Write-Offs: 08.19.13
$$$Obama Focuses on Risk of New Bubble Undermining Broad Recovery [Bloomberg]
$$$Warren Buffett thanks BofA CEO Moynihan for $5.3 billion profit [CNBC]
$$$J.P. Morgan Faces New Probe on Energy Trades [WSJ]
$$$Bat Maker Hopes New Bank Sparks a Rally [WSJ]
$$$Setting lobster prices is not, in other words, a matter of just adding a markup to costs. It’s a surprisingly complex attempt to both respond to and shape what customers want. The key, though, is that restaurants are able to adopt such strategies only because the restaurant business is not, at heart, a commodity market. Gas stations can try all sorts of approaches to bring customers in, but the retail price for gasoline rises and falls in line with supply costs, because gas is gas, and if you charge too much for it people will go to your competitor down the street. In the case of restaurants, there’s lots of competition, but there are few customers who are making decisions about where to go based solely on the price of lobster. And restaurants, obviously, can add value to the lobster they serve with unique recipes, décor, dockside location, and so on. They’re still in a very tough business, but at least they have some way of differentiating themselves, and some measure of pricing power. Commodity producers, by contrast, can make lots of money if the conditions are right, but their fate ultimately depends on the broader economy. Restaurants are trying to insulate themselves from the market; lobstermen are at the mercy of it. [New Yorker]
$$$As Investors Jump Ship, SAC Looks to Cut Back [Dealbook]
$$$Man Ends Up with Fork Stuck in Penis After 'Unusual' Autoerotic Act [Gawker]
