Random Thoughts – Randocity!

Should we believe social media influencers?

Posted in advice, Google, scams, youtube by commorancy on May 14, 2019

There are many, many YouTubers (and Instagramers) who claim to profess knowledge of a given topic. By far, a vast majority are in the beauty industry. After all, beauty sells. Unfortunately, while they may be pretty, many have few brain cells in their heads. Let’s explore.

Social Media Sites: YouTube and Instagram

With the advent of social media sites, many young people have rabidly jumped on board to create content for these platforms. Some of these people (dare I say ‘kids’) have chosen to specialize in specific areas, like beauty products. I’ll focus on these ‘influencers’ in this article. Can these (or any) ‘influencers’ be trusted?

The short answer to this question is, no. These are young people (many aged between 18 and 21) who have acquired just enough knowledge to be dangerous. Yet, they in no way should be considered “professional”, let alone “knowledgeable”. I won’t name any names here. Even if I wanted to name names, there are actually far too many of these types of beauty channels to even point out a single one. Suffice it to say, there are many, many far too young beauty advocates on YouTube who may already have money, a palette of makeup and very strong opinions, yet actually have no skill or talent at all. Instead, with their limited talent at applying makeup, they have managed to amass a large following of young followers. Some have gained enough followers that they have been able to get product endorsements, sponsorships, monetization or have been approached to create product lines. Gaining followers is actually what they are good at, not applying the makeup, not creating the hairstyles, not selling makeup brushes.

In fact, many of their ideas can be downright dangerous. What they are actually good at is…

Hawking Products

And… that’s not a reason to celebrate or follow anyone. As these “kids” become “personalities” on screen, what you’re buying into isn’t the their products, but their drama. Watching an 18 year old drag queen apply makeup like a pro may seem enthralling, but the reality is you have no idea how many times that person may have applied it until they got the application just perfect. Maybe they even hired someone to apply it on them pretending as though they applied it. As we all know, “Practice Makes Perfect.” No where is this concept more important than on YouTube. Yet, fakery is everywhere, even in these beauty videos.

YouTube videos make the application of beauty products seem like a breeze. What you aren’t seeing is all of days worth of practice and product testing that the YouTube “personality” (and I use that term very loosely) endured to make that video appear perfect. Even then, give them a few months and they couldn’t even reproduce that look, if they even produced it the first time. Who knows if they even really applied the makeup themselves?

Unfortunately, the goal of being a celebrity is the want of money. In fact, many YouTuber’s goals are to make money from the platform. That’s their #1 goal. It’s not about you, the viewer. It is about you, the consumer funneling money into their channel (and eventually into their products). Whether that money is via clicking advertisements or via Patreon or buying into their sponsored products.

This is why the once “down to earth” YouTuber turns into a flamboyant, loud, arrogant, controversial dramatic personality trying to get you to buy the latest Morphe brush set that you don’t really need. It’s about making THEM money and parting you from yours. It’s not about reality, it’s about sales and fakery.

Drama Advertising

YouTube drama and scandals are quite commonplace in the YouTube beauty arena. On the one hand you have a seeming drag queen who’s boisterous, loud and obnoxious. On the other, you have another large personality who feels they are also entitled. When the two clash, it becomes a huge social media blow up. It ends up all over Twitter, Facebook, Instagram and, yes, YouTube.

The scandal and drama fuels their channels with tons of new subscribers, viewers and brings their brand front and center. Effectively, it’s ‘dramadvertising’. The question is, is whether all of that drama is …

Fake

One of the problems with YouTube is that so much of what you see is fake. With perfect cuts between takes, filters, expensive lighting and cameras and, yes, even the perfect application of makeup, the camera can make someone appear flawless.

With the makeup (or more specifically, fakeup), when you turn the ring lights off and take that person out into natural lighting, not only will the makeup application look like crap, you’ll be able to see very crease, flaw and imperfection in the application. Even then, the makeup is so overbearing, you wouldn’t really want to wear it anyway. With the right lighting and cameras, you can hide just about any imperfection. With the wrong lighting, let’s just say that the personality is an amateur.

Additionally, much of the drama that shows up on YouTube is entirely fake and is staged as a publicity stunt. Just like YouTube celebs sometimes have seeming congenial collabs with one another, they can also script scandals in the same way. It’s so easy for two personalities to meet and agree (to publicly disagree), to make a scene on social media designed to get their channels more viewers, more divisive comments and basically stir the pot. Sometimes stirring the pot is the only way to gain more viewers.

