A Celebration Of Consumerism

Once again, Thanksgiving is upon us. A day of gluttony, friends and family. And even better is the fact that its followed by Black Friday, named because its the day that retailers finally show a profit for the year (or so the story goes).

Once again, I’ll be hounded by friends to replace my perfectly good 19″ TV with a new-fangled 46″ Plasma Hi-Definition TV. (Of course, most of them are too dumb to realize that they need HD cable in order to get the best picture so instead they’ve spent $1500+ on a TV with worse clarity than my 10 year old analog TV).

The only problem I have with buying such an expensive TV is that I’ll be forced to watch the the damn thing. Right now I have more important things to do and its so easy to get sucked into wasting your whole evening veggetating (or rather rotting) in front of the telly.

I got suckered into a Russ Whitney seminar many years ago. The only thing I learnt from it was that broke people always have “big-ass TVs with all the channels”. Best $4,950 I ever spent. Ahem.

I went to meet one of my tenants two years ago. I had been renting out the place for a year and had never seen it. (mainly because it was about 970 miles away). He had 2 nice new cars parked out front. My rental looked like a model home with luxurious furniture, and paintings and candles in the bathrooms. He also had a HUGE TV. It was at least 6 ft wide. Damn, the dude lived so much better than I did (and do). But he also couldn’t afford to buy the $180,000 house he was living in, despite making more than his landlord (thats yours truly). And he never got around to figuring out how he could save thousands in taxes and rent by owning instead of renting. He just lived paycheck to paycheck, until he fell behind and I had to evict him. (Actually I very nicely told him to move out, and for once, it was a painless eviction).

But getting back to the story, the fancier the TV, the more you’re inclined to make use of it. And it results in you spending less time living life and more time watching someone else live it for you. Not only that, but you’re bombarded with ads every 5 minutes trying to sell you crap you don’t need. (Or atleast you thought you didn’t need until you were exposed to it repeatedly during the evening). I once calculated that ads account for about a third of all viewing time, so thats another huge drain on your time.

And right now they’re showing ads for day-after-thanksgiving sales that start at fricking 4 am. Who in their right mind would get up on a cold autumn/winter day to buy the same crap they can buy 3 hours later? I know that with the economy contracting, retailers are hurting, but do they think that if the stores are open twice as long, sales will actually double? I think the morons who came up with that idea should be flogged. Twice. Once before thanksgiving and once the day after.

Doesn’t mean I won’t be buying my fair share of crap on Friday. (hey, someone needs to fuel our consumer-spending-driven economy). But it’ll probably be more of the essentials that I’ve been putting off getting so I can get them at a discount. I might even get a Wii, if I can get it under $150. But I’ll probably leave the big-screen TV off my list until Feb 2009.

Ok, thats enough rant for this evening. Happy Thanksgiving everyone!

Gimme My $1.395 Million Back!

I know for a fact that I’m not going to get my share of Social Security and I don’t even have a choice whether I want to contribute or not.  But how much will my share be?

Lets assuming the average person makes $50,000 a year for 35 years. Even though most people start working with they’re 16 and keep working until they’re 65, we’ll exclude the first 14 years when they may not be making a lot. We’ll also ignore the effects of inflation and salary increases to keep the math simple.

Considering that Social Security taxes (FICA and Medicaid) are ~15%, (even if you’re an employee andd only pay half of that, its a cost to your company that results in a lower salary to you) that comes out to $7,500 per year.  Considering the savings could have been invested in the stock market at 8%, the total comes to a whopping $1,395,766.11.

But the Government doesn’t have enough to pay out the baby boomers through the end of the next decade. So I’m sure I’m not going to get of my Social Security checks in 30+ years.

I think the government should privatize Social Security and create individual accounts for everyone. Or atleast stop taxing me and let me figure out my own retirement!

To see the opinions of various  presidential candiates regarding Social Security, check out this link. And please vote for Ron Paul if you’d like the president to be someone who realizes that we’re bankrupt and the monetary system needs to be fixed.

Can’t Stop Global Warming!

From the Yahoo message boards for James River Coal Company (JRCC), which I had sold some naked puts on a few months ago, by some poster named Ross_Perot4President

I just farted a real loud wet one…..I just contributed to global warming….

Whoops, I just barbecued some ribs…..more global warming…

I just opened up a beer (i.e. a carbonated beverage), I just contributed to global warming.

