, on a shopping excursion at Shoprite, one spends upwards of $150-and there are multiple such trips. The reason behind the tremendous expense is not simply due to the high prices of kosher for Passover food. To understand why, think about what this holiday entails: 8 days of eating nothing with leavened bread (by Jewish law, we mean that the flour has not been exposed to

For the next 8 days I will not be able to eat any spaghetti. People might not realize that I will not be able to eat my mother's special meatballs either because those contain breadcrumbs. Most people use lots of eggs and potato starch to substitute, but I am acutely sensitive to the difference in taste.

For the next 8 days I will not be able to eat any spaghetti. People might not realize that I will not be able to eat my mother’s special meatballs either because those contain breadcrumbs. Most people use lots of eggs and potato starch to substitute, but I am acutely sensitive to the difference in taste.

water, from harvest through baking, for more than 18 minutes); people have developed customs of also refraining from rice and beans. To put that in perspective, for almost my entire Spring Break, I do not eat pizza, pretzels, chips, sushi, and hummus, as well as any food made in even the same facilities as any of these items. With so many forbidden foods, a complete overhaul of one’s pantry is necessary. As a result, people must replenish their food stock entirely. Moreover, people buy even more fruits and vegetables than usual in order to counterbalance the many heavy, albeit delicious, meals. Finally, each person is required to drink 4 cups of wine at each of the 2 Seders; on average, there are more than 5 people at a Seder. That ends up being a lot of wine-and a bottle of wine is not cheap. It comes as no surprise that with a new food stockpile, tons of produce, and a new supply of wine, people celebrating Passover, even without realizing it, quickly spend a small fortune. Try as you might-and trust me, I tried-it is nearly impossible to stay below a set budget, unless that threshold is unlimited.

Available for free at Shoprite are Haggadahs that are distributed by Maxwell House.

Available for free at Shoprite are Haggadahs that are distributed by Maxwell House. Disclaimer: My family has caught many mistakes in it.

With the potential for making a tremendous amount of revenue, it comes as no surprise that many companies choose to specialize in the market for Passover items. Stores, especially on the East Coast, predict the increased demand and therefore designate special aisles exclusively with kosher for Passover foods. Additionally, in trying to connect with customers, they frequently have promotions offering free boxes of Matzo after spending a certain amount. I have noticed that, over the years, there has been a growing selection of foods available. A distinct trait of the kosher for Passover foods industry is that it is dynamic in nature. Indeed, there are the normal brands that everyone associates with the holiday that produce the classic Jewish foods, such as Manischewitz grape juice and Rokeach gefilte fish. However, there are so many more possibilities to choose from today- people might just forget the severe limitations that are imposed on them for these 8 days. There are cake mixes, cookies, and other prepared foods that are delectable. Also, there are new products on the market that will spice up any dull meal. For example, there was a great deal of excitement in the Jewish community recently when the Orthodox Union, a top kosher agency, declared that quinoa can now be eaten on Passover.  Time for a new tradition!

I predict that I will gain at least 10 pounds over Passover because of all my mother’s delicious food, but right now I am doing a ton of exercise. My house is currently hectic because of the many last minute preparations to which we must attend. Of course, I need to squeeze in some time to seek out those Easter sales at the mall, so I must go!

 

Published in: on April 14, 2014 at 6:47 pm Comments (0)

It’s True: No more $15 for Printing –> Free Printing!

Last semester, I divulged the details behind the QC administration’s decision to no longer give $15 in printing money to students who complete teacher evaluations. I was thrilled to see that blog go quasi-viral, having been shared on Facebook by many outraged students. Knowing that each time I printed something I was depleting my precious printing money, I was extremely parsimonious when it came to printing pages. As a result, I struggled to read multiple 60- page reading assignments, all of which were single spaced, from my computer screen. There was barely $6 left on my card, and I refused to use it all in one class.

About a month ago, out of the blue, a friend of mine insisted I go to the next Technology Fee committee meeting because part of the agenda was to discuss and vote on the new budget. One of the allocations to be considered was money for free printing in the library. To say I was skeptical and cynical would be an understatement. I, along with fellow student members of the Technology Fee Committee, had fought tooth and nail to reinstate the policy of rewarding students with printing money for filling out teacher evaluations. Now, they would suddenly be willing to simply allow students to print free of charge?

