The American economy gave up useful productivity for the sake of inventing new and ever more esoteric and innovative ways to gamble on financial instruments - mortgage securities, derivatives and all the rest. The rest of it was sent overseas. This gives 25 year olds on Wall Street a good living and a lot of CEOs ridiculous packages of salary and benefits but doesn't do *&%$ for the rest of us. Then when the whole contrivance goes belly up, as anyone looking at this from any other venue than from the pages of the Wall Street Journal could have seen coming - guess who gets to pay for it all? You watch - the stock prices of all the remaining banks and brokerage houses will go up in the next few days, because every bad loan on their rolls will be foisted on the rest of us as part of this bailout.
We've been neglecting our infrastructure for 30 years - and it takes bridges falling into rivers to get anyone to spend any money on it. It's clear we need to spend significant amounts of money on roads, bridges, railroads, green and renewable energy etc., and just before the election that may finally allow this to happen, lo and behold, we "have to" spend three quarters of a trillion dollars bailing out Wall Street. So guess what - the money for infrastructure won't be there. I guess flushing the money down the toilet in Iraq wasn't enough for these people.
But dare suggest raising taxes and it's a criminal offense. It all goes on the credit card. If this is really so important, isn't it worth, you know, actually paying for it?
The next time you hear anyone talk about "values" or the cosmetic habits of farm animals, just remember - three quarters of a trillion dollars going to make sure that Mr. Potter's contemporary equivalent doesn't have to sell his fifth house.
Saturday, September 20, 2008
Thursday, September 18, 2008
Ad Avoidance
Take a look at this one, from Get Rich Slowly. It's about advertising - its pervasiveness, and the avoidance thereof - which is one of the things I'm always going on about.
I saw a study somewhere that says that even people who think they are avoiding or not paying attention to or not affected by advertising, in fact are all of those things. Susan Linn said that children can name brand logos before they can read.
I've often looked through the Sunday New York Times, which I love, and seen all the ads for all the high end designers, high end real estate, etc. and thought - how much can this "liberal" paper call attention to class or income distribution issues if so much of its income depends on high end advertising?
And avoiding television helps, but marketers are smarter than that - that's why there's advertising in magazines, on billboards, and on every website you (and your kids) see - except this one!
And remember rule 1 - don't buy anything you see advertised on television!
I saw a study somewhere that says that even people who think they are avoiding or not paying attention to or not affected by advertising, in fact are all of those things. Susan Linn said that children can name brand logos before they can read.
I've often looked through the Sunday New York Times, which I love, and seen all the ads for all the high end designers, high end real estate, etc. and thought - how much can this "liberal" paper call attention to class or income distribution issues if so much of its income depends on high end advertising?
And avoiding television helps, but marketers are smarter than that - that's why there's advertising in magazines, on billboards, and on every website you (and your kids) see - except this one!
And remember rule 1 - don't buy anything you see advertised on television!
House of Horrors
The situation with the house in Illinois finally seems to be coming to an end. When last we checked in, the bank had done an appraisal that drastically overvalued the house, by about $30,000, and based on that had turned down the latest short sale offer. Soon after that, the lawyer who was working on it told us that she was going to ask them to have another appraisal done, because the first one was so ridiculous, but that we had to pay for it. My brother-in-law, our main financial Smart Guy, advised us to do it, saying that selling short, even after being in default for a year, was a lot better than foreclosure. "It's a small investment with a potentially big upside" is how he put it.
So we put $475 on the credit card for that, but he was right, because lo-and-behold, the appraisal came back at a whopping $50,000 less than the other one (and $25K less than we paid for the house, which sounds about right, given the market). That was about a month ago. Then the bank had to have it explained to them why there was such a great disparity between the two appraisals, and that took awhile (the appraisal company explained it based on a misinterpretation of the square-footage of the house by the first appraiser). Now we're just waiting, supposedly, for the last guy at the bank to put his initials on the agreement. And it's really the last minute, because the foreclosure sale is scheduled for next week!
The one thing I don't think I've said before is that we had a second mortgage on the house, from the synagogue, which lent us money in the hopes that we would stay there a long time - ha ha. (They kicked me to the curb after the first contract.) If the house had sold everything would have been fine but it didn't, and in a short sale situation they have to be enticed to release their lien. So we had to offer them a settlement; we offered about 10% of what we owed, which they accepted because, we speculate, the situation is embarrassing to them. About the kindest thing I I can bring myself to say is that I'm sure it wasn't their intention to ruin us financially, even though that's what ended up happening. If the house forecloses that lien isn't covered and they could still sue me; I don't really want to give them $5K to watch the house foreclose, but that's a bridge I'll have to cross when I get to it.
Now (if everything goes "well") I have to come up with 5 grand which, if you've been paying attention, I don't have. By next week. Fortunately we have some relatives who actually don't live paycheck to paycheck - can you imagine? - and they've promised to help us out. So there's another debt to add to the pile. But - and I say this much more in weariness than in any kind of happiness - it looks like the albatross will be off our necks, one way or the other, by the end of next week. Famous last words, as I know better than anyone.
