As the author says himself, he hasn’t attended in 30 years. I understand some of the things he’s complaining about, but I don’t think that is the dominant experience of being there.
Credit cards also transfer wealth from people who pay interest to people who don’t.
It’s a silly system, where everyone has to invest their time (optimizing for rewards, avoiding interest) in an ultimately negative sum game. I hate it so much.
What does that graph tell you? Because I think patio11 wanted to send one message and people accidentally misunderstand the graph.
That's the interchange income corresponding to wealthy people. Interchange is paid by the card-accepting business, not by the buyer. The buyer pays interest and other fees and that graph looks very different.
From that original study the full picture table says in % of ADB that the "poorest" (below 620 FICO) pay ~45% interest and fees but bring only 2% additionally in interchange income. The wealthy (at 800+) pay ~10% interest and fees but bring another almost 10% interchange income, on 4 times higher spending, and 3 times higher rewards (so the wealthy get ~12 times higher rewards in $ value than the "poor").
Just the percentages paid by each group more than offset the difference in spending. There are also way more "poor" accounts than wealthy accounts. Intuitively you can tell that the banks are effectively subsidizing the fees and interest for the wealthy with the income from the poor, for the sake of the interchange income which is mostly generated by the wealthy but doesn't come from their pocket.
Those poorest of people (<620 FICO) pay more interest and fees (percentage and absolute terms) than any other group. There's a range in the middle on the wealth scale where the customers are actually a net loss for the banks (the 660-760 FICO range).
Businesses raise prices to account for interchange fees. So they are essentially is paid by the consumer. If we outlawed rewards credit cards (by capping interchange fees), everything would likely be slightly cheaper.
> Businesses raise prices to account for interchange fees
Agreed, which makes the picture even worse for those low income people. Even poor people are guaranteed to occasionally pay the "rich person tax" included in the prices of some of the products and services. At least until some AI pricing starts changing the price real-time based on the buyer's estimated wealth (sort of already real).
> So they are essentially is paid by the consumer.
Not from a bank's perspective. Only in the sense that prices are higher between the seller and buyer.
> If we outlawed rewards credit cards (by capping interchange fees), everything would likely be slightly cheaper.
I don't agree on the second point as a blanket statement. When Epic game store lowered its fee not a single game got cheaper for the buyers.
> Agreed, which makes the picture even worse for those low income people. Even poor people are guaranteed to occasionally pay the "rich person tax" included in the prices of some of the products and services.
Credit card fees are baked into the price of everything that can be purchased with credit card, excluding merchants that offer a cash price and a credit price.
Any time someone pays the (credit card) price with cash or a debit card is paying more than someone that earns CC rewards, it’s virtually every transaction.
>When Epic game store lowered its fee not a single game got cheaper for the buyers.
At least one reason for this is that Valve has language in their agreements to prevent you from selling your game cheaper on other storefronts. Unambiguously anti-competitive.
Outlaw rewards credit cards? Or make it compulsory that the true cost of a specific credit card is revealed to the merchant who has the right to absorb or pass on, in a line item, that cost to that specific consumer?
If I know I'm paying for my own rewards, I'd choose a card that keeps more money in my pocket. I'd go as low as the PITA factor of cash.
It's not clear to me what the net benefit is of a credit card over a debit card.
But for sure the confusion ensuing from allowing debit cards to be charged as credit cards should be illegal. The merchant account providers are probably the ones reaping the free money on the racket.
Credit is the POS default, for whatever reason. Not all POS are the same. e.g. US Post Office consistently knows if I am using a debit card, and it prompts for a PIN when I do. Every restaurant, bar, service does not ask for PIN, and the handful of merchants I've inquired with say their debit card fees changed by the merchant account providers are the same as credit. Scammy.
At least in Colorado it's legal for businesses regardless of the TOS contract with a merchant account supplier to pass on the transaction and processing fees of credit cards. It's not legal to pass on cost/fees for debit cards, ACH, or cash.