Several large beauty personalities have tried this approach in the recent past. Again, I won’t name names as they don’t deserve to be named on Randocity. I won’t give them the satisfaction of increasing their channel’s membership at the cost of my time spent writing this article. No. If you want to find those scandals from the recent past, you’ll need to head on over to Google and do some searching.

Knowledge, Age and Acting

I’m not going to say there aren’t prodigies in this world. There are. Unfortunately, none of them are on YouTube hawking beauty products. What you see on YouTube is random, usually “pretty” young guys and girls who have gained a following because of their seeming talents. Oh, they have a talent, but it’s not teaching you beauty techniques. Oh, no no. The talent they have is parting you from your money and being a general scam artist.

At 19, I didn’t have enough knowledge enough in any subject to be considered “professional” at anything. These same aged personalities on YouTube are also in this same boat. If they have any knowledge, it’s likely because they paid for it by hiring someone to show it to them, or more likely, do it for them. That’s not knowledge acquisition, that’s acting… and not even very good acting at that.

In fact, anyone on YouTube who has a channel is acting. Some of that acting is, in general, for the betterment of the viewers by showing the viewers something interesting. This should be considered entertainment, not advice.

While I can buy into an actor on stage telling me a story, I can’t buy into an actor behind a camera trying to sell me Morphe brushes. This was tried in the 90s via many, many…

Infomercials

Before YouTube became a thing, infomercials ruled. The talent that might have jumped in front of a camera for YouTube instead did so for Guthy Renker or other similar production companies. These companies have hawked all sorts of garbage throughout the 90s and 00s on late night TV.

These things including psychic readings, beauty products, acne products, hair care products, kitchen gadgets and even money making books. The array of crap advertised on infomercials is as varied as it is endless. Thankfully, infomercials were typically one-and-done. Meaning, only one infomercial was ever produced and when its run finally ran out months (or years later), the product disappeared from the airwaves.

YouTube

With YouTube, we now have a situation where the same crap that was hawked via late night infomercials has moved to YouTube as a daily, biweekly or weekly “show” (again, I use this term loosely). Because many of these personalities produce their own material, the structure of the video is random and chaotic. The one thing that isn’t random is their want for money.

Worse, viewers seem to buy into this random chaos from a random “young” person. It makes them see more “real”. Don’t kid yourself, there’s nothing at all real about a guy dressing up in drag for a camera. That’s a show.

In all likelihood, when that “kid” gets home, the makeup, nails and hair all goes away and they go back to being average kid living with their parents. It’s all for the camera.

This is the fallacy of YouTube. It’s not real. It’s not genuine. It’s not even accurate. It’s fakery and deception at its finest. The “Hi Guys… I appreciate you so, so much” is so disingenuous, it makes me want to gag. I can’t even count the number of times I’ve heard a similar phrase from a YouTuber. It’s all superficial and fake. Many of these kids turned personalities are likely even mentally disturbed. Yet, they can somehow compose themselves enough in front of a camera to appear ‘sane’ and ‘normal’. These are people who are not and should never be role models, let alone ever consider befriending in real life.

Yet, companies like Morphe extend sponsorships to these damaged folks, not because they’re good role models, but because they have 1 million or more YouTube subscribers… in other words, for all of the wrong reasons.

What is your damage?

An age old question, but very applicable to many YouTube personalities. Far too many of them, in fact. I simply do not feel comfortable taking advice from someone I don’t know, let alone from a drag queen whose claim to fame is putting on flawless makeup using a social platform without any formal training. Really? You expect me to believe what you have to say simply because you’re “famous” or because you look like you know what you’re doing? No.

YouTube Fame

Many YouTubers seem to think that being famous on YouTube actually means something. It doesn’t. If you want to be famous, and I mean seriously famous, you train to become an actor and you get hired in a blockbuster a film or highly rated TV series… then put on a performance that wins awards. That’s fame. And, that’s fame for all the “right” reasons… including displaying actual talent.