I just let out a big friggin belch (methane gas — holy @#$%, I just killed a tribe of pygmies tied to global warming)

I turned on the faucet to run water, the water treatment plant runs a generator which emits carbon fumes…..

I just turned on the lights which in turn comes from the electricity plants which spew carbon stuff

I just watched that Fat Bitch Rosie ODonnell on TV, her Fat mouth just spews greenhouse emmissions as well as rancid spew

I just watched Hillary Clinton on TV, the clothes she wears come from farm animals which intoxicate the atmosphere with methane gas and toxic emmissions, and her face comes from Satan’s bunghole.

I guess its safe to say anything you do in American life spews some form of carbon dioxide. Maybe if we stop killing the rain forest and stop ugly people from breeding we can stop carbon from spewing onto the planetary surface

Until then, I will burp, fart, barbecue, run my water, heat my house, use electricity, and hate stupid liberals who think they know what’s best for me — they can shove it up their methane spewing asses.

Of course, if you’re Al Gore, you might think you can solve the problem by taxing various businesses. Of course, Al Gore doesn’t want to solve the issue, he only wants to profit from it.

American’s Better Off Than Ever Before? Yeah Right!

Prof. Perry of economics at the school of Management, University of Michigan has an interesting blog on economics called Carpe Diem, which roughly translated means seize the day. In a recent post, he claims “that despite what many people think, our standard of living is higher now than ever before”.

The evidence he cites is that we’re spending less on food, clothing and shelter than in 1901, and we’re spending less than citizens of “developing countries” like India or China.

We might have a better standard of living than someone in India, a country where nearly 30% of the population currently lives in poverty. Thats nearly 400 million people or MORE than the US’s entire population!!!! How is that comparison relevant? Don’t we measure up to the Canadians, British, French, Swiss, Australian, German or Japanese that we have to resort to comparing ourselves to countries that were either socialist or communist-dictatorships for the past several decades. (Incidentally, India has the only democratically elected communist-party in the world).

Also, I would be highly skeptical of anything the Federal Reserve publishes. Their assertion that the average person spends 18% of their income of housing sounds too small. I think the average person in the US spends about 25-30% on housing (although houses have become bigger and much more comfortable from 1901!).

And another factor to consider is that the average family had only 1 working member in 1901 – the male head of household.

Today you have most family with 2 income earners. So two people are now working, but they’re not living twice as well.

That doesn’t sound like an improvement to me.

However, I do agree on thing, we most undoubted have a better standard of living of anyone who lived in 1901, even maybe robber barons. But I don’t think we’re living better than ever before.

I think the late 1950s was when Americans were the richest. That was when we had a lot of manufacturing jobs and the government wasn’t wasting money on fighting wars in remote places. And the dollar was backed by a precious metal, not just an empty promise.

Video: Cramer Frothing At The Mouth

Here’s an interesting video of Jim Cramer imploring Ben Bernanke to stick his head out of the Fed window and see whats happening in the markets. Pretty amazing for a 52 year old man to get so worked up over a lousy rate hike. I think he might be losing it!

I wouldn’t be surprized if he had an stroke on tv one of these days! Not sure what he was implying when he said that “they” called him off the air imploring him to do something. Were these people he’s referring to bond managers or hedge fund managers? And what is he supposed to do? Call his buddies in the white house or the Fed office and convince them to cut rates? Or was this spectacle it?

Will the Fed cut rates to help the economy?

I think they will pretty soon, but that will weaken the dollar even further (and hopefully strenghten gold). But atleast all those people who couldn’t afford to buy their homes without super-low rates and ultra-lax lending criteria and who are now faced with losing them will be able to continue the farce a little longer.

What do you guys think?

DOW 14,000 – All Time High

The broke the 14,000 level today. Despite Bear Stearns warning that their subprime mortgage hedge fund was worthless and Ben Bernanke stating that the subprime related losses would be in the range of $100 Billion the market was up! It just shrugged off the bad news and went on its merry way.

Interestingly, regarding Bear Stearns, Bloomberg reports “It was Bear Stearns, the biggest broker to hedge funds, that nine years ago declined to join 14 other investment banks in the bailout of Long-Term Capital Management LP. Then last week, as New York-based Bear Stearns pleaded for help to rescue two of its hedge funds teetering on the brink of collapse, many of the same firms refused to come to its aid”. If you’ve never heard of Long Term Capital Management, I suggest you read the very interesting book,
When Genius Failed: The rise and fall of LTCM
. It was basically a hedge fund started by some Nobel prize winners that ended up in smoke.

