Dr. Philip Kotler defines marketing as "the science and art of exploring, creating, and delivering value to satisfy the needs of a target market at a profit. Marketing identifies unfulfilled needs and desires. It defines, measures and quantifies the size of the identified market and the profit potential."
For over 70 years the marketing of one fruit made it increasingly ever-present, to the point of it feeling rammed down our throats. The Red Delicious, in American consciousness represents the quintessential apple. It's the one you see one the teachers desk, the one in every students lunchbox. It is also know as the official compost food. Because as aesthetically pleasing as it is to the eye, one bite reminds you that what you really want is one of those crispy golden apples instead.
So how is it that they keep selling, and we keep buying this good awful thing? Well actually we're getting hip to the game and production of the gorgeous monstrosity is finally on the decline but still, how did we ever let it get this far?
Our story starts rather innocently, with few traces of capitalism involved. Jesse Hiatt, an Iowa farmer came across a mutant seedling that refused to die. Year by year he chopped it down and year by year it grew back, so finally he let nature bear its course. It did and what resulted was a thing of beauty - read with yellow stripping - it had a strong beautiful skin and sweet delicious meat inside. Hiatt named it "Hawkeye" in Iowa tradition and boasted of the mutated beauty he'd cultivated. He entered into a contest in Louisiana, Missouri, hosted by Stark Nurseries. The Stark brothers ran the nursery and were looking to a replacement apple for the "Ben Davis" which was the apple of the day at that time. The "Hawkeye" won, the Stark brothers purchased it and initially named it simply "Delicious". Yes apparently at that time, the fruit still tasted good, but we'll get to how its not even good enough to be made into a candy apple now later.
The "Ben Davis"
In 1923 a farmer reported back to Stark Nurseries that a strange and beautiful mutation had occurred on one of his seedlings, producing a magnificent and ll crimson apple tree. Instantly wildly popular people flocked from all over to gawk at and devour this new rare beaut of a fruit.
Stark capitalized off of this combined with another popular seedling the bore - the "Golden Delicious" - and rebranded their new apple as the "Red Delicious". They went on what would equate today to a multi-million dollar marketing campaign, and even went as far as to railroad out seedlings cross country.
As growers rushed to mimic this brilliant looking mutation they we encountered by mother natures own glorious randomness that produced the red beauty in the first place. This led grower's to adopting new methods to control the process. They would graft branches to to get the desirable traits their were after. A Life of Apples wrote: "This has allowed growers and breeders to choose mutations that may be redder or more 'perfectly' shaped, constantly moving the Red Delicious closer to an ever-changing ideal of a perfect apple, and further from what Jesse Hiatt first bit into on an October day in 1872." They also began manipulating the fruit to make it easier to be mass produced and stored for longer. This led to stronger tougher skin the hid the blemishes and impurities. That's why so often you bite into what looks like a gorgeous apple only to find yourself having been duped by your eyes.
And the thing is, for a long time, we just went with it. They keep making it redder and prettier, and making more and more of them, and we just kept on taking that first bite, and then throwing them away. But as our taste buds have caught on sales for the Red Delicious have declined. While many of us remember the bailouts of the bank and the auto industry, less known is the time President Clinton bailed out the apple industry. And while the Red Delicious is still massively overproduced, we're starting to ship them overseas now, to places where people have no idea what apples are supposed to taste like. Meanwhile in America we've been back out on the market, flirting with Galas and Fujis, and Grannysmith's.
When you take out a loan for a car, charge something to your credit card, or get a personal line of credit, there is going to be an interest rate that applies to your loan.
A lot of different factors go into what you will be charged, including your own personal credit score. But even those with flawless credit still see a minimum charge that they can't get around. That all goes back to the Federal Funds Rate.
One thing consumers rarely realize is that all of our banks are lending money to each other every night. Banks are legally required to maintain a certain percentage of their deposits in non-interest-bearing accounts at the Federal Reserve to ensure they have enough money to cover any withdrawals that may unexpectedly come up. However, deposits can fluctuate and it's very common for some banks to exceed the requirement on certain days while some fall short. In cases like this, banks actually lend each other money to ensure they meet the minimum balance. It's a bit hard to imagine these multibillion-dollar financial institutions needing to borrow money to tide them over for a bit, but it happens every single night at the Federal Reserve. It's also a nice deal for those with balances above the reserve balance requirement to earn a bit of money with cash that would normally just be sitting there.
The Federal Reserve
The exact interest rate the banks will charge each other is a matter of negotiation between them, but the Federal Open Market Committee (FOMC) (the arm of the Federal Reserve that sets monetary policy) meets eight times a year to set a target rate. They evaluate a multitude of economic indicators including unemployment, inflation, and consumer confidence to decide the best rate to keep the country in business. The weighted average of all interest rates across these interbank loans is the effective federal funds rate.
This rate has a huge impact on the economy overall as well as your personal finances. The federal funds rate is essentially the cheapest money available to a bank and that feeds into all of the other loans they make. Banks will add a slight upcharge to the rate set by the Fed to determine what is the lowest interest that they will announce for their most creditworthy customers, also known as the prime rate. If you have a variable interest rate loan (very common with credit cards and some student loans), it's likely that the interest rate you pay is a set percentage on top of that prime rate that your lender is paying. That's why in times of low interest rates (it was set at 0% during the Great Recession), a lot of borrowers should go for fixed interest rate loans that won't increase. However, if the federal funds rate was relatively high (it went up to 20% in the early 1980's), a variable interest rate loan may be a better decision as you would be charged less interest should the rate drop without the need to refinance.
The federal funds rate also has a major impact on your investment portfolio. The stock market reacts very strongly to any changes in interest rates from the Federal Reserve, as a lower rate makes it cheaper for companies to borrow and reinvest while a higher rate may restrict capital and slow short-term growth. If you have a significant portion of your investments in equities, a small change in the federal funds rate can have a large impact on your net worth.
Whether you're leaving a job involuntarily, departing for something new, or just want to prepare for the unknown, it is smart to understand all your options regarding your 401k.
Frugal gifting often gets a bad reputation. However, this shopping method does not make you cheap — it makes you practical. Frugal gifts often avoid waste and overspending and can be just as meaningful (if not more so) as any other present.
With the National Retail Federation predicting each consumer this holiday season to spend upwards of $1,000 on holiday gifts amidst an economic recession —this year might be the perfect time to reconsider your spending budget. We've formulated the ultimate list of frugal gift-giving ideas to get you started.