WEBVTT
00:00:04.480 --> 00:00:06.400
This is another week with a quick hitter.
00:00:06.559 --> 00:00:11.039
Listen, a couple weeks ago the FTC forced Ticketmaster to show the full price up front.
00:00:11.199 --> 00:00:15.679
They complied, which in Ticketmaster means the mugging now comes with an itemized receipt.
00:00:15.839 --> 00:00:17.679
This is junk fee strip pricing.
00:00:17.839 --> 00:00:20.079
The advertised price is just the bait price.
00:00:20.239 --> 00:00:21.120
Here's how it works.
00:00:21.280 --> 00:00:26.960
Michelle Madrigal, California, 2024, she bought three concert tickets on Ticketmaster.
00:00:27.120 --> 00:00:31.440
Displayed price was$290 per ticket,$870 total.
00:00:31.600 --> 00:00:36.079
She picks her seats, enters her credit card, and then guess what?
00:00:36.399 --> 00:00:41.119
$164 in mandatory service fees plus$78 in taxes.
00:00:41.359 --> 00:00:43.840
Final cost is now$1,112.
00:00:44.399 --> 00:00:46.880
28% above the price she clicked on.
00:00:47.039 --> 00:00:50.159
The fee waited until her credit card was emotionally involved.
00:00:50.320 --> 00:00:51.600
And here's the kicker.
00:00:51.840 --> 00:00:54.479
Four researchers ran a field experiment on StubHub.
00:00:54.719 --> 00:00:57.280
Blake, Mosherry, Sweeney, and Tatalus.
00:00:57.439 --> 00:00:59.359
Same platform, real buyers.
00:00:59.600 --> 00:01:01.600
Marketing Science 2021.
00:01:01.840 --> 00:01:04.799
Drip pricing made 21% more money.
00:01:04.879 --> 00:01:06.719
So hidden fees aren't a bug.
00:01:06.799 --> 00:01:08.879
They're a business model with footnotes.
00:01:09.120 --> 00:01:13.200
Every hidden fee exists because hiding it literally pays better than showing it.
00:01:13.359 --> 00:01:16.239
Now, same architecture applied to your rent.
00:01:16.400 --> 00:01:19.840
You see a listing,$1,500 a month, sounds reasonable.
00:01:20.000 --> 00:01:23.200
You apply, well, there's a$60 application fee.
00:01:23.359 --> 00:01:24.879
Despite that, you sign.
00:01:25.120 --> 00:01:33.680
Then comes the pet fee for a cat that lives somewhere else and the facility fee for the gym that sucks and has one treadmill and a lawsuit pending.
00:01:33.840 --> 00:01:35.120
And then here's my favorite.
00:01:35.439 --> 00:01:36.719
Ballet trash.
00:01:37.280 --> 00:01:39.439
Ballet trash.
00:01:40.239 --> 00:01:46.079
That means a mandatory charge for someone to walk your garbage 10 yards from your door to the dumpster.
00:01:46.239 --> 00:01:47.439
You can't opt out.
00:01:47.599 --> 00:01:52.719
The FTC just settled with Graystar, largest multifamily landlord in the country.
00:01:52.879 --> 00:01:56.239
$24 million for concealing mandatory fees.
00:01:56.400 --> 00:02:03.519
Approved two to nothing by Republican commissioners under Chair Andrew Ferguson, who said it would inform new rulemaking on rental housing.
00:02:03.680 --> 00:02:05.680
Same story with invitation homes.
00:02:05.920 --> 00:02:08.080
Largest single family landlord in the country.
00:02:08.319 --> 00:02:09.360
$48 million.
00:02:10.000 --> 00:02:14.719
Hidden fees totaling more than$1,700 per renter per year.
00:02:15.039 --> 00:02:18.960
444,000 people just got refund checks.
00:02:19.199 --> 00:02:19.919
Well, guess what?
00:02:20.000 --> 00:02:21.840
They average 106 bucks.
00:02:22.080 --> 00:02:22.960
That's the trick.
00:02:23.199 --> 00:02:26.800
The fee is monthly, the refund is apology sized.
00:02:26.960 --> 00:02:28.159
And here's the moment.
00:02:28.400 --> 00:02:29.439
2019.
00:02:29.680 --> 00:02:34.240
Internal email, CEO of Invitation Homes to a senior BP.
00:02:34.400 --> 00:02:35.680
Not a public statement.
00:02:35.840 --> 00:02:41.039
The boss said, quote, juice this hog by making the smart home fee mandatory.
00:02:41.360 --> 00:02:43.280
Juice this hog.
00:02:43.680 --> 00:02:45.360
That's not a bill in line.
00:02:45.520 --> 00:02:47.120
That's a quarterly objective.