The simple solution is the one Europe adopted: Just cap fees. We do this for Debit cards and it's fine.
>It's not clear to me what the net benefit is of a credit card over a debit card.
In a fair scheme, the net benefit to the purchaser is having a rolling line of credit for whatever they want to use that for, like managing cashflow. It's also a benefit in that it puts a behemoth with immense contractual power between you and the merchant. It doesn't matter how a merchant fucks you over, the credit card company WILL give you your money back and punish the merchant.
To the merchant, the benefits are that credit cards unlock significant consumption that humans normally would not do. It literally causes induced demand. As a consumer, you will spend more money using a credit card, and you will purchase things you otherwise wouldn't. The disconnect in your brain is known. It can also, in very specific contexts, reduce the cost of managing payments and cash. It can reduce employee theft. But this improvement is overstated.
The reason merchants put up with giving away 3% of all revenue and eating $20 per fraudulent transaction plus whatever the cost of the transaction was is entirely about the fact that a consumer using a credit card buys more than one not using a credit card. It's a big boost to your revenue.
But there is absolutely nothing about a payment network that requires such transaction fees. Certainly not "Risk", as the credit card payment network itself carries zero risk on each transaction. Every dollar fraudulently spent comes out of the pocket of merchants, not the payment network. Their only risk is consumer default, but the entire "Credit Score" system exists to nearly eliminate that risk.
The structure of the system is built to get consumers to spend more money than they normally would, and incentivize everyone to play along to get a kickback. Everything in payment infrastructure in America is designed around this. Even gift card companies are built around getting you to spend money you were not intending to and kicking a portion of that back to the brand name on the card.
I think that's out of date. He links to a study showing interchange revenue net of rewards showing up to 3% by high FICO scores. (Just at a gut check that seems crazy to me, since interchange revenue doesn't really go much above 3%!). But that's from 2013. I remember when Fidelity launched its 2% flat cashback AmEx back in 2003. People didn't really know if it would be sustainable. Now 2% is a dime a dozen.
The most recent I've seen otherwise is this Federal Reserve study[0] from 2022. It finds that the marginal return on swipes is actually slightly negative because of how juicy rewards have gotten, and 80% of their profitability comes from interest (with most of the rest fees):
> we find that, on average, the credit function makes up approximately 80 percent of the credit card profitability, whereas the contribution of the transaction function is slightly negative, as rewards and other expenses on credit card transactions outpace banks' interchange revenues.5 In addition, fees—in particular late fees—comprise approximately 15 percent of credit card profitability.
I gave up long ago trying to optimize any rewards, it just ended up being stressful and not really worth it ultimately.
Now I just use my apple card everywhere, pay it off every month and get whatever rewards I get.
It feels like a weird situation, those that stand to gain the most from credit cards are also the ones that should feel a difference of under $100 in rewards the least.
The one exception I see is bonus sign up rewards since those can be fairly significant, or making sure you use an airline card at the airline since those bonuses can be fairly significant (with sometimes other benefits). But outside of those exceptions, just choose a card with good rewards and stick with that and pay it off every month.
I gave up on optimizing and just use the Robinhood Gold 3% cashback card everywhere (except Amazon/WF, where I use their 5% Chase card). I can probably get more than 3% cashback in some categories on other cards, or more ROI by switch to points, high-tier cards like Chase Sapphire, and churning, but I just don't care.
The gain of a few thousand per annum is not worth the mental distraction.
I do the same. Just a single card for most spending, but has a bunch of handy features. I pay $50 a year for that, the convenience in case it gets stolen etc. I will say though that it's a little annoying to constantly transfer to the brokerage and then to the bank, but not too bad.
I've generally tried to stay with cash back rewards in categories that don't change, that's been the best way to balance complexity with rewards for me while not nudging me to buy stuff I don't actually need. I don't like messing with points or rotating categories or included subscriptions. With one exception I avoid annual fees as well.