Being on YouTube because you can run a camera isn’t fame. It isn’t even celebrity. If anything it’s considered being a “minor” celebrity… and that’s being extremely generous. Being on YouTube doesn’t require skill, it only requires a camera, an idea and your opinions. Again, I won’t name any channels because the point of this article isn’t to send you off to a YouTube channel to become a subscriber, it’s to point out the problems with YouTube as a platform… and where YouTube stands today.

It’s called YouTube with a YOU

There’s a ‘YOU’ in the name. Which means, it’s about you. The real you. Not about a sponsor. Not about your cat. Not about makeup. Not about advertising. It’s about YOU. I think the platform has lost its reason why it came to be. When YouTube became about making money and lost actually being about ‘YOU’, then it became yet another lame commercial platform to sell stuff. And, that’s exactly what it’s become. One big advertising platform… from the embedded ads in the videos to the ads served up verbally in the videos by the creators.

In fact, it should probably be renamed ‘AdTube’ as that’s what it has become. It’s not about the ‘YOU’, it’s about the ‘advertising’, making money and selling you, the viewer, something, anything.

I used to go to YouTube to find interesting people doing interesting things. To find funny, amateur videos. Today, it’s about selling you something and making the creator money. When I go into a video and within 1-3 minutes a strategic product placement appears, I click away. Too many videos are now following this format.

With YouTube’s crackdown on monetization, that’s making even the biggest channels less and less money. I’m all for that. If YouTube turned off monetization tomorrow, it wouldn’t make many creators happy, but it would bring the platform back to its roots… the reason the ‘YOU’ in YouTube exists.

YouTube should move the the highly commercial channels into a new network called AdTube. Get them off the YouTube platform and let YouTube go back to its roots. Turn AdTube into the network that allows these highly commercial, highly sponsored, advertising heavy videos (and channels) to operate. YouTube doesn’t need these. In fact, because YouTube has basically degraded so badly, it’s really just a matter of time before the platform ultimately implodes under its own weight and stigma. Google needs to make a choice and they need to make it fast.

Making Choices

We, as consumers, need to wake up and stop following (and buying stuff from) brainless YouTubers who have no skills or talents other than holding a camera. You have a choice to watch or click away. You don’t even have to visit YouTube. Use your own critical thinking and stop watching channels that have 5, 10, 15 ads along with paid sponsorships in the video. That’s not what YouTube is about, that’s what both YouTube and Instagram have become.

You don’t have to watch this drivel. You have choices. Turn it off and spend time doing something creative or with your friends or family. Learn something… like how to draw or paint or play a guitar. Pick up something that you can do and learn to do it. You don’t need to watch someone on YouTube to be creative. In fact, watching YouTube does the opposite of making you creative. It robs you of precious time that you could be learning a skill, craft or how to play music. Spend that time bettering yourself rather than giving your money to someone and wishing you could be like them.

In fact, you don’t want to be like them. They may appear wholesome and friendly on YouTube, but chances are they are far, far different from what they portray themselves to be. As I said, they’re actors putting on a character. It’s not real. It’s not genuine. It’s a character designed to rope you in and have you spend money on them.

Authentic YouTubers

Just to clarify, this article is not intending to rail against every YouTuber. I’m specifically calling out the big 1, 2, 10 and 50 million subscriber channels playing every trick in the book to get you to spend money. And more specifically, this article is aimed squarely at the beauty industry channels. These very large, seemingly successful channels are solely about one thing. Getting you to buy something. Chances are, if you do buy that something, that channel stands to make a hefty cut of the profits and you’re left with a mediocre product you likely can’t return and may not even be able to use.

If you want to buy products, do it at a store. Try the product out and then decide if you want it. Use your OWN judgement to see if it works for you. Don’t believe the hype a beauty channel spouts. Believe what you see in person… at a store.

I’m not at all saying not to watch YouTube or even Instagram with the right frame of mind. Consider all social media channels as strictly entertainment. If it makes you laugh or gives you some other emotional response, great. But, don’t get invested in the channel as if it were real or believable or even an authority. It’s none of that. It’s simply entertainment, plain and simple. In fact, this part applies to ANY YouTube channel. They’re all simply entertainment with fallible and inaccurate information offered in video form, even with the most well meaning of intentions. As the saying goes, “Take it with a grain of salt.” Which ultimately means, disregard the information as inaccurate and only watch as you would pure fictional entertainment. If the video content peaks your interest, go Google the topic and find out more from reputable sources.

