Wednesday, October 29, 2008

Some interesting links

A NY Times article today on the growing problems with credit cards, which calls it the next crisis - unemployment and recession leading to defaults leading to raised interest rates and lowered credit limits for everybody else. People can no longer use their home equity loans to juggle their credit card debt, is what it comes down to.

Working off that article, here's a good post from Zen Habits on how to deal with the credit card crisis: it's is worth reading in its entirety, but it's basically to move away from debt, pay down debt (perhaps by using the debt snowflake model I talk about here), and stop spending money. Good advice, like I say.

Consumer Reports has a new Money Blog written by Tightwad Todd which is pretty consistently worthwhile. A couple of days ago I had the oil in the '98 Voyager changed (110,000 miles - I decided to put off the larger service call until it gets to 120K ptui ptui ptui which is what the manual recommends) and at about the same time, Get Rich Slowly happened to have a post saying that he thought the 3,000K recommendation for oil changes was a con cooked up by the likes of Jiffy Lube. He doesn't exactly say not to do it, instead saying to rely on the owners manual rather than a general guideline. Which I guess is okay, but my owner's manual says to do it every 3,000 miles and anyway, Tightwad Todd says that one is foolish to ignore this simple and routine procedure, that any American car should be able to get to 200,000 miles if it's treated well and part of being treated well is regular oil changes.
Mike Quincy, one of our long-time auto writers, says the most important trick to keeping a car performing properly is to follow the manufacturer's recommended maintenance schedule and make any repairs promptly. If you think you’re saving money by skipping an oil change, you’re wrong, Quincy says. Missing even one oil change can accelerate premature engine wear and cause engine damage, reducing long term reliability.
And if you can't believe Consumer Reports (no advertising) who can you believe? I sometimes push it to almost 4,000 miles, but I need this car to last for a while so I want to be nice to it.

Third, I've been noticing a bunch of hits on this site from a blog called "justice desserts." It's part of what it calls the "urban homesteader" movement, pretty hardcore DIY and back to the land. I've been sort of looking at it for the last month, there's s a bit of a survivalist vibe that I find myself reacting to negatively but that may be more about me - there's a lot of good information on there and it's definitely worth a looksee. And they put my link under a heading, "Blogs of those who eat and love Justice," which I am proud to say is true.

Article in this week's Newsweek on frugality - the title says it all: Thrift is the New Fashion:
Thrift, like the repossession business, is one of those classic countercyclical industries. When the gross domestic product shrinks and bulls grow mute, Americans are called to rouse themselves from a consumption-induced daze and start saving and investing rather than borrowing and splurging. At about this time in the economic cycle, we hear a lot more from Warren Buffett and a lot less from Donald Trump.
Well, that's one good thing, anyway. (Maybe the Apprentice will be shown clipping coupons this season, and Team A will point a finger at Team B and say, they bought the toilet tissue that wasn't on sale!) The article poses the hope that the current economy crisis will somewhat swing the pendulum back to savings from the spendthrifty ways of the past many years? Since the last recession, I suppose. But he also makes time to drop the hoary "wisdom" that thrift is bad for the economy:
Clearly, we need to save more. But as John Maynard Keynes taught us, thrift can be counterproductive in times of weak demand. Consumer activity accounts for about 70 percent of economic activity. Spending money heedlessly—traveling, redecorating, eating out—keeps our friends and neighbors employed.
Well, not anymore, I guess. Speaking as one who was trying to be frugal when frugal wasn't cool, basing the entire world's economy on the spending habits of lavish Americans is foolish - it is unsustainable, it is unenvironmental, and it is unfair to others who will certainly be tempted to replicate it and then will be told, no you can't, it causes global warming. The economy of the future will have to be based on green technology and the development of renewables, and not on reigniting consumables. Thomas Friedman is quite right about that, and I think Obama thinks that way too, as far as I can tell.

And finally, here is the most foolish sentence I have read in a while, from that bastion of inconceivable overconsumption, the Times Sunday Style section:
In an economic climate in which buying a handbag with a four- or five-digit price tag is starting to seem gauche, the free-spending style hounds formerly known as “fashionistas” are rebranding themselves.
"Starting to seem gauche" - you like that? Note to the Times: It was always gauche. Just ask Sarah Palin and her Neiman Marcus charge card.

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