After some investigating, I discovered that SFC was behind this proposal. Everything clicked. This was a politically motivated move, carried out right before elections so that it would be fresh in students’ minds when they considered for whom they would vote.

At the Tech Fee committee meeting, there were two SFC members present. When the proposal came up for discussion, it received immediate backing from students, and vehement opposition from administrators. The latter alleged that funding for free printing did not fall under the Tech Fee category. Supporting our fellow SFC peers,  Tech Fee committee student members came to the defense of our SFC peers’ proposal, and cogently argued, with prior knowledge of how the committee’s funds are indeed allowed to be allocated, that the funding of free printing did directly enhance student learning through the use of technology. I even argued once I saw that this was a losing battle that at the very least the money currently on our cards should roll over to the next semester; since we were not able to get more, we should at least be able to keep what we have. Once we went through the proposed budget, it appeared that Queens College would be running a $2M deficit in 2015. We realized that certain costs clearly could not be avoided, and that the provost perceived our arguments to be tenuous, at best. I left the meeting unsurprised, and said to the dejected SFC members, “I should have warned you…”

I was shocked to receive a follow-up email barely a week later, stating that there had been some major numerical errors in the calculations, including accidentally doubling salaries. In fact, there was enough money for printing, and the Provost had decided that the Technology Fee Committee could cover it. With a long email feed in which people succinctly responded “I approve” (thus hiding my elation), free printing in the QC library had officially been implemented!

I was very excited to see that we now have free printing, but I made sure to discuss with others that this was not a free for all. Economics is the study of the allocation of scarce resources. There is a finite amount of every type of good in the world. When students were forced to pay, they were more conservative in their printing habits; they only printed when they needed to, such as for essays and documents. Now, since it is free, there is nothing stopping them from printing as much as they like. In the short run this might seem great. In this long run, though, this bears serious potential consequences. Having over 20,000 students print as much as they want is not sustainable. Queens College cannot afford to supply that quantity of toner, paper, and ink. If students continue to print so much, Queens College might very well revoke the free printing. We have seen them do it before, and they could do it again. Except the next time, Queens College might not give any money to students to fill out student evaluations. So while you should definitely be grateful for the option of free printing on campus, do not exploit it and ruin it for the rest of us!

Published in: on April 13, 2014 at 9:03 pm Comments (0)

My Most Powerful Shopping Secret, Part II: Online Shopping and Outlet Stores

A lot of my friends seem to think that Lord & Taylor is synonymous with matronly. This is certainly not the case, and I find such an insult to be a personal affront!

A lot of my friends seem to think that Lord & Taylor is synonymous with matronly. This is certainly not the case, and I find such an insult to be a personal affront! (Most of Lord & Taylor’s clothing does NOT look like the above outfit.)

Last week, I shared with you all of my secrets about how I manage to shop at Lord & Taylor so frequently, but while still conserving the contents of my bank account. Unfortunately, most people I know do not share the same positive sentiments I hold toward Lord & Taylor, a place where you can buy clothing ranging from comfortable t-shirts to fancy dresses. They say that they go there once in a blue moon, which I cannot fathom; they are simply not as enamored by the store as I am. Indeed, it is true that you cannot stock your entire wardrobe by shopping there exclusively (although they do have the perfect LBDs!). Thus, my second major shopping tip for saving money: take advantage of deals available online and go shopping at outlet stores.

A typical Black Friday crowd. Now imagine how much worse it would be if there were no online outlet for the other thousands of shoppers  to shop!

A typical Black Friday crowd. Now imagine how much worse it would be if there were no online outlet for the other thousands of shoppers to shop!

Online shopping has taken almost every economic industry by storm. Stores can no longer depend on consumers to walk into their stores, despite governmental promises that revenue and sales will rise once the economy recovers. This can be seen most visibly the numbers on Black Friday in 2013: online shopping rose 15% last year, to a staggering $1.2 B. Many people no longer feel the need to go out shopping when they can do so in the confines of their home. There is a convenience factor to online shopping, in which you can simply place an order-the rest of the work in subsequently done for you. Except, of course, for opening those boxes that are stubbornly sealed shut!

