Big Money

For some reason I was thinking about bail bonds and policemen this morning. It is a world very far removed from everyday America. Jay Leno was making cracks about $3 a gallon gasoline and all the profits oil companies are making. Everybody likes to complain about the price of gas, but compared to Europe, it is a pittance. Of course, America is very much bigger than Europe, so land is cheaper, we are more spread out and we have farther to travel. Paying European prices for fuel would put a definite crimp in our lifestyle.

My brother was looking at stock for a Norwegian oil exploration company. I looked up their web site and realized, for the umpteenth time, how much money gets spent on drilling for oil. It must be in the billions of dollars a year. Perhaps a trillion dollars in a decade.

Computer chip factories (fabrication facilities, or fabs) cost billions of dollars to build, so they can make zillions of chips that sell for next to nothing. I imagine the life cycle of a fab goes something like this. Five years of planning, one year to build, one year to get everything sorted out, and three years to make enough money to pay for building it. After that, someone else will have built a more efficient fab and yours will be obsolete. However, it is now paid for so you can continue making money as long as you can continue to sell the chips you are making. That may be another five years. After that it will either slide into abandonment, or it will need to be overhauled. I suspect that the big expense is in the equipment that goes inside, so it may just be easier all around to build an all new facility than to try and refurbish an old building.

And don't forget about trains. They are like something from the dark ages, nothing new going on there, but the investment in infrastructure is tremendous. There are the rail lines, and the engines and rolling stock, but the really big item is the land. Thousands of miles of rail lines are sitting on thousands of miles of land. I would not be surprised if the value of all this land in America was a trillion dollars.

So what does all this have to do with bail bonds? For many Americans, a bail bond is going to the largest amount of money they will every deal with. Last I heard bail bondsmen charged ten percent of the bond. If the judge sets your bond at fifty thousand dollars, that is how much the court wants, in cash, to let you out of jail until your trial. The bondsman will put up the fifty thousand, but you have to pay him five thousand. Pay him, mind you. You do not get the five thousand back. You give him the five thousand, it's gone. You show up for trial, he gets his fifty thousand back. You don't show up, he sends a bounty hunter after you. The bounty hunter gets the five thousand to track your sorry behind down and haul you back to jail. There may be variations in the details, but that is roughly the way it works.

So a few thousand dollars is the most many Americans are going to deal with, and it is going to be under the most unpleasant circumstances.