So like, I have a card that's 6% on groceries, another that's 3% on gas and restaurants, Apple Card does 2% on Apple Pay transactions, and I have a 1.5% card for everything else.
> It feels like a weird situation, those that stand to gain the most from credit cards are also the ones that should feel a difference of under $100 in rewards the least.
It’s expensive to be poor. Higher interest rates, no credit card rewards, higher unit prices at places like Dollar General, etc.
I don't bother with rewards either, be it cards or memberships or whatnot - too much hassle if you're also working full time. BUT: one thing I use the credit card for and that is for the pay and travel insurance attached to it. Could I get it otherwise? Maybe, no idea. But if you don't carry debt (and I never do) there's no downside.
In the US you have several legal safeguards that are not provided by debit cards. Fraud liability limitations, chargebacks, and so on.
You can still implement “if I can’t afford something, I don’t buy it” with a cc. I pay mine off every month so it’s financially the same s a debit card but use a premium card for its purchase benefits.
I used to have this same mentality (no credit cards) when I was younger, until my debit card was stolen and someone took $1000. The bank basically shrugged their shoulders and said there was nothing they could do.
I always get my money back when this happens with a credit card purchase. I've also had to dispute things occasionally, and I almost always get refunded.
In an alternative universe, the government could require banks to refund victims of theft and fraud. It's entirely possible for banks to do this without requiring you use a credit card, they just don't want to.
> Industry body, UK Finance, estimates that criminals successfully stole £1.28 billion through banking fraud and scams in 2025. Of this, £703 million was unauthorised and £576 million was authorised.
> Unauthorised fraud is where the fraudulent transaction is carried out by a third party, not the victim. Authorised fraud involves the victim being tricked into paying money into another account that is controlled by a criminal. This is also known as Authorised Push Payment (APP) fraud.
> Frontier found that APP fraud losses have fallen by an estimated £73 million per year and the number of APP scams have fallen by nearly 35,000 due to the policy. Reimbursement rates for all claims have risen from 54% to 65%, and for claims in-scope of the policy, firms are now reimbursing 97%.
The origin of these protections in the US date back to the early decade of the general purpose credit cards. They started out for business expenses (the first one was branded “Diner’s Club”), but they were so profitable that the issuers wanted to branch out to consumers, but those were wary: many already had credit with their local merchants and didn’t see the point. (The local merchants offered credit bc women couldn’t have bank accounts).
Anyway, the credit card companies (Diner’s Club and Bank Americard, now Visa but still retaining the original color scheme and logo) lobbied Congress in the late 60s to get these protections enshrined in law so that consumers would get a benefit over using cash as a positive incentive to switch.
Yea, we never, ever use debit cards. Credit cards only, for the heightened consumer protections. It sucks that most banks and credit unions give you one by default that doubles as an ATM card. I always push back and ask if they offer an ATM card that does NOT have debit capability.
>pay mine off every month so financially the same as a debit card
actually it's better than a debit card, your purchases "float" for half a month on average you get to pay later. if you, as you should, maintain a regimen of always adding to your investment portfolio, this is a non negligible amount.
If you shop at places where many customers user credit cards, and those places don't change an extra credit card processing fee to customers, then you are effectively paying for those credit card fees whether or not you use one.
This is arguably partly because the EU caps card interchange (at 0.3%, generally). So these reward schemes don’t exist, because there’s no money for them, so why would anyone use a credit card over a debit card or bank transfer unless they need the credit? Most people in the US presumably don’t start using credit cards thinking “I’ll get in debt, that’ll be great”; it’s the reward schemes.
Ex-European here. It is very common to overdraft your bank account in Europe. The overdraft interest fees are very similar to the credit cards here in the US. It is basically the same service but with a different execution.
On a macro level, that's true. On an individual level, your avacados cost 3% more whether you use credit or debit, it's just your choice to recover 2.5% from that back in rewards or not.