So we put $475 on the credit card for that, but he was right, because lo-and-behold, the appraisal came back at a whopping $50,000 less than the other one (and $25K less than we paid for the house, which sounds about right, given the market). That was about a month ago. Then the bank had to have it explained to them why there was such a great disparity between the two appraisals, and that took awhile (the appraisal company explained it based on a misinterpretation of the square-footage of the house by the first appraiser). Now we're just waiting, supposedly, for the last guy at the bank to put his initials on the agreement. And it's really the last minute, because the foreclosure sale is scheduled for next week!
The one thing I don't think I've said before is that we had a second mortgage on the house, from the synagogue, which lent us money in the hopes that we would stay there a long time - ha ha. (They kicked me to the curb after the first contract.) If the house had sold everything would have been fine but it didn't, and in a short sale situation they have to be enticed to release their lien. So we had to offer them a settlement; we offered about 10% of what we owed, which they accepted because, we speculate, the situation is embarrassing to them. About the kindest thing I I can bring myself to say is that I'm sure it wasn't their intention to ruin us financially, even though that's what ended up happening. If the house forecloses that lien isn't covered and they could still sue me; I don't really want to give them $5K to watch the house foreclose, but that's a bridge I'll have to cross when I get to it.
Now (if everything goes "well") I have to come up with 5 grand which, if you've been paying attention, I don't have. By next week. Fortunately we have some relatives who actually don't live paycheck to paycheck - can you imagine? - and they've promised to help us out. So there's another debt to add to the pile. But - and I say this much more in weariness than in any kind of happiness - it looks like the albatross will be off our necks, one way or the other, by the end of next week. Famous last words, as I know better than anyone.
Wednesday, September 17, 2008
Budget woes
A continuing sore subject is DW's and my inability to stick to the budget. I've written before about our challenges in feeding our family of 5 for anything resembling (at least to my mind) a reasonable amount. (I set $450 as a goal but we have a hard time getting through a month spending less than $900, which to me seems crazy.) DW also has a tendency to say, well, we need this and this and that, and run to the store and get it, despite where we are in the month or the budget or whatever. (Although she won't do it if I jump up and down and say we really don't have any money.) The latest one was we got her Visa bill today, we're supposedly trying not to use them but every month on her card there's a $100 or $150 charge from Target for school supplies or clothes for the kids or whatever. We've really been making an effort to pay the cards down but of course we can't do it if I make a $200 payment and she spends $150 on school clothes! Her answer is, well, the kids needed clothes, what was I supposed to do? Well, that's fine, but the money you're using is not real money, and it's interfering with our ability to dig ourselves out of our hole.
Much as I would love to rake her over the coals on this, I really can't because a) she reads the blog and b) I have my own things I spend money on, like the farmer's market and the free range meat guy and building up the liquor cabinet. I have virtually given up spending money in bookstores, not completely but mostly, and I pay cash when I do go. But I am far from a saint on this. Jako got $120 out of me yesterday, it'll last 2 months but still.
I think what we may have to try is to stop using, not only the credit cards, but even the debit cards. I read somewhere on one of the frugal sites that if you carry around the cash with you you're more likely to stick to the budget. So maybe we'll have to try that.
Much as I would love to rake her over the coals on this, I really can't because a) she reads the blog and b) I have my own things I spend money on, like the farmer's market and the free range meat guy and building up the liquor cabinet. I have virtually given up spending money in bookstores, not completely but mostly, and I pay cash when I do go. But I am far from a saint on this. Jako got $120 out of me yesterday, it'll last 2 months but still.
I think what we may have to try is to stop using, not only the credit cards, but even the debit cards. I read somewhere on one of the frugal sites that if you carry around the cash with you you're more likely to stick to the budget. So maybe we'll have to try that.
Prada-ganda
Article in Newsweek this week on "what to do when you kids want to dress like TV stars." This goes into the category of "helping your kids withstand peer pressure" which is a very sensititve subject with a lot of people. Our approach on this is multifold: we still have young kids, and they haven't quite realized yet what cool is. We use what the article considers one of the most effective approaches, which is to tell the kids, "We can't afford it," which in our case has the added advantage of being true. We're also very restrictive with TV to prevent some of this wantism, and what TV they do watch is accompanied by incessant propagandizing on our parts against anything they see advertised. (Rule of thumb #1 - Don't buy things that are advertised on television! You stay away from a lot of crud this way.) Of course this would be of only limited use if "all the other kids are wearing it". Our kids' school has a school uniform requirement, which also helps, but the middle school doesn't, so I expect to be more challenged on this front in the coming years. And this is Wichita, and not Manhattan, LA or the North Shore of Chicago. So the expectations are, I think, slightly more down-to-earth. At least, I hope so.
Monday, September 15, 2008
R"H resources
From the indispensible Jew and Carrot blog, a list of healthy and sustainable Rosh Hashanah resources. The one that struck my eye was the mention of raw honey, which I've been getting from Jako for about six months now. He apparently has apples available now as well. Hmmm....
Tuesday, September 9, 2008
Simple self-reflection
The High Holy Days are a couple of weeks away. This is the time of year for self-reflection, for comparing the values we profess to the way we actually live our lives. The goal here is not self-recrimination, but to take stock of where we are and to make some effort to bring our beliefs and our behaviors into some better alignment.
