2007-10-24

The Hot Crazy Line

Where are you with relation to the Vicki Mendoza diagonal? Barney's comments are very sexist, so I'd like to point out that the hot/crazy line applies to both sexes equally, though for men, it's more of a money vs "funny looking" line. In other words, the funnier you look, the more earning potential is required.

In a similar vein, have you heard about the woman who advertised her self-described beautiful self on Craigslist suggesting that only men earning over $500,000 need apply? Well, some hedge fund honcho replied to her with a little lesson in economics (edited a little, because apparently Mr. Half-Million didn't have his secretary write the post):

"Here's the rub: your looks will fade, but my money will likely continue in perpetuity … in fact, it is very likely that my income will increase, but it is an absolute certainty that you won't be getting any more beautiful...

So, in economic terms, you are a depreciating asset, and I am an earning asset. Not only are you a depreciating asset, but your depreciation accelerates. Let me explain: you're 25 now and will likely stay pretty hot for the next 5 years, but less so each year. Then the fade begins in earnest. By 35 it's over.

So in Wall Street terms, we would call you a trading position, not a buy and hold... if you want to enter into some sort of short term lease, let me know."


As for me, I'm more in the market for a lease with an option to buy. Eternal amortization is okay with me.