Craigslist: a most unusual near-monopoly

Wired's Gary Wolf gives a detailed look at Craiglist. This is truly a remarkable story of a business that is not in it to gouge consumers. Quite the opposite. Consider the eccentricities of the founder, Craig Newmark:

Newmark's claim of almost total disinterest in wealth dovetails with the way craigslist does business. Besides offering nearly all of its features for free, it scorns advertising, refuses investment, ignores design, and does not innovate. Ordinarily, a company that showed such complete disdain for the normal rules of business would be vulnerable to competition, but craigslist has no serious rivals. The glory of the site is its size and its price. But seen from another angle, craigslist is one of the strangest monopolies in history, where customers are locked in by fees set at zero and where the ambiance of neglect is not a way to extract more profit but the expression of a worldview. The axioms of this worldview are easy to state. "People are good and trustworthy and generally just concerned with getting through the day," Newmark says. If most people are good and their needs are simple, all you have to do to serve them well is build a minimal infrastructure allowing them to get together and work things out for themselves. Any additional features are almost certainly superfluous and could even be damaging.

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Control Your Controllables

One of my favorite economist reads, Paul Kedrosky, directed me to this image, which is from another excellent financial analysis blog done by Susan Woodward and Robert Hall. This is a comparison of labor numbers from now and 1981 rescaled to the size of today's labor force. Stunning. For those of you who, like me, were still in high school in 1981 - it was the biggest recession we have had in the US since the Great Depression. Not pretty. The graph shows us a partial image of how painful events are right now. Many people have lost homes, many are without work, and I have a feeling it is going to get worse before it gets better. There is a lot of suffering out there. I get a lot of calls from desperate people who are trying to put on a brave face. Sometimes I feel like I am barely hanging on to my life raft and folks are pulling on my legs to clamber on. In the midst of all this turmoil, with so much personal pain around me, how do I keep steady?

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