>On an individual level, your avacados cost 3% more whether you use credit or debit, it's just your choice to recover 2.5% from that back in rewards or not.
I instead chose to live somewhere it's capped at 0.3% and then I don't have to fuck around to get my money back after the fact. As an added bonus, I don't even know what a medical bill looks like.
Yet many European countries have high household debt. Switzerland, Sweden, Netherlands, Denmark, some of the highest in the world. I guess it has to be mortgages, since it's true they are not that "big" on credit cards. Although Klarna is a Swedish company.
Speaking for NL, yes it's mortgages. And those come with monthly payments towards the principal in pretty much all cases. Also, those being mortgages the rates are like 5% or so, not over 20%. Soll
After 30 years, people generally speaking own their home and that's their biggest chunk of wealth. So basically, yes a high debt to income ratio, but it's building towards wealth and its not high interest debt either.
I'm American, and I don't use the extra cash flow (in fact, I make sure to keep more money in my checking account than I spend on the credit card, so I can always auto-pay my bill and therefore never pay any interest).
If I could get a debit card that gave me 2% cash back on all transactions, I'd use that instead!
Pay your credit card balance off every week, and it's an overly complicated debit card but you technically build up a score for future loans. Also maybe you get cash back on that?
Rational if you want a mortgage in the US at least.
I'm in <other US city>. It's possible to earn enough to buy property here. I already have a mortgage (as an immigrant, building a credit score from credit cards which in turn qualifies you easily for a mortgage is pretty nice).
While I hate that it's like this, you're leaving money on the table.
Currently you're keeping money in the bank accruing the bank interest to occasionally pay for stuff.
With a credit card you would get various bonuses/cashback/gameified returns by owing them money, and it costs you nothing as long as you pay them back once a month interest free.
If you however slip up/miss a payment it will cost you a lot.
Both cases suck, but the latter saves you money if you play that game.
That's from a EU perspective. From a US perspective you also require it from a credit score perspective, which EU thankfully hasn't adopted... yet.
Cashback is definitely capped, I'm less sure on other forms of rewards, but by my napkin comparisons, I do get out more "value" from my credit cards than the fees and cashback caps. YMMV of course.
Sorry, but I don't care what other people think. It's my money and I'm careful with it.
The entire credit card industry is set up to squeeze out as much profit from people as possible. They offer discounts as an incentive, but it is a huge trap that many, many people fall into. I'm not interested in risk. I'm interested in simplicity.
It's participating in the credit card industry that is foolish.
For people who only spend what they have, what is the risk? I don't accrue credit card debt, never have, so I've enjoyed a 2-3% discount on my entire spending history. Over lifetime that will probably amount to a couple of vacations.
I completely get where you're coming from, but credit cards are a tool, and you can came out way ahead using them properly. For starters, they are key to having a good credit rating, which opens a lot of doors - maintain 3 open cards, pay off the full balance every month, and keep those accounts open for 10+ years. Big lift.
Second, never use a card with an annual fee.
Third, which I already said, but bears repeating: pay off the full balance every month.
Fourth, look out for one good rewards card and funnel expenses through it, so you can get the rewards.
My parents taught me all of this 40 years ago, and it was exceptional advice, and has served me (and my family) very well.
Credit cards are not about carrying debt. They are the worst tool for that.
This is overselling it. You can come out 2% ahead or so. 4-5% if you are an extremely high spender who enjoys mentally managing 5 or 6 credit cards to max out category bonuses and other benefits and all that.
You come out marginally ahead at the expense of mental overhead. Good tradeoff for some, not for others.
I use a credit card, I dropped from 3-4 different cards trying to max out those 4-5% spending categories and just have a straight 2% cashback on everything card now. Plus one backup on a different payment network in case one goes down. It got to be exhausting trying to remember to manage so many cards plus remember to use the points, make sure to use the right card for the right thing, and all the other BS.