Here are some questions, from a simplicity perspective, that might help guide that introspection. Some of the questions have options, this is because no one's goals are exactly the same. If none of the options fit the way you would aspire to live your life, go ahead and put yours there. This is a guide, not written in the proverbial stone. There are 10 to start (nice round number, very popular in the tradition); if I think of any others I will post them:
1 - Do I have the right balance between work and home? Do I get to eat dinner with my family at least (two / four / six) nights a week? Is all my time with kids / partner in the car, or do I have face to face, conversation, do-nothing time with them as well? Are my kids' activities overwhelming the family? Remember - kids need simplicity too!
2 - Am I eating healthfully, and mindfully? Do I eat at home most nights? Am I growing my own food or purchasing it locally, as much as possible? Am I staying away from processed foods? Do I limit my intake of fast food and junk food? Do I eat enough fruit and vegetables?
3 - Further on eating: Am I eating in accordance with what I know about how food is produced and distributed? Do I still buy factory-farmed meat, dairy products and eggs even though I know quite well how the animals are treated?
4 - Am I setting aside a Shabbat, a sabbath that is a break from work, the computer, the television? Do I set aside time each week for reflection /quiet reading / prayer?
5 - Is television/the internet my main leisure activity, or do I set aside time for exercise, for continued learning and growth, for time with friends, for volunteering?
6 - Have I put my credit cards away, or am I still using them for convenience / when I want something I can't afford to pay cash for? Have I made an effort / plan to retire my debt? Do I have sufficient emergency savings? Am I fully utilizing my employers' retirement fund match?
7 - What kind of consumer products am I still buying? Do I really need that new(whatever it is) that I've just bought / have my eye on?
8 - Do I buy things to make myself feel better, or to express love to my loved ones? Can I find any better ways to do those things?
9 - Am I reusing / recycling / composting as much as possible? Do I keep in mind, when purchasing a new product, where the old one is going to go, and where the packaging of the new one is going to go?
10 - Am I giving sufficiently to tzedakah? (3 % is the lower limit on that, I would say, 5% is better.) Am I supporting my church/synagogue, federation, food bank? Am I volunteering my time, and how much? Are my kids seeing how important giving / volunteering is from my actions?
Again, the point here is the (gently) bring our actions into alignment with our intention. I don't really use the language of "sin", but I would say that if you're really living in flagrant contradiction to your deeper values (if you work in an exploitative industry, say) then that's a place where the language of "sin" may be appropriate, and where some deeper reflection, and possibly more radical changes, may need to be made.
Here are some questions, from a simplicity perspective, that might help guide that introspection. Some of the questions have options, this is because no one's goals are exactly the same. If none of the options fit the way you would aspire to live your life, go ahead and put yours there. This is a guide, not written in the proverbial stone. There are 10 to start (nice round number, very popular in the tradition); if I think of any others I will post them:
1 - Do I have the right balance between work and home? Do I get to eat dinner with my family at least (two / four / six) nights a week? Is all my time with kids / partner in the car, or do I have face to face, conversation, do-nothing time with them as well? Are my kids' activities overwhelming the family? Remember - kids need simplicity too!
2 - Am I eating healthfully, and mindfully? Do I eat at home most nights? Am I growing my own food or purchasing it locally, as much as possible? Am I staying away from processed foods? Do I limit my intake of fast food and junk food? Do I eat enough fruit and vegetables?
3 - Further on eating: Am I eating in accordance with what I know about how food is produced and distributed? Do I still buy factory-farmed meat, dairy products and eggs even though I know quite well how the animals are treated?
4 - Am I setting aside a Shabbat, a sabbath that is a break from work, the computer, the television? Do I set aside time each week for reflection /quiet reading / prayer?
5 - Is television/the internet my main leisure activity, or do I set aside time for exercise, for continued learning and growth, for time with friends, for volunteering?
6 - Have I put my credit cards away, or am I still using them for convenience / when I want something I can't afford to pay cash for? Have I made an effort / plan to retire my debt? Do I have sufficient emergency savings? Am I fully utilizing my employers' retirement fund match?
7 - What kind of consumer products am I still buying? Do I really need that new
8 - Do I buy things to make myself feel better, or to express love to my loved ones? Can I find any better ways to do those things?
9 - Am I reusing / recycling / composting as much as possible? Do I keep in mind, when purchasing a new product, where the old one is going to go, and where the packaging of the new one is going to go?
10 - Am I giving sufficiently to tzedakah? (3 % is the lower limit on that, I would say, 5% is better.) Am I supporting my church/synagogue, federation, food bank? Am I volunteering my time, and how much? Are my kids seeing how important giving / volunteering is from my actions?
Again, the point here is the (gently) bring our actions into alignment with our intention. I don't really use the language of "sin", but I would say that if you're really living in flagrant contradiction to your deeper values (if you work in an exploitative industry, say) then that's a place where the language of "sin" may be appropriate, and where some deeper reflection, and possibly more radical changes, may need to be made.
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