00:02:47.280 --> 00:02:48.800
It's not just rent though.
00:02:48.879 --> 00:02:50.000
It's everywhere.
00:02:50.240 --> 00:02:55.520
Airlines pulled in$8.3 billion in bag fees in 2023.
00:02:55.680 --> 00:02:57.199
Yeah, you heard that number right.
00:02:57.439 --> 00:03:01.919
The Senate Permanent Subcommittee on Investigations went and looked, and you know what they found?
00:03:02.080 --> 00:03:05.919
Airlines don't even track what it actually costs them to handle the fucking bags.
00:03:06.080 --> 00:03:10.560
So it's not a price for service, it's a profit cost playing as a logistic model.
00:03:10.800 --> 00:03:14.560
Banks made$9.1 billion in overdraft fees.
00:03:14.800 --> 00:03:16.479
The CFPB math?
00:03:16.639 --> 00:03:25.439
A typical$26 overdraft paid back in three days at the standard$35 fee equals an effective APR of$16,000.
00:03:26.400 --> 00:03:28.240
$16,000.
00:03:28.479 --> 00:03:30.960
At that point, don't call it overdraft protection.
00:03:31.039 --> 00:03:34.319
Call it what it is, a payday loan wearing a bank polo.
00:03:34.479 --> 00:03:41.360
Your bank charges more in three days for$26 than some credit cards charge you in a year for$26,000.
00:03:41.520 --> 00:03:43.360
Sometimes the same bank.
00:03:43.599 --> 00:03:47.439
The left hand offers the points, the right hand takes hostages.
00:03:47.599 --> 00:03:49.039
Now I'll be straight with you.
00:03:49.199 --> 00:03:51.280
The industry has one real argument.
00:03:51.599 --> 00:03:55.599
Unbundling can lower the sticker price for people hunting the cheapest fare.
00:03:56.080 --> 00:04:02.240
Airlines for America says it, Cato says it, all in pricing could raise advertised prices.
00:04:02.479 --> 00:04:02.960
Fine.
00:04:03.199 --> 00:04:07.520
That argument gets a chair at the table, it doesn't get the whole fucking house.
00:04:07.759 --> 00:04:12.639
Because the Senate asks a simple question, what does it actually cost you to handle a single bag?
00:04:12.800 --> 00:04:14.319
The airlines didn't track it.
00:04:14.560 --> 00:04:19.360
Ticketmaster's own help docs say these may not reflect the actual cost.
00:04:19.600 --> 00:04:23.680
The defense works right up until someone says, Oh yeah, cool, bro.
00:04:24.000 --> 00:04:25.839
What did the bag actually cost you?
00:04:26.000 --> 00:04:29.439
Then suddenly we got to take a break and everybody has to have a meeting.
00:04:29.680 --> 00:04:34.480
Typical Washington, the only junk fee role that survived was the bipartisan one.
00:04:34.800 --> 00:04:42.079
FTC tickets and lodging, signed under Republican chair Andrew Ferguson in December of 2024, is in force.
00:04:42.240 --> 00:04:44.800
The single party ones got fed into the wood chipper.
00:04:45.199 --> 00:04:46.399
Airline roll, gone.
00:04:46.560 --> 00:04:50.720
Overdraft role, gone, credit card late fee cap, gone.
00:04:50.959 --> 00:04:52.480
Both parties take the money.
00:04:52.639 --> 00:04:57.279
The American Hotel and Lodging Association alone employs 38 lobbyists.
00:04:57.360 --> 00:04:58.240
And guess what?
00:04:58.399 --> 00:05:00.959
18 of them are former government officials.
00:05:01.199 --> 00:05:04.399
Yeah, the revolving door has a resort fee.
00:05:04.560 --> 00:05:06.000
So here's what you can do.
00:05:06.240 --> 00:05:12.879
Right now, any transaction before you click, sort by total cost, not by sticker price.
00:05:13.040 --> 00:05:16.079
Don't put your card in until the total stops moving.
00:05:16.240 --> 00:05:23.600
When the Stub Hub experiment showed people the all-in price up front, they bought less, and they bought lower priced options.
00:05:23.839 --> 00:05:29.519
28% of the revenue gap came from people just choosing differently when they could see what things actually cost.
00:05:29.839 --> 00:05:34.560
You can't kill the architecture, but you can refuse to be the data point that makes it profitable.
00:05:34.720 --> 00:05:39.759
And if you think this is bad, wait until I tell you what happens when they turn the computers loose on it.
00:05:40.000 --> 00:05:41.920
That's not a tip, that's the move.
00:05:42.160 --> 00:05:43.199
Now subscribe.
00:05:43.360 --> 00:05:45.439
There is no service fee yet.