From this perspective, YouTube is fine to watch… but don’t invest money into the channel or into products hawked on the channel solely because you feel some kind of responsibility to the channel creator or because you believe what they say. Definitely, no. Simply by watching a YouTube channel does not obligate you to anything. The creator spent time putting together the video, yes. But you have no obligation to give them any money in return for watching their content. It was on them that they created and posted. Don’t let the creator “guilt” you into feeling like you “need” to give them money. You don’t. You also don’t need to buy anything advertised on any channel.

If you do decide to donate to a channel or buy products from them, do it because you sincerely want to do it, not out of some sense of duty (or guilt) because you “watched” their videos. No, YouTube and Instagram and all other social media should be considered strictly entertainment. You don’t need to open your wallet to any social media influencer… and you probably shouldn’t.

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Is DealDash a Scam?

Posted in scam, scams by commorancy on October 1, 2018

I’ve always been fond of online auctions, until I found DealDash several years ago. I’ve also seen a number of people who have complained about DealDash and how it operates. Let’s explore if it’s a scam.

Auctions and Bidding

In a traditional auction, you’re actually buying from a seller who has put an item up for consignment to the auction house. This is how eBay works it. The seller uses the eBay platform to pay for their auction. If the item sells, eBay gets a cut of the profit. This is a typical auction from a typical auction house.

Bidders pay nothing to bid at eBay. You simply join the platform and off you go on your merry bidding way. You will pay for any auctions you win or any Buy-It-Nows you buy, but if you bid and don’t win, you pay nothing. This is important when understanding the difference between a site like eBay and DealDash.

At eBay, auctions have a finite end. If the auction closes at 6PM today, then it’s over at 6PM. Whomever was the highest bidder at 6PM is the winner of that auction.

DealDash Auctions

With DealDash, the auctions here work a bit differently. Instead of joining and bidding for free, you must pay for your bids. The bid cost can range between 12¢ and 60¢ per bid. In order to get started on DealDash, you’ll be required to pay for some initial bids. Sometimes DealDash offers bid sales for as low as 12¢ per bid.

As for the auctions themselves, they work quite a bit differently from eBay. Unlike eBay’s fixed close time, DealDash has no fixed auction close. Their auctions infinitely run and continue to extend until the 10 second countdown timer runs out without any further bids. As long as even one bid happens within that 10 second countdown, the auction extends with another 10 second countdown timer. Basically, an auction can run infinitely or until no one else places a bid. Bids also increment the item cost at 1¢ per bid. You spend 12-60 cents to raise the bid on an item by 1¢. Admittedly, that means the item cost goes up very slowly, but it also means that the bidding can go on for days with enough bidders.

Bid Extensions

You’re probably wondering about how people can manage to bid within 10 seconds. To answer your question, they don’t. Bidders use a feature that DealDash offers known as Bid Buddy. See below for more details. Suffice it to say that DealDash’s automated system continues punching in those bids in an automated way so users don’t have to. You’ll also notice that many of those bids are made right at the last moment of second 9. There’s no way a human could time a bid that precisely.

However, there has been some speculation that some of the bidding is rigged by DealDash. That speculation alleges that DealDash itself has its own set of automated bidders driving up auction prices and bringing attention to those auctions. I can’t tell one way or another if this is true. I’ll leave that speculation alone because of Bid Buddy and how it works.

Buy-It-Now

Both eBay and DealDash offer a Buy-It-Now option. However, these work entirely differently between DealDash and eBay. The eBay Buy-It-Now feature can be standalone or attached to an auction. If it’s standalone, you can only buy that product through Buy-It-Now. If it’s attached to an auction, you can only use Buy-It-Now before the auction begins. Once an auction has a first bid, the Buy-It-Now option disappears for that item.

With DealDash, if you bid on an auction, you are eligible to Buy-It-Now when the auction finally closes. You’ll buy the item at whatever price that DealDash offers, which they claim is usually at a substantial discount. In addition to buying the item, you’ll also get all of your bids back for free. This means you can reuse those bids again on future auctions. It’s not a bad deal if you really want that item. However, if you decline the Buy-It-Now purchase, you lose all of your bids. There’s a big incentive to bid on items where you are likely to buy it when the auction closes no matter the price.