For some of my friends it's a hobby which is great for you if you enjoy such things! For me, it's just adding another chore to my life. Not worth the 1-2% or so marginal gain against my spending.
The super easy stuff is long gone these days too. You get far larger discounts paying via ACH for utility bills/cell phone bills/etc. vs. what credit card rewards give you so all the "autopilot" stuff is largely gone.
I do remember the days where we paid our Equinix bill via the company Amex. That was pretty fun while the party lasted!
I don't play the credit card points game. I have an Amazon Visa, and I get 5% back, which has been thousands of dollars over the life of the card. When I say that you're coming out way ahead, I'm referring to two things. One is the value you get from the points, but the other is the way credit agencies view credit accounts that are open for a decade or more and are consistently paid off. This is a strong signal to the industry that you are a person that can be relied upon to pay your debts, and this is reflected accordingly in your credit score.
Try to pay for SaaS online. Tons of them accept nothing but credit cards; and then some of them accept direct withdrawals from bank account but it takes days to verify. Services using Stripe seems to be the worst at this. (I’ve never carried a credit card balance my whole life.)
Debit cards charge as credit cards no problem. That said not having a credit card is tough on your credit history. You could just have one and pay the balance but then they still have all your data, it sucks
I’ve specifically had debit card with Visa mark declined online where credit card was expected. Don’t know how common that is because one stops doing that once it happens a couple times.
I assume you've somehow gotten access to stable housing though via that bank account (possibly a home loan, or something else), or accessed a large line of credit before 'modern' credit scoring came into play (FICO scores and the Big Three).
I see many commercials for local banking up here that pulls out 30-40+ year members of the banks boasting about the prosperity the bank provided them, but at the same time, when they'd walked into the bank back in the day A Guy just said "yeah he's good for it" and wrote out the loans they needed.
You can't opt out of the modern credit scoring system and if you fuck it up even once with a bad line item you're out of the running for quite a few things and become virtually poor.
If you are traveling and need to rent a car in the airport - sometimes it is not possible to do without credit card. Otherwise you don't need a credit card.
Using a credit card makes it way, way easier to rent a car or book a hotel room, or do other transactions that require a significant preauth.
If you present a debit card to one of those desks, they may encourage you to swap for a credit card. Because a debit preauth ties up actual funds in your account. A credit preauth costs nothing but part of your credit limit. It really is a difference if you expect to spend money on vacation.
I’ll never understand this credit card debt thing... and why should businesses eat the credit card commission cost? Is it 5%? You pay for it, why should I?
I’ve literally never bought anything with a debit card. I’ve definitely spent over a million dollars on credit cards in the last 3 decades and maybe over 2 million if you include personal and business card transactions.
Businesses accept less money when someone pays with BNPL. They also accept less money when someone pays with a credit card.
The reason is rather obvious, people spend more money with credit than they would’ve with cash. Accepting 95 cents on the dollar to get a sale with credit that you wouldn’t have got with cash still earns the seller money, money they wouldn’t have earned without accepting credit.
Vampire Squid. But this is only in one country. Go other places (e.g. New Zealand) and reality is different. There every single transaction has the credit card fee added explicitly.
The reason for a business to want to accept cards is that some fraction of your customers would choose not to buy whatever it is you sell if not for the convenience. Whether that's a guy who decides not to buy donuts because then he won't have even to buy more scratch-offs or the woman who doesn't get those bald tires replaced because if she did the family will be leaving on cheese sandwiches until payday.
For the consumer the reason is that this is revolving credit. If you pay next month you can have stuff today. That's a small relief, unless it turns into a carried balance and then it's an ongoing burden, but you don't think about that burden at first because you're naturally optimistic.
There is value in this even if you always pay your full statement balance every month.
If you have a stable source of income knowing your credit card payment is due on the 7th of every month means you don't have to monitor your checking account's balance for every purchase. You only have to think "make sure you can cover $X by the 7th".