Going back to the stock market, when the market ignores terrible news and goes up, its usually a sign that the market is very bullish and will continue for a while. Consider that many companies are reporting bad earnings, and the stocks are not being punished.

Motorola (MOT) posted a $28 Million loss and the stock is up. Citizens Republic Bank (CRBC) announced its non-performing loans had quadrupled and it took a $20 Million write-off and its stock jumped up too!

Simply amazing.

At least the Dow Transports ($TRAN) is also hitting new highs along with the Dow Industrials ($INDU). If the TRANs had been lagging, the rally would be suspect.

We have a global credit bubble, a housing disaster in slow motion, a subprime mortgage fiasco, hopelessly underfunded government liabilities, an unsustainable trade deficit, negative U.S. savings rates, a collapsing dollar, oil depletion and creeping inflation, and yet the market is going higher!

Oh well, if you can’t beat them, join them!

How To Become A Chick Magnet For Under $700

If you’re one of those unlucky guys who doesn’t have much luck with the ladies, your luck has now changed. You can now become a total babe magnet for less than $1000. All you need to do is buy an iPhone! [Since writing this article came out, the prices have dropped and you can get an iPhone for a lot less than that.]

According to Cliff Mason of TheStreet.com, its the best $600 he’s ever wasted.

As soon as she gets her hands on the thing, the cashier next to her catches sight of it and flashes me a look of what I can only describe as sheer ecstasy before asking if she, too, can take a look. When the two women on either side of me and the one in line behind me realized there was an iPhone owner in their midst, they reacted like I was one of the Beatles, circa 1964.

Maybe I’m embellishing a bit, but not much. It is true that within that five-minute period, more women tried to make more small talk with me than at any time in the last four or five years.

Further, he justifies its high price tag too.

People compare the price of the iPhone to the much lower price of a BlackBerry or a Treo and conclude that the $600 price tag is way too expensive. They’re using the wrong comparison. We should be comparing the iPhone with plastic surgery. What’s $600 compared to the $6,000 you might pay for a tummy tuck, or the $8,000 many will pay for a face-lift?

So if any of you are looking for a good excuse to buy an Iphone, this is probably the best one. You can read about it in his own words here.
[Picture of Jenna Jameson on an Iphone]

Eight Random Facts About Living Off Dividends

Super Saver over at My Wealth Builder has tagged me in a new blog project. This project calls for sharing 8 personal facts about myself, then tagging 8 other bloggers to do the same. Here are the rules , which were passed to me:

* Each player must post these rules first.

* Each player starts with eight random facts/habits about themselves.

* People who are tagged need to write on their own blog about their eight things and post these rules.

* At the end of your blog, you need to choose eight people to get tagged and list their names.

* Don’t forget to leave them a comment telling them they’re tagged, and to read your blog.

Eight Random Facts

1. I’ve lived on 3 different continents for significant amounts of time.

2. Even though I’m an engineer, I hate how gadgets have overtaken our lives. I resisted for years before getting a cellphone.

3. My watch costs more than my first car.

4. I’ll probably drive my car until it has 200,000 miles on it. I stubbornly resisted all efforts by my wife to give it to her and get myself a new one.

5. I’m incapable of explaining to a barber(ok, a hair dresser) how I’d like my hair cut.

6. I think at some point in my life I’ll move to either Australia or New Zealand and live there for a few years.

7. Thailand is my favorite place in the whole world to vacation.

8. I can’t stand people who do stupid things because they’re too lazy to do any research.

And finally I’m tagging 8 more bloggers (who hopefully haven’t been tagged).

Moomin Valley
Live Learn Invest
Well Heeled: 20 Something Money
The Dividend Guy
The Wealth Junkie
DINKs Finance
The Corner Office
Lazy Man and Money

China Executes FDA Chief

In case you didn’t hear, China executed its FDA chief today. The had sentenced him to death just over a month ago. And instead of waiting for 10 years to exhaust the appeals, they just killed him and put an end to the story.

In one fell swoop, China just reduced the average life expectancy for its FDA chiefs!

[source: http://www.newstarget.com/021930.html]