Online businesses facilitate the process of achieving better deals than can be found at brick and mortar stores. They can afford to do so because they need not worry about many costs that regular stores must contend with on a monthly basis. Indeed, overhead expenses, which are one of the largest costs for running a business, are virtually absent.

The word's most popular shoe store...and I've never even checked it out until now. What can I say, when it comes to shoes, Lord & Taylor has my loyalty.

The word’s most popular shoe store…and I’ve never even checked it out until now. What can I say, when it comes to shoes, Lord & Taylor has my loyalty.

To get clothing online, people often flock to company websites; to get shoes online, most go to Zappos. Zappos has a great business model, in which it provides free shipping as well as next day delivery. According to a friend of mine, Zappos truly keeps this promise. She was such a convincingly satisfied customer that I just might take a look there.

Before I check Zappos, though, I will stick to my method. When I buy clothing or shoes online, I go to ebay. People think I am insane for doing this; reactions range from “How do you know it will fit?” to “How do you know it’s not used?” I especially do not get any slack for the latter when I am buying shoes. My answer to these questions: I don’t. However, in my experience, descriptions of the items, as well as pictures from many angles, are accurate. For clothing, I look for the tag-it is a red flag if it is missing. Then, I either go to the store to see the item in person, or flock to the store’s website to see the official picture and retail price. Only then do I determine whether or not I want to buy the item. When it comes to clothing being sold by an infrequent ebay seller, you often can bid, leaving room for tremendous savings. However, a new trend has emerged on ebay, in which people who sell large volumes of clothing create a virtual “store”. While the prices are often fixed, the major boon of the virtual store is that you can browse for multiple items that are similar in style. In that respect, virtual stores similar to brick and mortal ones, except for the fact that you need not lug around clothing you are considering, nor must you tirelessly go through many racks. In my experience, I have had much success using both ebay forums, and I am happy to say that all the items were unused and cost far below retail. The major downside to online shopping, through, is that sellers often force you to pay more by charging outrageous sums for shipping. Really, there is no need for something, unless it is china or porcelain, to require priority mail! In some cases, I have actually decided against buying something, despite the item’s low price, because the final cost of the transaction actually exceeded the retail price!

Just seeing this sign makes me nostalgic. Daffy's motto really resonated with me, as you can imagine.

Just seeing this sign makes me nostalgic.

While shopping online is all the rage nowadays, do not forget about the opportunity for extreme savings at brick and mortar stores (in addition to Lord & Taylor). In the past, there used to be many off-price retailer stores. In places such as Syms, Filene’s Basement, and Daffy’s, one could buy various designer duds at a discount. Personally, I was not so keen on these stores, which had a tendency to sell clothing that looked rather dated. Daffy’s, in particular, was a hit or miss store. Unfortunately, due to the financial pressure from the Great Recession and the growing competition from online shopping, many were forced to declare bankruptcy and liquidate (convert all assets, such as inventory, to cash by selling them so as to pay off existing debts).

Secret: At Banana Republic Factory Store and Gap Outlet, show your AAA card to get an additional 10% off! Crazy enough, this discount doesn't apply to the regular stores!

Secret: At Banana Republic Factory Store and Gap Outlet, show your AAA card to get an additional 10% off! Crazy enough, this discount doesn’t apply to the regular stores!

With the disappearance of such stores, what’s a frugal girl like me to do? Two words: outlet stores. These stores are extensions of the original stores, carrying what was not sold. The fact that this merchandise was not sold does not indicate poor quality. It could very well be that the company manufactured in excess, and therefore selling so much at the original stores was not feasible. Prices at the outlet stores are usually substantially less than those of the original ones. But be careful of a ubiquitous trick they sometimes do. Say, for example, an item is significantly reduced at Gap. If it still does not sell, and gets moved to Gap Outlet, the price of the item might be returned to normal, or have a less substantial markdown. If you want to guarantee that you are paying less than the original price, look at the sales and clearance section-that is where I find my best deals! I love casually telling people that I paid a mere $8 for a certain skirt from Banana Republic. (I do not think it is dishonest to say this, even if it is from the outlet store, because both sell the same merchandise.) Just like the case with Lord & Taylor, you can buy quality clothing for major markdowns, but still look trendy and chic.

I hope this blog will further help you save money when you go shopping for clothing for Spring Break! It might be tempting to splurge on the new arrivals for the summer, but I beseech of you to not give in!

