rachel2w1w: Making Money on Internet

So, why did this particular ad hit a nerve with the online audience, and what was Target really going for?

I think that the internet DIY set reacted to making fun of a costume that fits their ethos perfectly. Last halloween, for example, one DIY dad became a YouTube hit when he posted an awesome homemade Iron Man costume he made for his kid. Is Target's message really that the kid would have been better off wearing a storebought version? If so, citizens of the internet (and makers in particular) are right to be a little ticked off.

As for the non-DIYers, I think that what made them upset was the way Target tried to manipulate kids by playing the dual role of the bully who makes fun of your costume and the cool parent who just wants to help you fit in, unlike your weird, lame, Iron-Man-suit-building mom.

That doesn't work, though, because the parents who will be paying for the costumes are the ones who teach their kids that bullying and peer pressure are wrong, and that creativity is good. The bigger, more popular kid who mocks your costume is the bad guy in every cartoon and after-school special. Why would any kid root for him? And why would parents root against their own nostalgia for (sometimes embarrassing) homemade Halloween outfits? (And if this ad was made to be seen by kids, it sure was shot poorly.)

That leads me to a distasteful theory about who Target was, well, targeting with this commercial. It's not aimed at internet geeks with the time, money and technical skills to make amazing Iron Man costumes for their kids. They aren't going to go to Target for a costume anyway. It's aimed at parents who don't have that time, money or expertise, and who don't want their kids to be singled out as weird or poor. Did Target pick a black family for the ad because they think African-American parents fit that profile? That would be the grossest type of marketing, but I think it's possible.

It doesn't matter if you can't make (or afford to make) your kid a costume, though: the ad still fails because the homemade costume it shows is cool. That mom did a great job with it, and clearly put in some time and effort, so there's nothing for her kid to be embarrassed about. If Target wanted to invoke shame and peer-pressure to make parents feel self-conscious about their income or costume-making skills, they should have at least shown a costume that was actually bad.

Next time you hear an economist or denizen of Wall Street talk about how the "American economy" is doing these days, watch your wallet.

There are two American economies. One is on the mend. The other is still coming apart.

The one that's mending is America's Big Money economy. It's comprised of Wall Street traders, big investors, and top professionals and corporate executives.

The Big Money economy is doing well these days. That's partly thanks to Ben Bernanke, whose Fed is keeping interest rates near zero by printing money as fast as it dare. It's essentially free money to America's Big Money economy.

Free money can almost always be put to uses that create more of it. Big corporations are buying back their shares of stock, thereby boosting corporate earnings. They're merging and acquiring other companies.

And they're going abroad in search of customers.

Thanks to fast-growing China, India, and Brazil, giant American corporations are racking up sales. They're selling Asian and Latin American consumers everything from cars and cell phones to fancy Internet software and iPads. Forty percent of the S&P 500 biggest corporations are now doing more than 60 percent of their business abroad. And America's biggest investors are also going abroad to get a nice return on their money.

So don't worry about America's Big Money economy. According to a Wall Street Journal survey released Thursday, overall compensation in financial services will rise 5 percent this year, and employees in some businesses like asset management will get increases of 15 percent.

The Dow Jones Industrial Average is back to where it was before the Lehman bankruptcy filing triggered the financial collapse. And profits at America's largest corporations are heading upward.

But there's another American economy, and it's not on the mend. Call it the Average Worker economy.

Last Friday's jobs report showed 159,000 new private-sector jobs in October. That's better than previous months. But 125,000 net new jobs are needed just to keep up with the growth of the American labor force. So another way of expressing what happened to jobs in October is to say 24,000 were added over what we need just to stay even.

Yet the American economy has lost 15 million jobs since the start of the Great Recession. And if you add in the growth of the labor force -- including everyone too discouraged to look for a job -- we're down about 22 million.

Or to put it another way, we're still getting nowhere on jobs.

One out of eight breadwinners is still out of work. Most families in the Average Worker economy rely on two breadwinners. So if one out of eight isn't working, chances are high that family incomes are down compared to what they were three years ago.

And that means the bills aren't getting paid.

According to a recent Washington Post poll, more than half of all Americans -- 53 percent -- are worried about making their mortgage payments. This is many more than were worried two years ago, when the Great Recession hit bottom. Then, 37 percent expressed worry.

Delinquency rates on home loans are rising. Distressed sales are up as a percent of total sales.

Most people in the Average Worker economy own few shares of stock, if any. Their equity is in their homes. But with all the delinquencies and distressed sales, the housing market has a glut of homes for sale. As a result, home prices are still dropping. So the net worth of most Americans is still dropping.

And even though interest rates are falling, most people in the Average Worker economy can't refinance their homes. They can't get home equity loans. Banks don't want to lend to the Average Worker economy because people in it are considered bad credit risks. They still owe lots of money, their family incomes are down, and their net worth has fallen.

And according to the Reuters/University of Michigan survey of American consumers, expectations about personal finances are at an all time low.

Inhabitants of the Big Money economy are celebrating Republican wins last week. They figure financial regulations will be rolled back, environmental regulations will be canned, the Bush tax cut will be extended to the top 1 percent, and it will be harder for workers to form unions.

Inhabitants of the Average Worker economy aren't so sure. The economy has been so bad they're angry at politicians. They showed their anger at the ballot box. They took it out on incumbents.

But if nothing changes in the Average Worker economy, there will be hell to pay.

Robert Reich is the author of Aftershock: The Next Economy and America's Future, now in bookstores. This post originally appeared at RobertReich.org.

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Monday, November 15, 2010

Making Money on Internet

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