Well, now you can watch When you buy from Bloomex, do you get your money’s worth? It’s a video from CBC’s Marketplace and it’s well done, professional quality. They even put in actual orders and had experts evaluate what Bloomex delivered. And their verdict is …

Now we’ve come across Nassim Nicholas Taleb, a financial scholar and former securities trader, and his book The Black Swan: The Impact of the Highly Improbable. The Black Swan refers to a rare event. Taleb argues that economists’ current financial risk models are completely inadequate for dealing with the world’s interconnected economy in case a black swan comes along.

In an op-ed piece for FT.com, Taleb notes that the “Nobel Prize for Economics” is actually mislabeled. It was started and is funded by the Swedish central bank, and is officially the “Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel”. But it’s not one of the awards Alfred Nobel originally created. Those Swedish bankers are a clever bunch.

Taleb also has a few choice things to say about the “science” of economics, like:

• Modern portfolio management “has the empirical and scientific validity of astrology”
• The environment in financial economics is “reminiscent of medieval medicine”
• “The (Nobel economics) prize is … an insult to science”

Gee, what do you suppose he really thinks? You can find out more at Nassim Nicholas Taleb’ home page, which is aptly named fooledbyrandomness.com.

Under the terms of the settlement, FTD must also permanently end the practice of providing consumers’ billing information to companies that market discount clubs online. FTD’s $640,000 will go into a fund that will pay for consumer education, refunds, and the costs of the investigation.

FTD (a.k.a. “Florists’ Transworld Delivery”), headquartered in Downers Grove, Illinois, is one of the biggest players in the floral wire service business in North America. Two other big florist “order gatherer” companies, 1-800-Flowers and Pro Flowers, as well as many other well-known retailers, are also involved in what has been referred to as a “billion dollar web scam”.

According to the Attorney General, the scheme “tricked hundreds of thousands of New York consumers”. But New York is just one state – there are another 49 to go. The precedent may accelerate settlements in other jurisdictions.

The official press release is here. See our January 2010 blog post on FTD and 1-800-Flowers in Scam Probe for more background.

FTD and 1-800-Flowers were summoned before the U.S. Senate Commerce Committee to explain their involvement with these so-called “post-transaction marketing” schemes. Many consumer complaints have also been lodged against another major flower seller, Pro Flowers, over the same issue. These companies sold out their customers to various loyalty marketing firms, including Affinion, Ezsaver, Webloyalty, and Vertrue.

It’s not just limited to the flower business. Other companies cited as making money from the scheme include Buy.com, Priceline, Travelocity, Avon, eHarmony, Hertz, Pizza Hut, Victoria’s Secret, and others.

Here are links to more information, which in turn have further references.

• Online Florists: Whither the ethics?, Real Florist Blog at flowerchat.com
• Feds: Top e-tailers profit from billion-dollar Web scam, by Greg Sandoval, cnet.com
• Lawmakers Slam Deceptive Web Marketers, by Thomas Claburn, Information Week

Note that MoonFlower Florist is a member of the Teleflora network, which is not involved in these nefarious goings-on. In any event, since we have our own website, MoonFlower.ca, we have complete control over our own database. We absolutely do not sell or pass on any website visitor or customer information to anyone. At MoonFlower Florist, we truly value and appreciate your business.

Technically, meaning in the economists’ definition, a recession is a least two consecutive quarters of decline in real Gross Domestic Product (GDP). This is also known as “negative growth”, although an increase is never called “positive shrinkage”, but that’s another story. Thereafter, as soon as a quarter comes along with GDP growth at or above 0%, the recession is declared to be over. In Canada, that happened in the third quarter of 2009, when GDP growth was 0.3%. That’s not a whole lot, but it’s a positive number nevertheless.

The trouble here is that real GDP growth in Canada over the last 10 years averaged about 3.1%. The Q3 2009 gain of a mere 0.3% is positive, but still way below average. If you’re used to 3.1%, 0.3% just doesn’t cut it.

What’s worse is that it’s difficult to see when things will get back to normal, namely, something like the good old average that we’re used to. For one thing, all those government economic stimulus and bailout programs won’t be around in 2010. Governments have also run up big deficits because of those programs, which taxpayers will eventually have to pay for. Plus, unemployment remains high, so there’s fewer income earners to foot the bill.

So here’s a proposition for economists. Instead of saying “the recession is over” when GDP just limps into positive territory, change the decision point to when GDP growth returns to the 10 year average, or even gets within 50% of the 10 year average for that matter. This is a much more realistic way of describing what’s going on. It would be good for your PR, especially after having so utterly missed calling the recession in the first place.

For more mockery, see Let’s Rescind the Nobel Prize for Economics. The above is from the bottom of the back of  a drawer in an old desk, more or less, and we can’t make out who the cartoonist is. If you can shed any light on this, please let us know!

So the question is: why didn’t the professional economists of the day see this train wreck coming? They are highly educated, well trained, and have access to teams of analysts, captains of industry, and leaders of government. They’re the ones who are supposed to be looking after these things for us. And what are they doing about it? And how can we the people ever trust them again? Perhaps the sad truth is that our modern day economists are really no better than the shamans, witch doctors, and snake oil salesmen of the past. Scary thought there. In any event, it seems clear that economists have very seriously dropped the ball on this one, and it’s going to cost us all plenty.

Economics is also called “the dismal science”. As it turns out, even that might be putting it generously. We have to ask if it’s a “science” at all, of any description, after so completely and utterly missing the mark.

Here then is a proposal: let’s rescind the Nobel Prize for economics. Just drop it, cut it out, throw it away. The main reason for this is on straight academic grounds, namely, that we can’t be sure that economics really does the job, let alone actually prove that it promotes the betterment of humankind. Secondly, let’s mete out some punishment to the experts who are supposed to watch over matters economic but failed so miserably.