Bid Buddy

DealDash offers an automated bidding service called Bid Buddy. It continues to bid on your behalf even when you’re not around to do so. eBay also has a similar feature, but it’s tied to the actual bidding process and doesn’t have a name. If you put in your maximum bid on an eBay auction, eBay will continue to bid on your behalf at the current bid increment until your maximum bid is reached. After that, you’d be responsible for upping your maximum bid or bidding manually.

Bid Buddy works in a similar way. It continues to bid on your behalf until you’ve run out of bids or reached the maximum number of bids set on that auction. The reason to use Bid Buddy is clear. Those who are using Bid Buddy get priority over those who are manually bidding. It is in your best interest to set up and use Bid Buddy rather than manually bidding. Otherwise, your manual bid will always be last in line.

So far, So good

So far, there’s nothing here extraordinarily bad about how DealDash works. Other than the infinitely open auction which I don’t personally like, it’s pretty straightforward in how it all works.

Products and Quality

Here’s where this site falls down hard. Do you go to DealDash to buy merchandise for a great deal or to spend time gambling to win? If it’s the former reason, then you might run into problems considering all of the below. If it’s for the latter reason, you might want to seek gambling help.

DealDash claims to offer overstocked products at “discount” prices. The difficulty with this business model is that DealDash is in this business to make money off of bidding with the side effect of an eventual sale of a product. They are not a retailer, not a discounter and definitely not in any way a reputable store. They are an auction house and that’s how they run it.

As a buyer, you’ll notice there’s nothing mentioned about a Return Policy or what to do if you receive damaged or unacceptable goods. Indeed, there’s nothing on any of DealDash’s auction listings that even mention the quality or authenticity of the merchandise that you will receive if you buy or win the bid.

The products purport to be genuine, but are they? Also, unlike eBay where there’s a seller behind each and every product, with DealDash, DealDash is the seller. This means that if you have a question about the sale of a product, you have to go to DealDash to get it answered. Worse, buyers have tried doing this with no response from DealDash.

If you’re actually wanting the product you’re bidding on, you might want to consider that what you’ll receive may entirely differ from the listing. In other words, the trust level with DealDash’s merchandise is very, very low. If you really want that merchandise, you can probably find it cheaper from a more reliable seller on eBay or Amazon without the bidding fees. On eBay, both the sellers and the products themselves have a reputation score. You can see what buyers are saying about both the product in the listing and of the seller’s reputation. You’ll notice that on DealDash, there is no reputation information about the seller nor reviews from buyers about the product or what they received. DealDash is a black box.

Being the black box that it is, unfortunately, DealDash is about as scammy as it can get from a site like this. If you can’t readily see what other buyers have received from a listing, then how do you know that you’ll receive anything of value? You don’t.

Additionally, because DealDash is not a traditional store, returning any merchandise may be next to impossible, particularly when you can’t get in touch with anyone at DealDash. If the item you receive is damaged, misrepresented or outright garbage, you’re stuck with it. Otherwise, you’ll have to dispute the credit card charge. The only other thing you can do is complain about DealDash… and many people have done exactly that on RipOff Report. However, other than venting your frustrations to the world or forcing a chargeback, you may not be able to get your money back.

Jumpers and No Jumper Auctions

Here’s where DealDash also gets just a little bit more scammy with their auction site piece. A jumper is a person who jumps in at the last minute and begins bidding on an auction when they think the auction time is about to run out. Unfortunately, jumpers on DealDash effectively mean nothing. A “No Jumper Auction” is simply a way to allow early bidders not to be outbid by someone who wants to jump in at the last minute. With DealDash, there is no such thing as a ‘last minute’. On eBay, there is a ‘last minute’ because auctions have a hard close time. On DealDash, the auction is infinitely extended so long as even one person continues bidding.

A “No Jumper Auction” sets a minimum bid point that after that no new bidders are allowed to enter the auction. If the no jumper point is set to $5, that means new bidders attempting to bid after $5 will be unable to do so. Only bidders who placed at least one bid below $5 will be able to continue bidding on that auction.