I don't have to invest any time at all. I just use the (US) card that gives me the greatest benefits, be it cash back or services. Usually I just look at the reward rate, which is a base 2% for me right now going up to 5% for some things.
I love it. As someone who never carries a balance I get paid by banks for doing pretty much nothing at all.
And I don't worry about US retailers, I don't live there.
I should add that rewards are not the best benefits. Sign up bonuses are much more lucrative, running to hundreds of dollars per card, and can often be repeated. Same applies to bank accounts.
Imagine a world where the pipeline from extra fees back to hoop-hopping cashback didn't exist and your services were just cheaper by the same percentage points instead. It's designed to make money off people slipping up instead of serving customers.
Yes, but there are so many financial injustices and inefficiencies in the world.
And it may not work the way you expect. Retailers may favor credit card users if they tend to spend more. There are substantial costs associated with handling cash, so cash users may end up paying more.
Sure, but I'm not comparing credit cards to cash, but credit card incumbents to hypothetical lower rate ones that don't offer rewards in exchange for risk and busywork.
Incorrect. I am paid by the banks, I have no financial relationship with other customers.
But of course banks make huge amounts of money from poor customers via various fees and interest payments. It warms my heart that I get some of those ill gotten gains insead of the evil banks.
In order for the banks to retain the market power required to keep such high interchange fees in place the need to incentivise those who don't NEED to pay with a credit card to do so anyway, and the biggest way they do this is by splitting the loot with you. You share in the loot, and you share in the responsibility for how it was accumulated.
Assuming you have sufficient income, paying your balance off in full every month and instantly redeeming the rewards each month doesn’t take a whole lot of time. I just use a card that gives 1.5% cash back.
Agreed. I have my rewards configured to automatically convert to cash to reduce my bill. The button was buried deep in the website, but once I found it, I've never had to go back to the rewards site again.
Credit isn't negative sum, it is a positive sum game. "Negative sum" has a specific meaning here and just because wealth is being transferred isn't that significant; positive sum games also have wealth transfers.
It is risky and it is very easy to lose great amounts of money on a bad decision when credit is involved. Arguably that makes it bad. But still not negative sum.
Alternatively CC companies could cut off people over certain credit risk and then be able to charge interest in line with the lower overall credit risk…
Borrowers can also keep from overextending their credit and go on debit cards instead…
Obviously these things can have an impact on people but before the 80s credit cards were not widely available to people with high credit risk and the world still functioned.
Why is it so hard lol? I have the Bank of America Rewards card for 25+ years. 2.62% cashback on everything, 3.5% on dining/travel. Maybe there are better ones out there but this is good. I have auto-pay setup so I don't have to worry. I have not spent a second of my time optimizing anything in last 15 years
I don’t have any data, but my intuition is that overall high-fee, high-reward cards increase propensity for consumer spending by at least a few % beyond the fees/rewards.
The merchants think so, too, or they wouldn’t accept the processors that let their banks hand out these cards.
> The merchants think so, too, or they wouldn’t accept the processors that let their banks hand out these cards.
Visa / Mastercard / American Express all have lines of premium credit cards (Visa Infinite, World Elite Mastercard, Amex Platinum), and they're very much too big to ban. You'd just be left with one processor in the US (Discover, now owned by Capital One).
This is wrong. Merchants can elect to only accept debit cards.
In recent years, all of my utilities have added 3%+ credit card surcharges, so I pay most of my household expenses with debit cards/ACH now.
Tmobile, Comcast, Verizon, ATT, Target, grocery store, electric utility and water utility (government), annual vehicle tax (government), auto body shop, daycare, and any home repair contractors all charge 3%+ (or give a discount, same thing), so I basically only use credit cards for other retail stores and travel and restaurants.
The point is they make a lot of their money from people who don't, paying 20% APR -- the 'whales' in this consumer industry aren't the richest people, unlike retail, gaming, travel, etc.