Published in: on April 3, 2014 at 4:17 am Comments (0)

My Most Powerful Shopping Secret: How to Shop at Lord & Taylor for Cheap

When you see the sign for Lord & Taylor, you should not be intimidated by the artificially high prices of new inventory. The possibilities for major savings are infinite!

When you see the sign for Lord & Taylor, you should not be intimidated by the prospect of artificially high prices on new inventory. The possibilities for major savings are infinite!

As someone with a reputation for being able to buy anything and everything at rock bottom prices, I am often inundated with requests to join friends in their shopping excursions. With a few rare exceptions, I go shopping solo, to the chagrin of many. I do this not because I am anti-social (I frequently chat with store employees and friends whom I bump into), but rather because I feel that my slow perusal of all the racks will bore them and make them impatient. To everyone’s surprise, myself included, I find the best bargains (or as I say in Hebrew, metzias) at Lord & Taylor. The other day I had an incredibly successful trip there, paying barely 10% retail. Having critically analyzed Lord & Taylor’s business structure, I have uncovered a foolproof way to exploit maximum savings.

Lord & Taylor markets itself as being glam and too expensive for the layman. Who goes around looking like this?

Lord & Taylor markets itself as being glam and too expensive for the layman. Who goes around looking like this?

When I tell people who are on a tight budget to try Lord & Taylor, I am met with severe skepticism. The public perception is that it is an upscale chain geared toward the Upper-Middle class. Lord & Taylor promotes this image by selling luxury labels and formal attire. Moreover, you often see well-off, middle-aged women shopping for a cocktail dress for the new season. But then, of course, there’s me, looking disheveled in a graphic t-shirt and a messy bun, and on the prowl for a good deal.

Lord & Taylor facilitates the bargain hunting process. However, you must be willing to exhibit self-control. No matter how much you fall in love with something from the new season’s shipment, you must resist buying. Paying the original, full price is antithetical to the fundamentals of bargain hunting, and it pains me to know that the store can successfully take complete advantage of you.

Don't worry if you forget to print it-you can get Lord & Taylor to automatically text it to you!

Don’t worry if you forget to print it-you can get Lord & Taylor to automatically text it to you!

In order to maximize savings, it is critical that Lord & Taylor is both having a sale and is circulating a coupon; if you go when only one is true, you will not achieve the absolute best deals. The possible coupons issued are 15% off regular priced items, 20% off sale and clearance, and, my personal favorite, $20 off $40 or more. (You can even combine the latter with one of the former coupons!)  My theory for why Lord & Taylor began issuing the money bonus coupons is to increase the cash flow in the stores; even with a loss of $20, it will still increase its cash on hand by at least $20, if not more (it is often difficult, but certainly not impossible, to spend exactly $40). But be careful, as sometimes you are not able to use the savings pass on their special Anniversary Sale, which is currently going on. In order to get the biggest bang for your buck, flock to the clearance rack and use these coupons- you will get savings on top of the discounted prices. Clearance often has a stigma attached to it. However, in Lord & Taylor, with its selection of fancy clothing and shoes, this section is of the same quality as the rest of the store, albeit a bit messier.

This is another good deal I got. Unfortunately, the employees were very anal about the minimum purchase price being $40; $39.99 was too little. Not to be deterred, I headed to the clearance section in the socks department. That put me over the minimum required balance, and I got the sweater for around $16. A good deal, considering the fact that it is Cashmere(so soft)!

This is another good deal I got. Unfortunately, the employees were very anal about the minimum purchase price being $40; $39.99 was too little. Not to be deterred, I headed to the clearance section in the socks department. That put me over the minimum required balance, and I got the sweater for around $16. A good deal, considering the fact that it is Cashmere(so soft)!

This plan sounds good in theory, but does it work? Yes. Recently, I bought a dress that, on clearance, was $30, but with a 20% coupon, cost $24. On Friday, I returned to Lord & Taylor and found a nice shirt for $10. A light bulb went off in my head. I returned the dress and rebought it with the shirt, for a total price of $40. I had a $20 off $40 bonus coupon as well as the 20% coupon, and ultimately paid $16-paying less for 2 items than what I had originally paid for just the dress. Did I mention that the dress is Ralph Lauren and originally retails for $135? If that isn’t proof enough, then I do not know what will convince you!