This then excludes users from auctions after the no jumper bid price has been met. On eBay, this is called ‘sniping’ or ‘snipers’. A sniper is a little different from a jumper in that because the auction close time is finite, snipers join in during the last 30 second countdown to try and outbid the current high bidder. With DealDash, a “No Jumper” feature is entirely pointless and just gives DealDash a way to manipulate auctions and who can bid. This feature only serves to force people into auctions early or wait for another one to start. This feature is simply a way to lower competition and allow early birds to win the auction more quickly without extra folks jumping in and keeping the auction open much longer. That seems to go against the idea of DealDash making more money. It’s kind of a weird feature for DealDash to add a limit auctions and prevent even more bidding, losing DealDash even more money in this process.

The scammy part of this is that apparently these “No Jumper” auctions don’t work properly, or DealDash is able to manipulate the “No Jumper” price randomly against would-be bidders. Some bidders have claimed to join in on standard “No Jumper” auctions with the default threshold set to $5. Yet, the auction price never reached $5 and they were unable to bid with DealDash claiming they were a jumper. Fishy. It seems this feature is being manipulated by DealDash in a way that prevents certain bidders (new or not) from bidding on that “No Jumper” auction.

Is DealDash worth it?

DealDash is ultimately an addictive form of legalized gambling, but it actually feels much like playing slot machines in Vegas. Mostly you lose, rarely you win and you spend a lot of money doing it…. which is how DealDash likes it. It’s what keeps them in business. If you’re willing to Buy-It-Now, you can buy back some of your bids at the cost of the product stated in the listing. But, don’t expect the price of the Buy-It-Now merchandise to be any less expensive than what you’ll find in a retail store, according to many who’d done this.

Some complainants who’ve used the Buy-It-Now option have been quite disappointed in the process. One user claimed that instead of getting their bids back as was promised, the “total value” of the bids was deducted from the price of the Buy-It-Now item. However, the “total value” of the bids applied to the reduction in the item’s cost were substantially lower than what the user paid for the actual bids. They might deduct at 12¢ per bid when the user paid 60¢ for the bids. Assuming you can actually get your bids back instead of this deduction thing, that’ll buy you a little more time to bid on new items and addict you further to this form of legalized gambling. This getting-bids-back idea is a little like losing $500 at BlackJack and then winning back $100. You’ve still lost $400. It’s simply a way to make you feel a little better about having lost $400.

If you get a high off of gambling, DealDash may be worth it… particularly if you don’t care about whatever it is you might win.

If you do happen to win the bid on item, then you’ll lose all of your bids plus whatever the winning cost of the item. If you happen to win a bundle of bids, then you’ll lose your bids only to gain some back. If you win the bid on a pair of earrings, you’ve lost however many bids it took to win that bid plus the cost of those earrings.

Consider if you don’t do Buy-It-Now often and you continually keep losing bids, you need to keep track of how much money you’ve spent there. You need to keep track because all of your lost bid money adds up when you finally do win a bid. For example, if you’ve spent $500 buying and losing bids for a while, then win a $50 coffeemaker, technically you’ve spent $550 for that coffeemaker. That’s not such a great deal. You could have bought 11 coffeemakers for the amount of money you spent to win that bid at DealDash. You simply can’t ignore all of the money you’ve spent on bids as non-existent. Those bid costs add into the cost of any items you bid and win. This means you can’t claim you got a toaster for $5. It was $5 plus the cost of however many bids it took you to get there.

Scam or Not?

The idea behind the site is fine, the execution of it is poor. If DealDash had partnered with legitimate sellers to back each of the auction products and if DealDash had allowed buyers to review the product listings for quality and authenticity and if DealDash offered a buyer’s protection plan and an actual Return Policy like a legitimate store, I might be more inclined to say it’s not a scam.

As it is, because DealDash doesn’t act like a legitimate store and also doesn’t offer feedback from buyers nor is there a buyer and seller relationship to ask questions, I cannot recommend the use of this site for any purpose… not for buying products and definitely not to get your gambling fix.

There’s too much of a chance to lose far too much bid money and very slim chances you’ll actually win a bid. Of course, you’ll be given the option to Buy-It-Now and get your bids back on auctions where you lost the bids, but that’s of little consolation if the merchandise you receive is trash, assuming you receive anything at all. Between the bids you pay for and the Buy-It-Now, this is how DealDash makes money. The rest is all an addictive game.

Testimonials

Don’t be fooled by people holding up a piece of merchandise that they claim to have received from winning an auction. There’s no guarantee those are legitimate photos. You have no idea if the merchandise you will receive is legitimate, counterfeit, refurbished, used, hot or in any other condition.