00:00:04.480 --> 00:00:06.400
This is another week with a quick hitter.
00:00:06.559 --> 00:00:11.039
Listen, a couple weeks ago the FTC forced Ticketmaster to show the full price up front.
00:00:11.199 --> 00:00:15.679
They complied, which in Ticketmaster means the mugging now comes with an itemized receipt.
00:00:15.839 --> 00:00:17.679
This is junk fee strip pricing.
00:00:17.839 --> 00:00:20.079
The advertised price is just the bait price.
00:00:20.239 --> 00:00:21.120
Here's how it works.
00:00:21.280 --> 00:00:26.960
Michelle Madrigal, California, 2024, she bought three concert tickets on Ticketmaster.
00:00:27.120 --> 00:00:31.440
Displayed price was$290 per ticket,$870 total.
00:00:31.600 --> 00:00:36.079
She picks her seats, enters her credit card, and then guess what?
00:00:36.399 --> 00:00:41.119
$164 in mandatory service fees plus$78 in taxes.
00:00:41.359 --> 00:00:43.840
Final cost is now$1,112.
00:00:44.399 --> 00:00:46.880
28% above the price she clicked on.
00:00:47.039 --> 00:00:50.159
The fee waited until her credit card was emotionally involved.
00:00:50.320 --> 00:00:51.600
And here's the kicker.
00:00:51.840 --> 00:00:54.479
Four researchers ran a field experiment on StubHub.
00:00:54.719 --> 00:00:57.280
Blake, Mosherry, Sweeney, and Tatalus.
00:00:57.439 --> 00:00:59.359
Same platform, real buyers.
00:00:59.600 --> 00:01:01.600
Marketing Science 2021.
00:01:01.840 --> 00:01:04.799
Drip pricing made 21% more money.
00:01:04.879 --> 00:01:06.719
So hidden fees aren't a bug.
00:01:06.799 --> 00:01:08.879
They're a business model with footnotes.
00:01:09.120 --> 00:01:13.200
Every hidden fee exists because hiding it literally pays better than showing it.
00:01:13.359 --> 00:01:16.239
Now, same architecture applied to your rent.
00:01:16.400 --> 00:01:19.840
You see a listing,$1,500 a month, sounds reasonable.
00:01:20.000 --> 00:01:23.200
You apply, well, there's a$60 application fee.
00:01:23.359 --> 00:01:24.879
Despite that, you sign.
00:01:25.120 --> 00:01:33.680
Then comes the pet fee for a cat that lives somewhere else and the facility fee for the gym that sucks and has one treadmill and a lawsuit pending.
00:01:33.840 --> 00:01:35.120
And then here's my favorite.
00:01:35.439 --> 00:01:36.719
Ballet trash.
00:01:37.280 --> 00:01:39.439
Ballet trash.
00:01:40.239 --> 00:01:46.079
That means a mandatory charge for someone to walk your garbage 10 yards from your door to the dumpster.
00:01:46.239 --> 00:01:47.439
You can't opt out.
00:01:47.599 --> 00:01:52.719
The FTC just settled with Graystar, largest multifamily landlord in the country.
00:01:52.879 --> 00:01:56.239
$24 million for concealing mandatory fees.
00:01:56.400 --> 00:02:03.519
Approved two to nothing by Republican commissioners under Chair Andrew Ferguson, who said it would inform new rulemaking on rental housing.
00:02:03.680 --> 00:02:05.680
Same story with invitation homes.
00:02:05.920 --> 00:02:08.080
Largest single family landlord in the country.
00:02:08.319 --> 00:02:09.360
$48 million.
00:02:10.000 --> 00:02:14.719
Hidden fees totaling more than$1,700 per renter per year.
00:02:15.039 --> 00:02:18.960
444,000 people just got refund checks.
00:02:19.199 --> 00:02:19.919
Well, guess what?
00:02:20.000 --> 00:02:21.840
They average 106 bucks.
00:02:22.080 --> 00:02:22.960
That's the trick.
00:02:23.199 --> 00:02:26.800
The fee is monthly, the refund is apology sized.
00:02:26.960 --> 00:02:28.159
And here's the moment.
00:02:28.400 --> 00:02:29.439
2019.
00:02:29.680 --> 00:02:34.240
Internal email, CEO of Invitation Homes to a senior BP.
00:02:34.400 --> 00:02:35.680
Not a public statement.
00:02:35.840 --> 00:02:41.039
The boss said, quote, juice this hog by making the smart home fee mandatory.
00:02:41.360 --> 00:02:43.280
Juice this hog.
00:02:43.680 --> 00:02:45.360
That's not a bill in line.
00:02:45.520 --> 00:02:47.120
That's a quarterly objective.