Part of the appeal of Lord & Taylor is that shoppers can have a shopping experience in a neat, relaxed ambience. By having so much clothing, Lord & Taylor often gets cluttered and messy. An aesthetically unappealing store will deter customers, guaranteed.

Part of the appeal of Lord & Taylor is that shoppers can have a shopping experience in a neat, relaxed ambience. By having so much clothing, Lord & Taylor often gets cluttered and messy. An aesthetically unappealing store will deter customers, guaranteed.

The reason I am able to get such good deals is not only due to my penchant for perceiving them from a distance. Lord & Taylor in particular has a terrible business model, which makes bargain hunting extremely easy. The main reason Lord & Taylor is not growing like its competitors is due to a major flaw: excessive inventory. Lord & Taylor gets far too much clothing and shoes, much more than it can possibly sell. Consequently, it is often forced to sell them at the end of the season at a loss.  One would think that a chain that prides itself on its exclusive ambience would try to distinguish itself from Target, which often suffers a similar problem. The only difference, though, is that Target has a high inventory turnover rate, meaning that the goods do not stay on the shelves for very long before being bought. This is not the case with Lord & Taylor, where a pricy item will linger on the rack. And forget about trying to clench an extra discount by pointing out that something is ‘Defective Merchandise’. Normally, stores do not want such inventory, and are willing to sell it at a discount because people will otherwise not buy it. Lord & Taylor corporate policy, on the other hand, is now not to give discounts for such items, but rather to ship them back to headquarters. Not only do they make a loss by not selling the good, but also they must pay even more to transport it again. Another bizarre policy I have noticed is of returning clearance priced items back to the original price (if the same style is reissued for the new season). Suddenly, my Sperry’s that I bought for $24 scan for $80!

I am afraid that these bad policies will lead to the demise of my favorite store. I love getting a terrific bargain, but I would be upset if Lord & Taylor were forced out of business due to mismanagement. Regardless of the corporate policies, it would behoove you to immediately take advantage of the possibility for extreme savings!

Published in: on March 30, 2014 at 4:38 am Comments (0)

Facebook Fiasco: The Acquisition of Whatsapp

You are deluding yourself if you say that you do not see this name at least thrice a day.

You are deluding yourself if you say that you do not see this image at least five times a day.

On both our smartphones and our computers, Facebook dominates our lives. It plays a major role in society, whether we would like to admit it or not (I will admit it. But I am not addicted-I swear!) Thus, it makes sense that anything Facebook does causes a major stir among investors. It bought Instagram nearly 2 years ago for $1 Billion (a genius move considering Instagram’s popularity among both people and companies alike) and, as I previously discussed, it went public. Most recently, Facebook made headlines when it announced that it would be acquiring Whatsapp for a staggering $19 Billion. (“Leora, let me guess, your next blog is going to be about Facebook’s acquisition of Whatsapp, right?” asked a friend of mine. Just to prove him wrong, I am writing about this event now, a few weeks later, after having followed the latest developments. I refuse to be predictable!) This pricey business move, which involves two widely recognized companies, speaks volumes about the nature of mergers and acquisitions, and will have a tremendous impact on Facebook as we know it.

In the investment world, and especially the young and highly unpredictable technology field, $19 billion is a significant sum. Facebook will be acquiring Whatsapp in a combined deal of cash and equity: $4 billion cash and $12 billion of stock (the rest over the course of 4 years). Obviously, Facebook is not carrying out this deal entirely in cold cash; having so much free cash flow would actually be disconcerting, for it would indicate that the company is not wisely investing its money in developments and market securities.

There are so many social media platforms nowadays. Facebook felt the pressure to make it sure it remains on top. It doesn't want to end up like Myspace. Who uses Myspace nowadays? Exactly.

There are so many social media platforms nowadays. Facebook felt the pressure to make sure it remains on top. It doesn’t want to end up like Myspace. Who uses Myspace nowadays? Exactly.