Understand what? I'm responding to your claim as written in the context of the comment you replied to. Your current reply is just as vague and light on details so not sure what you were expecting.
Rewards are paid out for transactions, not interest paid, that's all. Otherwise poor people failing payments would get more rewards than the rich which don't. The dynamics would be completely different.
There is literally no time involved in avoiding interest. You pay your complete balance when it's due. As far as rewards go, I can't be bothered with them so I always just opt for cash back which I do maybe twice a year. Time involved: 5 minutes / 6 mo.
There's plenty of time: the time you waste by not spending money you don't have. You have to wait longer until you make more money in order to spend more without interest.
Don't spend money you don't have. Especially don't do it with 20% interest short-term loans. It's not that hard. If you're not financially responsible enough to handle a credit card, do not get one. I didn't have one until my late 20s.
That is a spurious argument. You have a choice in whether you pay interest, you do not have a choice about a purchase including the cost of paying payment processor fees since the price is the same if you use paper money.
One of the most corrupting yet hidden forces in America today are the payment networks MC/Visa etc. due to their bribing and corruption of the government in order to prevent things like making payment processor fees separate/independent of the cost, i.e., similar to how taxes are added after the fact, not included in the price; and also preventing merchants from having two different prices, cash vs card.
I’m a bit surprised that HBR does not seem to even really have an accurate mental model if the matter, unless they’re making an editorial choice to speak in vernacular turns to relate it to the audience.
The problem is not really the cards, it even credit cards, it’s actually the payment processing networks that are the corrupting force.
If America has a legitimate government, there would have been a federal alternative payment processor that charges nothing as an accompaniment and based on the authority to mint the currency, which is what a payment processor today is, a digital currency mint.
To put it into perspective, when you purchase something by credit card, a merchant may have to l pay a little under 3% on a $100 purchase. When you purchase something cheaper let’s say $5, a merchant may pay 6.5%. And no, they don’t just say “awe shucks, I guess I’ll lose that money”, They increase the prices by some averaged amount.
Some may say that they can’t do that because competition, well, because there is no real competition and because the payment processor de facto monopoly/cartel has basically every single company in lockdown and you have no real alternatives, especially in places like Europe where they’ve foolishly and enthusiastically started forcing everyone into digital payment, all the merchants simply roll what is effectively a kind of organized crime/mob extortion into the prices of the goods and services the common person pays and never knows is paying.
That is not a positive. I'm fine with splitting up a price if you want to show how much tax gets added, but having to continuously do the mental math of "no this item is 10.99 it's 10.99 + tax" is very frustrating. When I pick up a $11 item, I want to spend $11.
I get your point, it's the argument of the disengaged pseudo-citizen that just doesn't want their convenience bothered. We have those here too even though it's a bit different here. A good case could be made for cash payments receiving a discount, i.e., less the payment processor fee. You may not pay $11 when you pick up a $11 item that way either, but it might place you to never know by how much it will be that way, i.e., maybe $10.75 instead.
I would even advocate that in the US we require taxation to be handled that way too because you are right, most of our citizens can't do basic math, let alone in their heads, or even really care; but if the price tag had to be the taxed price and you then get a discount if you pay cash, it would be a far better situation. There has never been a better time to do this with digital price tags.
The inherent problem is that the likes of the masses are hard to organize, let alone corral and focus on a single thing and everyone thinks they are smarter than the average.
That does not apply universally and it mostly for various domestic payment processors of the very kind that should have also been implemented in the USA a long time ago, if the US government weren't so dark rotten and corrupt and had actually been responsive or even just representative of the people for the last 150 or so years.
It applies to all card networks (ie Visa and Mastercard, and local schemes like Girocard and Cartes Bancaires, though in practice most local schemes had cheaper-than-cap fees anyway), for consumer cards only. About the only significant thing it does _not_ apply to is Amex, but in practice that's only issued in a couple of EU countries these days, and is not widely accepted.