Even if the “winner” photos are legitimate, what you don’t know is how much those people have spent in bids to DealDash to “win” the privilege to buy the item at that price. They could have been bidding for years and have already spent a ton on bids before they finally won an iPad. In fact, they could very well have spent more than simply going to the Apple store and paying full price for one.

It’s just like being in a Casino. When you hear the bells ring and see the lights flash on a machine because someone has hit the jackpot, you really don’t know if that’s a win or if someone is simply making back a little money towards what they’ve already lost.

Recommendation

Site Recommendation: 👎 Avoid!
Reasons:

  • Highly Addictive
  • Form of gambling
  • Not a store
  • No Return Policy listed
  • No Product Reviews
  • No User Reviews
  • No Seller Reviews
  • Auction items don’t describe authenticity or condition
  • Pay to bid
  • Pay to win (separate from item cost)
  • Costly
  • Difficult to Communicate with DealDash
  • Mostly a scam to separate you from your money
  • Doesn’t operate like a legitimate store
  • May be less costly to shop elsewhere
  • Questionable business practices

As always, if you find Randocity a fascinating read, please leave a comment below and please click the Follow button in the upper right under the Search bar to be notified of any new Randocity articles.

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Film Review: The Warning – PBS / Frontline Documentary

Posted in bailout, banking, bankruptcy, botch, economy, insurance, scam, tanking by commorancy on November 26, 2010

Rated: 4/5 stars.

PBS’ The Warning Documentary

The Warning is a PBS documentary discussing a warning from Brooksley Born, an attorney and a former Commodity Futures Trading Commission (CFTC) chairperson. She explained that derivatives were extremely risky insurance vehicles and sent a warning that these vehicles needed regulation during her tenure as CFTC chairperson, but her warnings went unheeded. She resigned in 1999 from the CFTC position after legislation was passed preventing her agency from regulating derivatives.

Vision of this Documentary

While I would like to rate The Warning higher, its take is pretty much tunnel vision on the derivatives markets. While the derivatives markets did melt down and did, to a large degree, spur the meltdown onward, the meltdown was not started because of derivatives. The derivative meltdown was a casualty of and was exacerbated by the sub-prime mortgage meltdown. Had the mortgage industry bubble not burst, the derivatives market might have gone unchecked for many more years. The warning was and should have been about placing regulations onto mortgage lending practices. The mortgage lending industry is the industry that failed and sent the economy into a tailspin, let’s make that perfectly clear. The derivatives (insurance) market, which speculated on the mortgage industry, single-handedly sent Wall Street into a tailspin (along with several large insurance companies like AIG).

Derivatives and the Mortgage Meltdown

Anyone with half a brain in their head could see that using questionable lending vehicles like interest only loans for the first two years or adjustable rate mortgages were ticking time bombs. When the actual monthly payments came due years later after rates went up to where they should have been, people couldn’t afford pay. This was especially true when lenders were handing these loans to people who could barely afford the ‘introductory period’ payments. So, loans came due, people defaulted and the rest is history. The derivatives (insurance policies) that were issued also came due because of the en masse foreclosures. Insurance companies that issued derivative policies speculating people wouldn’t default en masse began to fail because their speculation was wrong. So then, these insurance companies couldn’t pay off on the insurance claims. So, when consumers defaulted, so did the insurance companies offering derivatives.

It wasn’t as if warnings weren’t being issued regarding the inevitable mortgage meltdown, it’s just that Brooksley Born (the focus of this film) was not one of the people issuing the mortgage warning. Her warning was strictly about the highly risky derivatives. More specifically, the black box non-transparent nature of them. The danger, of course, is that derivatives can be placed on any speculative and risky investment as insurance. The reason derivatives need to be regulated is to prevent companies the size of AIG from making stupid decisions about such risky vehicles. However, from a consumer perspective, banks should never have gotten into the position of issuing such risky mortgages like water to people who couldn’t afford them. This was the single mistake that led to where we are today and that mistake has nothing to do with derivatives and everything to do with Government and the Federal Reserve making stupid decisions.

Overall, the movie is worth watching, but also understand its information’s place in the larger meltdown that was at work in our economy.