Why did Facebook decide to acquire Whatsapp? Simple: it wants to dominate the social media market. Beforehand, it faced little competition. Now, it must contend with various other social media outlets/communication platforms that take away its users. It is not uncommon to hear people, especially hipsters, proclaim that they are done with Facebook and have deactivated their account. (Ironically, these same people post filtered pictures on Instagram ad nauseam. Facebook owns Instagram, remember?) Facebook noticed that its popularity was waning, especially in comparison to Whatsapp. The truth lay in the numbers: Facebook has 100 million users, while Whatsapp has 450 million users. While I am not part of the latter statistic since I do not have a smartphone, I was aware of Whatapp’s strong presence. Facebook was, too, and decided to be proactive about this competition.

Based on the graph, it is clear that Whatsapp has exploded in popularity. Yet when determining the price, one must analyze various metrics-ie EBITDA, P/E ratio, ROE, ROA...

Based on the graph, it is clear that Whatsapp has exploded in popularity. Yet when determining the price, one must analyze various metrics, such as EBITDA, P/E ratio, ROE, ROA… These are some simple metrics that are important to know if you consider investing in the stock market.

 

Getting rid of the competition before it is too late is a wise business move. But at $19 billion, did Facebook overpay? Granted, Whatsapp is a ubiquitous feature on many a smartphone. However, the acquisition price must reflect a number of factors. When calculating the purchase price, the buyer must consider yearly profits, the target’s total debts, the industry multiple, and goodwill, to name a few factors. Purchasing a technology company for so much money conjures up memories of the early ‘00s, during the dot com bubble-and the subsequent crash. Companies paid exorbitant amounts to acquire other target companies, anticipating that the value of these companies would continue to appreciate in value; unfortunately, most were forced to ultimately declare bankruptcy. This leads me to wonder: is Facebook so confident in its future success that it believes it can avoid the same fate as those of many top-performing companies nearly a decade ago?

Mergers and acquisions are frequent in the airline industry. This definitely has something to do with teh fact that the airline industry is a money losing business, for they have high fixed costs but are always concerned with covering the marginal costs by filling that last seat right before takeoff. Unfortunately, fewer companies means less competition, which results in higher prices.

Mergers and acquisitions are frequent in the airline industry. This definitely has something to do with the fact that the airline industry is a money losing business; they have high fixed costs, but are always concerned with covering the marginal costs by filling that last seat right before takeoff. Unfortunately, fewer companies means less competition, which results in higher prices.

 

While mergers and actions occur often, we only hear about them when they involve large companies (Note: acquisitions entail one company swallowing up another. Mergers involve combining companies into a distinct, new one, and it is usually marked by a name change.) Not only is there more publicity because people are interested in fate of their shares, but also because the government may choose to get involved. Since America has a mixed economy, the federal government might get involved when companies try to merge or acquire one another in order to prevent monopolies from forming. Monopolies do not allow for any competition, thereby enabling businesses to charge whatever price they wish. In this instance, the government’s role is to protect the people from being exploited by callous businessmen. (Next time, though, try exhibiting more efficiency. Government shutdown, anyone?) There are many laws, such as the Sherman Anti Trust Act and the Clayton Anti Trust Act, that were put in play about a century ago to do just that. Clearly, the more things change, the more they stay the same: the fact that these laws are still so relevant proves that business is still business, no matter the era.

I personally think that the acquisition of Whatsapp was a mistake. Not only do I think that Facebook overpaid, but I also think that the companies will not work well together. Whatsapp is inherently private, while Facebook is marked by its public space. Such fundamental differences will breed major problems in the future. After all, an important determinant of a successful merger/acquisition is that the company culture and ideals mesh well. In this case, Whatsapp will ultimately sacrifice its unique identity for the sake of bolstering Facebook’s popularity. One thing is certainly clear: once this acquisition is carried out, Facebook will surely metamorphose into Worldbook.

Published in: on March 18, 2014 at 2:57 am Comments (3)

JP Morgan Trip with Queens College

In addition to being in charge of NPP, Professor Miller is also a professor in the BALA program.

In addition to being in charge of NPP, Professor Miller is also a professor in the BALA program.

About two weeks ago, I had the incredible opportunity to participate in the New Professional’s Program event entitled “Day on Wall Street”. For those of you who do not know, New Professionals Program is a recently established student service that provides various methods of training and preparation for entering the job market. Since there is so much competition when applying to a job, you should definitely take advantage of this invaluable resource. Veterans in the business world, Professor Denise Miller and Ms. Diane Shultz are responsible for NPP’s instant success; it baffles me how Queens College students survived without having their guidance! But I digress. The goal of this event, which took place at JP Morgan, was to give students who are contemplating a career in finance a glimpse into what the job entails. Though I was there for only 7 hours-a fraction of any employee’s workday- I gleaned a tremendous amount in a day packed with information.