I also attempted to do real-time audio visualizations with LED strips. What was unsatisfying is that the net effect always seemed to be: the thing would light up with heavy beats and general volume. But otherwise the visual didn't FEEL like the music. This is the same issue I always had with the Winamp visualizations back in the day.
To solve this I tried pre-processing the audio, which only works with recordings obviously. I extract the beats and the chords (using Chordify). I made a basic animation and pulsed the lights to the beat, and mapped the chords to different color palettes.
Some friends and I rushed it to put it together as a Burning Man art project and it wasn't perfect, but by the time we launched it felt a lot closer to what I'd imagined. Here's a grainy video of it working at Burning Man: https://www.youtube.com/watch?v=sXVZhv_Xi0I
It works pretty well with most songs that you pick. Just saying there's another way to go somewhere between (1) fully reactive to live audio, and (2) hand designed animations.
I don't think there's an easy bridge to make it work with live audio though unfortunately.
Agreed. As engineers we build context every time we interact with the codebase. LLMs don't do that.
A good senior engineer has a ton in their head after 6+ months in a codebase. You can spend a lot of time trying to equip Claude Code with the equivalent in the form of CLAUDE.MD, references to docs, etc., but it's a lot of work, and it's not clear that the agents even use it well (yet).
Another factor with the vibes being off (at least in the US): mass outsourcing of jobs thanks to remote work. You used to have to be a multinational company with global entities and offices. Now you can be a 10-person startup with half your people outside the country.
When the world went remote many folks were happy with the better work-life balance. But it means that we compete in a ruthless global labor market.
That's why companies rejecting remote work is good for the American worker in some ways.
"remote" can just mean "far enough from the financial district that I can afford a little space" as it turns out. You're not WRONG but just being in the same time zone as your coworkers gets you 90% of the in person benefits and, realistically, it's too hard to work with a team that is on a vastly different tz.
Local can still be better than global while still allowing people to work from home and convene in meat space as needed
> companies rejecting remote work is good for the American worker
It's good for American real estate owners, who end up with more money as a result of this, both from offices and from staff who have to live in nearby high COL areas.
I believe an important reason for why there are no LLM breakthroughs is that humans make progress in their thinking through experimentation, i.e. collecting targeted data, which requires exerting agency on the real world. This isn't just observation, it's the creation of data not already in the training set.
Maybe also the fact that they can't learn small pieces of new information without "formatting" its whole brain again, from scratch. And fine tuning is like having a stroke, where you get specialization by losing cognitive capabilities.
Data labeling has been moving to onshore / higher paid work. There's still a lot offshore, but for LLMs in particular and various specialized models, there's a massive trend toward hiring highly educated, highly paid specialists in the US.
But as other commenters have warned: beware of labor laws, especially in CA/NY/MA.
I've had a front-row seat to this...our company hires + employs contract W2 and 1099 workers for the tech industry. Two years ago we started to get a ton of demand from data labeling companies and more recently foundation model cos who are doing DIY data labeling. Companies are converting 1099 workforces to W2 to avoid misclassification. Or they're trying to button up their use of 1099 to avoid being offside.
I do agree. But the thing I would add though is that at least when I was there (W2012 - we were in the same batch!) YC and PG in particular were vocal about principles they believed in, especially the idea that naive young founders get kicked around in Silicon Valley and ought to be treated fairly. PG talked about this constantly and of course it’s a big theme of his essays. I remember one particular instance where a potential investor was behaving questionably and PG offered to step in and talk to them if they crossed a certain line (which they did not in the end). He was clear about what he concerned acceptable and unacceptable and why. And we were nowhere near the cool end of the batch.
Yes YC acts in its interests but in my experience they live by good principles and that makes all the difference. The Chaos Monkeys anecdote is an example of that. So I don’t agree with the article’s framing that they throw their weight around to simply exercise whatever power they have over others for financial gain.
reply