00:02:47.280 --> 00:02:48.800
It's not just rent though.
00:02:48.879 --> 00:02:50.000
It's everywhere.
00:02:50.240 --> 00:02:55.520
Airlines pulled in$8.3 billion in bag fees in 2023.
00:02:55.680 --> 00:02:57.199
Yeah, you heard that number right.
00:02:57.439 --> 00:03:01.919
The Senate Permanent Subcommittee on Investigations went and looked, and you know what they found?
00:03:02.080 --> 00:03:05.919
Airlines don't even track what it actually costs them to handle the fucking bags.
00:03:06.080 --> 00:03:10.560
So it's not a price for service, it's a profit cost playing as a logistic model.
00:03:10.800 --> 00:03:14.560
Banks made$9.1 billion in overdraft fees.
00:03:14.800 --> 00:03:16.479
The CFPB math?
00:03:16.639 --> 00:03:25.439
A typical$26 overdraft paid back in three days at the standard$35 fee equals an effective APR of$16,000.
00:03:26.400 --> 00:03:28.240
$16,000.
00:03:28.479 --> 00:03:30.960
At that point, don't call it overdraft protection.
00:03:31.039 --> 00:03:34.319
Call it what it is, a payday loan wearing a bank polo.
00:03:34.479 --> 00:03:41.360
Your bank charges more in three days for$26 than some credit cards charge you in a year for$26,000.
00:03:41.520 --> 00:03:43.360
Sometimes the same bank.
00:03:43.599 --> 00:03:47.439
The left hand offers the points, the right hand takes hostages.
00:03:47.599 --> 00:03:49.039
Now I'll be straight with you.
00:03:49.199 --> 00:03:51.280
The industry has one real argument.
00:03:51.599 --> 00:03:55.599
Unbundling can lower the sticker price for people hunting the cheapest fare.
00:03:56.080 --> 00:04:02.240
Airlines for America says it, Cato says it, all in pricing could raise advertised prices.
00:04:02.479 --> 00:04:02.960
Fine.
00:04:03.199 --> 00:04:07.520
That argument gets a chair at the table, it doesn't get the whole fucking house.
00:04:07.759 --> 00:04:12.639
Because the Senate asks a simple question, what does it actually cost you to handle a single bag?
00:04:12.800 --> 00:04:14.319
The airlines didn't track it.
00:04:14.560 --> 00:04:19.360
Ticketmaster's own help docs say these may not reflect the actual cost.
00:04:19.600 --> 00:04:23.680
The defense works right up until someone says, Oh yeah, cool, bro.
00:04:24.000 --> 00:04:25.839
What did the bag actually cost you?
00:04:26.000 --> 00:04:29.439
Then suddenly we got to take a break and everybody has to have a meeting.
00:04:29.680 --> 00:04:34.480
Typical Washington, the only junk fee role that survived was the bipartisan one.
00:04:34.800 --> 00:04:42.079
FTC tickets and lodging, signed under Republican chair Andrew Ferguson in December of 2024, is in force.
00:04:42.240 --> 00:04:44.800
The single party ones got fed into the wood chipper.
00:04:45.199 --> 00:04:46.399
Airline roll, gone.
00:04:46.560 --> 00:04:50.720
Overdraft role, gone, credit card late fee cap, gone.
00:04:50.959 --> 00:04:52.480
Both parties take the money.
00:04:52.639 --> 00:04:57.279
The American Hotel and Lodging Association alone employs 38 lobbyists.
00:04:57.360 --> 00:04:58.240
And guess what?
00:04:58.399 --> 00:05:00.959
18 of them are former government officials.
00:05:01.199 --> 00:05:04.399
Yeah, the revolving door has a resort fee.
00:05:04.560 --> 00:05:06.000
So here's what you can do.
00:05:06.240 --> 00:05:12.879
Right now, any transaction before you click, sort by total cost, not by sticker price.
00:05:13.040 --> 00:05:16.079
Don't put your card in until the total stops moving.
00:05:16.240 --> 00:05:23.600
When the Stub Hub experiment showed people the all-in price up front, they bought less, and they bought lower priced options.
00:05:23.839 --> 00:05:29.519
28% of the revenue gap came from people just choosing differently when they could see what things actually cost.
00:05:29.839 --> 00:05:34.560
You can't kill the architecture, but you can refuse to be the data point that makes it profitable.
00:05:34.720 --> 00:05:39.759
And if you think this is bad, wait until I tell you what happens when they turn the computers loose on it.
00:05:40.000 --> 00:05:41.920
That's not a tip, that's the move.
00:05:42.160 --> 00:05:43.199
Now subscribe.
00:05:43.360 --> 00:05:45.439
There is no service fee yet.