After waking up at 5:30 AM (on my day off!) and bracing the biting cold, I arrived at JP Morgan ready for what lay in store. The first item on the itinerary was the Morning Call, in which a panel of about 4 individuals explained, discussed, and analyzed the contents of a confidential handout that listed industry trends, different companies, and business strategies to the audience of employees. Sitting in the back row with my fellow Queens College peers, I looked around the room and noticed a pattern. Besides for the fact that JCrew or Banana Republic seemed to be the popular choice of attire, almost everyone carried a Starbucks venti coffee. I pride myself in never drinking coffee, but I was not surprised to see this, considering the long day in store for them!

Just to avoid a lawsuit, I blacked out the names of the people who met with us. As you can see, it was a packed day!

Just to avoid the possibility of a lawsuit, I blacked out the names of the people who met with us. As you can see, it was a packed day!

Following the Morning Call, we headed off to a pristine business room where we were treated to a delicious breakfast. Now that we were fully awake, we heard from a variety of speakers. There had been a great deal of thought put into planning this event, and it showed. The order of the speakers went up the ranks of employees, from analysts to associates to bankers. The progression reflected the JP Morgan culture; as you work there longer, you get promoted to a higher position.  After each group of speakers, we had a ‘break’, which functioned as time to network with the speakers one on one. In my opinion, these networking opportunities were the most invaluable part of the day: we were able to converse with the employees and get personal advice. At first, the prospect of networking with so many successful businesspeople intimidated me, but soon enough I was comfortable, knowing that these individuals were just human, and had once started out in my position, too.

Over the course of the day, there were certain themes and lessons that were reinforced. Firstly, all the employees emphasized the importance of being a team player. I was initially skeptical, given JP Morgan’s indelible label as being cutthroat. However, as I thought about it, I realized that being extremely driven and being a team player are two characteristics that are not mutually exclusive. Rather, they are ingredients that together result in maximum success.

Achieving success, and ultimately getting places, is impossible to do on your own; nobody gets anywhere by themself. A second important lesson was that networking is crucial. It happens everywhere, whether you realize it or not. Furthermore, connections you foster must be maintained; it is not enough to simply strike up a conversation with someone, never to speak to them again. You want people to remember you.

JP Morgan and Morgan Stanley. Both have a similar name, but are NOT to be confused.

JP Morgan and Morgan Stanley. Both have a similar name, but are NOT to be confused.

Lastly, they emphasized the importance of being scrupulous. They mentioned instances of reading cover letters in which people write about Morgan Stanley, which is an automatic X. When applying to many places, it is easy to get mixed up. However, companies as prestigious as JP Morgan seek excellence and perfection. An application is a reflection of you, and therefore any egregious mistake indicates that you are an unqualified candidate.

By the time I left JP Morgan, I felt that I had had an extremely worthwhile, enriching experience there. Unlike many others I have attended, this business event remained true to its title. It was informative, engaging, and interesting, and I look forward to going to another one in the near future!

Published in: on March 12, 2014 at 2:06 am Comments (1)

SAT Inc

Achieve more? Give me a break.

Achieve more? Give me a break.

The SATs. Just the mention of that three letter term (it is no longer an acronym) sends shivers up and down my spine. For most people, talking about the test evokes terrible memories of a difficult time in high school that have been tucked away, unsuccessfully, into oblivion. With so many people having taken it, there are a handful of discernable SAT archetypes that I have identified:

  1. The Overachiever: Preparing since the womb, this stressed individual carries vocabulary flashcards in one hand, and an SAT review book in the other.
  2. The Oblivious One: There is always that one person who forgets something vital the day of the test, such as a calculator or a #2 pencil. While fellow test takers shower this person with sympathy, they secretly think, ”At least it did not happen to me!”
  3. The Underdog: Completely under the radar, this person surprises everyone by doing well. Diligence and/or tutoring helps.
  4. The Braggart: The one who goes around and makes sure that everyone knows his/her impressive score.
  5. The Hated One: The person who barely puts any effort into studying, and gets the highest score. In the ensuing weeks, admirers swarm him/her, while secretly spewing venomous hateful comments in sheer jealously.
  6. The Holy Grail: Someone who manages to balance studying and relaxing, and ultimately succeeds on the test without compromising their sanity. Disclaimer: this individual does not exist.