America’s Recession: loans and scams

Posted in economy, fraud, scams by commorancy on December 16, 2008

Economic Downturn & The Fed

Unless you’ve been hiding in a cave, you’re probably aware that we’re going through a fairly deep recession. Recessions are cyclical, but in this case it probably could have been either avoided or lessened IF the banks and lenders had not been offering creative financing techniques. It also could likely have been avoided if our current pro-business govt. administration hadn’t chosen to look the other way while bad mortgages were being doled out. The problem with all of the creative financing is that it tended to lead some people into believing they could afford a mortgage they could not afford. When the loan reset after the promotional period, the realization quickly set in. Worse, the situation was compounded by property investors who sank huge amounts of loaned money into properties that would eventually become valued less than the loan.

It’s not as if the handwriting wasn’t on the wall several years ago when the fed dropped the rate to 1 percent. Now, we are back in this exact situation again with the fed dropping the rate to an unprecedented 1/2 percent. The feds are, again, trying to spur the economy like they did 2-3 years ago. But, this time, the banks don’t have money to lend. So, the 1/2 percent may not trickle down into the mortgage market like it did several years ago.

But, our economy is still likely being set up for yet another financial failure. The banks that do have money to lend are still advertising on the radio claiming extremely low interest rates.  The problem isn’t the rate, but the loan you’ll be getting. If it’s a standard fixed rate loan, that’s fine. But, it’s the fine print you need to read. Don’t get locked into an adjustable rate mortgage or a limited time interest only loan. Once these creative loans reset in a couple of years, you may end up deep under water.

The Fed, therefore, needs to be extra careful when cutting the rates this low again to avoid the same mortgage problems all over again.

Scams in a down economy

With the economy being so depressed, it’s also a good idea to watch your money closely. As money gets tighter and tighter, the scammers will come out of the woodwork (and they already are). I’ve already noticed a drastic increase in spam and phishing emails since the economy has taken a turn. It’s going to get worse before it gets better.

There are many scams out there from the Nigerian 419 scam that claims to give you a ton of money only to rip you off of thousands of dollars before you realize it, to sending you what look like official invoices that only turn out to be scams in themselves. Don’t fall for them. The easiest way to avoid scams is to not give out any personal information to anyone who approaches you claiming to be from a legit company. This means, if you receive a call asking you to make a payment and they request for you to give a credit card over the phone, don’t. Make sure you know who this company is first and make sure you are a customer. Then, tell the company that you will call them back through their official channels and make a payment that way. As long as you are the person making the call to the official number, you should be safe. With incoming calls, you have no idea who is really calling you no matter what the CallerID says. Always, always call companies back from official numbers located on a trusted bill or from the back of your credit card.

TV advertisements that offer products or services usually employ people who are not paid very well. So, be wary when you give your credit card number out to TV commercial based purchases. Not only are some of these companies impossible to get refunds, your card number could be enrolled in a club or, worse, stolen by one of the telephone operators in an independent scam. You should always Google the product you are thinking of purchasing to 1) find out if you can find it cheaper online and 2) find out if people have had issues with either the product or the companies refund polices.

Get rich schemes are basically another form of scam. Yes, they do make someone rich… the person who created the scheme, but not you. Get rich schemes are usually designed to part you from your money. So, in a down economy, you should avoid get rich schemes (placing classified ads, setting up ecommerce sites that sell Amway products, or Multi Level Marketing – MLM schemes). Note that MLMs only make the top most people money. If you’re anywhere near the bottom, you will be parted from your money.

Craigslist and even eBay are a haven for scammers. Be careful when you work with people selling or renting things. Never buy or rent anything sight unseen and never give money out as a ‘deposit’ or to ‘hold’ something unless you truly trust the individual. Chances are, if the person you are thinking of doing business is presently outside of the US, you should immediately stop the transaction unless you know for sure that what they are selling/renting is legit.

If you are selling a car or renting out an apartment, watch out for scams here too. There are some people who are outside of the US who will claim to give you an excessive sum of money in the form of a check. They may even send you what looks like an official check.. the problem is that it will bounce causing you fees and other associated problems (and may let them get access to your account number). Don’t cash any checks like this.

The bottom line is that in this weak economy, you should be extra careful with your money as there are lots of desperate unemployed people willing to do anything to make a buck (or a thousand). Always make sure to do your homework before buying anything or giving out personal information to someone you don’t know. If you suspect a scam, you should alert your bank or credit card company immediately.

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