Googles’ shares are sold at 675.15 $ (state of October 29th). This company has started from producing virtual product, which still generates majority of its’ profit.

Facebook is similar. Even though its’ IPO failed dramatically company is still in good shape. Its debts to assets ratio is quite low, making Facebook almost impossible to bankrupt.

Neither of these companies earned their fortune on producing and selling physical goods. However both eventually got there. Or close. Googles’ Android system is now installed on majority of smartphones and Facebook is now delivering gifts.

I would like to comment of this sudden “shift” to physical reality. More and more users are now using FB through their phones, which doesnt allow for advertisements to show (primary source of websites income). Thus firms profits were falling. Possibly, such “extention” to the physical world is just a way to protect the company? Virtual products are fairly new in this world, whilst physical products have a long story (the story starts deep in times, when barter trade appeared).

So is this a way to protect the company, or is Facebook just trying to satisfy its users?

In one of our Comm 101 tutorials we had a debate about whether its worth going to MBA straight after bachelors degree or not. The opinions split. One thinks that MBA gives that valuavle networking bonus. Other thinks that you would gain the same advantage by actually working. Moreover, you will get paid for this, not wise verca.

But are business schools actually doing enough for growing aware leaders, not just effective professionals that will sacrifice morals for outcome?

Gianpiero Petriglieri in his HBR blog raises that question ones more. It appears, that for the past decades social responsibility was not one of the B-school graduates’ topics.
“Most business schools have introduced mandatory ethics courses and revamped curricula to incorporate concerns about personal principles and social responsibility. But is that enough?”
(http://blogs.hbr.org/cs/2012/11/are_business_schools_clueless.html)

However, author believes that business schools can be the source of ethics awaraness in future leaders, and are in fact striving to do so. They are in “transition”, meaning the ways of teaching ethics are still to be perfected. Though institutions are on the right track.

I do realize most of my classmates are what we call “aware”, and ready to be socially responsible. But that is the view inside of comfortable box. When we are all out to the real world, words “ethics” and “responsibility” may and most likely will fade away, to be replaced by $.

Can we make teaching ethics in business school more effective?

I would suggest having mandatory projects, which studetns have to lead/participate in, that deal with real life hardships of people around.

Seeing people in harship yourself is much different to studying people in hardship sitting in the warm classrom after big fat lunch.

http://1.bp.blogspot.com/-Bl48ROagJqg/TVOw5u0XOwI/AAAAAAAABlI/sdhlKXs4Zw8/s1600/forex-leverage-margin.jpg

This march I decided to play  a bit in “investment game”. As a practice, and possible source of profit, I started looking for the way to invest those 200$ that were still in my pocket after salary day in february. However it appeared, that my options are quite limited.

Hedge funds and investment banks all required much more funds starts (minimal investments starting at 10 000$) than I ever held in my hands. Depositing those money in bank also didnt seem too time effective (with interest of 5% a year…for 200$….). One of my friends was trading forex at time, so I decided to start up a demo account on one of the brokers sites. However in few days I realized that everything is much more complicated and much more times is needed to master the main principles of forex trade.

At last, I found a way to invest money. My choice fell on PAMM accounts- basically numerous micro investors giving a trader funds to trade. Out of profit the traders takes from 5 to 40%, depending on traders offer. This platform is interesting for investment, as in highly volatile market of currency, 100% profits in a month are not that uncommon. Even with ~20% paid to traiders- this is a high percent.

After 3 months of this experiment, my final balance was 250$, 50 of them being pure profit. During these 3 months I invested different sums in around 20 traders, all having different trading styles (scalping trade, careful trade etc).

50$ is 20% increase in funds in 3 months. This is around 7% a month- way more than any bank deposit could offer.

Would you consider PAMM as a savvy investment, or would you not go an invest into such an unpredictable and volatile market?

This blog deals with enterpreneurs spirit.

Nowadays a lot of western businesses pay close attention to the underdeveloped countries in Africa, Asia etc. Many of countries in that regions regularly receive medical and humanitarian help from “Big Brothers”. However one may easily argue, that those donations are only hurting the economies of those countries.

When a human is given something for free (humanitarian help, for example), with time it appears to be taken for granted. People lose inititive, enterpreneurial spirit.

Such sites as http://www.kiva.org/ work differently. They offer each one of us to help. Though not in a traditional way of “collecting money for poor children of country N”. On this website each one donate 25$. All the money donated then constitute basic capital, that is then invested in local business. This creates working places, starts feeding this country.

I doubt that sole donation of food/money/help can help the country (only short-term). For country to be prosperous, investment has to be done, especially at the very low level.

Update, November 15th:

Today we had professor Jor Croecker at our class talking about ARC initiative. This lecture made me rethink some of the statements I made earlier. Is help that inneficient? It appears that ARC team has actually helped many people to achieve more in their enterpreneurial strivings. Though still this was not just a charity. They taught BUSINESS to future/actual BUSINESSMEN, that are to create workplaces and stimulate their countries’ economies

http://www.kickstarter.com/. Thousand dollars invested in works of art, videos, book publising. Millions- in games, major movies. Thousands of small investors, expecting virtually nothing as a payback.
This is crowdfunding.

The concept is easy and clear- persons announces the idea, presents it on the webpage. After that, people decide, whether to give money to this project. Sure, each projects has “perks”, that encourage donator to choose “this our very special something”.

The most interesting fact is that neither of these contributors receives any profit from such investment. Just thousand of people helping each other.

How does crowdfund works? Company (Kickstarters) simply takes around 10% from each donation.

This is a wonderful business model, where the costs are low (as it is, company only provides a platform for exhibiting projects), and profits are high- some projects add up to several million dollars in donations, making it around 100 000 profit for the company for 1 project. And there are few dozen fundraisers running on the website at a time.

Fundraising, as appears, may become a base for profitable and ethical business, as it helps people to achieve their goals and dreams (creates positive values) and receives profit for it (does what business is there for).

picture from: http://upload.wikimedia.org/wikipedia/commons/6/6f/Bread_in_Boudin.jpg

http://en.rian.ru/business/20120808/175068345.html
“Russian bread prices may rise 5-10 percent in the fall in the wake of rising grain prices driven by drought in some of Russian regions”.

This article brings up an issue of bread prices rising in Russia due to unsuccessful yield of crops this year. Higher cost force the producer to rise the prices.

So should the main supplies, like water, gas, bread, in this case- correspond to the real market price? Should government subsidise those, or just set a price cap?

This question is a wide field for debate which eventually hits a question of whether or not should the firm only care about profit maximization no matter what cost?

Possible solutions? Id say “per need” system could work. The idea is to sell the product cheaper (possibly with zero or minial profit) to those, who posses certain kind of “in need” identification. This easens burden for firm (no ethical problems) and for government (no need to subsidise whole industry, just a part of it).

But there is an option, when firm would not want to pay any “moral” debt to society it operates in. What than? In that case, such institutions as governments still exist…

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