The SAT plays a crucial role in our society by contributing stress to high school juniors as well as to the overall college application process. Recently, College Board announced that it would be implementing several changes to this standardized test. Though ostensibly innocuous, these changes reflect the true nature of the SAT. This test is not a way to gauge the intellectual capabilities of students; rather, is a money-making scheme.

Atticus Finch was a man of courage and integrity, both inside and out. College Board promotes itself as a company dedicated to higher learning for students, but in reality is seeking profits-just like any other business.

Atticus Finch was a virtuous man of courage and integrity, both inside and out. College Board promotes itself as a company dedicated to higher learning for students, but in reality is seeking profits-just like any other business.

Significant changes have not been made to the SAT since 2005, when the highest composite score was raised to 2400 from 1600 due to the addition of the essay section. Now the scores will return to being out of 1600. The optional essay will be focused more on expressing experiences and opinions, rather than answering prompts. So much for using the tried and true formula of using one literary and one historical example as support-Atticus Finch and the Civil War never let me down. Words deemed too obsolete will also be replaced with jargon more often used in college. Additionally, math concepts will be more focused, with some sections not allowing the use of a calculator. My jaw dropped, though, when I discovered that there would no longer be a ¼ point penalty for wrong answers. This is not the SAT that I had come to hate.

Why is it that the College Board decided to make such drastic changes? College Board is echoing arguments that teachers have been making for years: the SAT is disconnected with the work of high schools. Many of the words that students memorize, not learn, for the SAT are neither used in the classroom nor are part of everyday vernacular. In the math section, questions are often characterized as being “SAT” in nature, and never actually covered in a school curriculum.

In reality, though, I think College Board is trying to make the SAT more attractive because it recognizes that the ACT is a serious threat. While the SAT costs $51 to take and penalizes for the wrong answer, the ACT is $50.50 and allows for guessing without penalty. With people finding the ACT to be more manageable, as well as colleges now accepting it as a substitute for the SAT, more students are registering for this exam instead. College Board now sees that where it once held a firm monopoly, it now faces legitimate competition. Seeing that its current testing policy was unpopular, College Board, like any company desperate to reverse a downward spiral, decided to spice things up.

Every year there is a new official SAT study guide book. Not only does College Board make money from the registration fees, but also from the preparation that goes into taking the test, too.

Every year there is a new official SAT study guide book. Not only does College Board make money from the registration fees, but also from the preparation that goes into taking the test, too.

Of course, everything about the SAT is about making money; the registration fee is simply icing on the cake. There are pricy “new” SAT books that must be updated every year. Once you have the books, you must also hire a tutor. The SAT is notorious for not testing intelligence, but rather for testing the ability to take the SAT-a skill that no teacher can ever impart to a student. (When I volunteered as an SAT math tutor, people could not fathom why I would give up the change to do the exact same thing, except for at least $80 an hour-the starting rate for a novice SAT tutor.) Clearly, this puts underprivileged kids at a disadvantage when they do not have the financial means to gain access to unlocking the code to conquering the SAT. Furthermore, by giving the option of score choice, College Board is favoring students who can afford to take the test multiple times. Also, did I mention that there are fees for sending SAT scores to colleges? By the end of the entire SAT process, parents can easily fork down $3000. Is $1000 a letter really worth it?

It is scary to think that these filled in bubbles can play a significant role in the college you attend.

It is scary to think that these filled in bubbles can play a significant role in the college you attend.

Ultimately, there is a fundamental issue with the SAT as well as the ACT. Why is it that a significant determinant for most Americans to get accepted into college is a test compiled by 2 private companies? College Board feigns sympathy for the test takers by having a Question of the Day, but in reality, it exploits them. Perhaps having a government mandated test, rather than one made by an arbitrarily powerful one, would fairer? New York City has regents, why can’t there be a national version of this?

Published in: on March 6, 2014 at 2:37 am Comments (5)

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