Economists fear consumers may start spending within their means

Here's a depressing AP article about consumer borrowing habits. The Christmas shopping season is already upon us, with retailers begging you to come in and spend money you don't have. Home equity loans are dried up, leaving credit cards as the most accessible way to borrow your way into oblivion. As a result, revolving credit debt is up-up-up! That's not really what depresses me. What upsets me is that the "experts" out there, the economists, whoever they are, are completely happy with the outcome.

Now that Americans have sucked all the equity out of their home, they're diving right into higher-interest debt, with the credit card industry. It's kind of like jumping out of a pool with a couple sharks and into a pool with a dozen piranhas.

During the housing boom, when home sales were hitting records for five consecutive years and prices were soaring, many homeowners tapped the rising value of their homes to finance increased spending by taking out home equity lines of credit.

However, now that home sales are plunging and double-digit increases in housing costs are a thing of the past, home equity lines of credit have become less available. That has pushed consumers back to credit cards to finance their spending.

Hey, heaven forbid people start spending within their means. Let's increase spending even though we aren't increasing income. Let's fuel big companies by borrowing more money. Here's a question, brilliant economists: What are we supposed to do after the home equity has dried up and the credit cards are maxed out? How exactly will we still be fueling economy when we're all freaking broke and three-quarters of our paychecks are getting sucked up by interest charges?

Analysts are watching closely to see if the steepest slump in housing in 16 years could have a more serious impact on the economy through the wealth effect

I had no idea what the wealth effect was so I looked it up.

One problem, home values don't make you more or less wealthy unless you plan on selling the house and living on the street. Instead we get this "perception" of wealth by letting people take out loans.

the fear is that falling home values could cause consumers to cut back on their purchases. Since consumer spending accounts for two-thirds of total economic activity, any serious cutback in spending could lead to much slower economic growth.

GOOD! Fear? Are these experts idiots? How does it help our economy if we're all broke! People need to start paying off their debts and living within their means. Then when they have real capital they can go spend it.

FRB G.19 Release

The Black Death of the 21st Century

Here's an interesting article from MSN about a recent trend showing up in the wake of recent foreclosures. Mrs Rossman sums it up perfectly (emphasis on the two conflicting concepts added by me):

They opted to let their mortgage payments go while keeping current on all their cards. "I would rather be late on one thing than on several things," said Rossman, who works at a local church, pointing to the "very high interest rates" on their cards and the need to keep accessing credit. "But we can't just incur debt forever," Rossman, 24, also acknowledges. "We're cutting coupons, eating very cheaply and doing everything we can to stay within the budget."

Mrs Rossman gets an F for logic; better to not pay your mortgage than not pay your 6 credit cards. Late on 6 debts is worse than being late on 1 debt right? You are reading this right. This family (with a new baby no less) has decided to stop paying for their house so they can keep current on their credit cards. Why? Because they need them, and they can't stop spending.

The proliferation of no-money-down home loans over the past few years, coupled with the current housing downturn, is giving rise to a new mentality: People will risk losing their homes while doing everything to keep their credit cards.

Credit card companies are ecstatic, of course, because not only does this ensure more profit at the expense of the consumer's security but it opens a whole new market for them. Yes, right when we have ample evidence (via massive foreclosures) that lending money to people with sloppy credit or little income is a bad idea, credit card companies are targeting just that demographic.

As people such as Delana Dowdy in Darby, Mont., found out, falling home prices and tightening credit have made it harder to withdraw home equity to pay off debts such as credit card bills.

"The appraised value (of the house) didn't come high enough to consolidate our bills," said Dowdy, 36, who runs an antique store. Right now, she's behind on both her mortgage payment and card bills.

See, it never occurred to these people to just stop spending beyond their means, they are disappointed that they couldn't sign up for a new loan with some nice home equity to pay off their existing debt. As if that would be some kind of solution?

Teesa Rossman and her husband bought their house for about $135,000 two years ago with no money down. But a subsequent -- though temporary -- job loss and the birth of their first child have strained the Rockford, Ill., family's finances in recent months. Just last month, the couple found it impossible to pay all their bills and had to choose between making payments on their mortgage or their credit cards.

Why would you choose to keep a credit card company happy (and fat) rather than pay for your home? What will they do when they come home and find the locks changed and all their stuff on the sidewalk being picked through by their neighbors?

I have a reason. The same reason why a homeless man will buy a bottle of booze instead of a sandwich. Addiction. The people mentioned in this article and those like them are addicted to credit. They are addicted to creating their own lifestyle regardless of the cost, they are addicted to the materialism and the consumption of "stuff". Spending money makes them feel good, makes them feel successful, and gives them a false sense of security. What happens, then, is the music stops and they are scrambling for a chair, clipping coupons and eating Ramen noodles, but the one thing that put them in this situation - their insatiable need for credit - is the one thing they can't live without.

Credit addiction is the Black Death of the 21st century.

Newflash: When you borrow money you have to pay it back

What do economists think of the recent credit squeeze? Everyone is waiting for the rising foreclosures and sinking bad debts to trickle down to everyday consumers. Will we experience another depression? Will bread cost $10 a loaf?

"For the past 25 years, America has experienced a period of rising consumer debt," said Steven Fazzari, an economics professor at Washington University in St. Louis. "Up to now the high debt levels have had a positive influence on the economy. In fact, it was a stimulus to economic growth. But now it's likely to become a source of economic contraction."

How is increasing debt a positive influence on the economy? Sure, if you double your income by borrowing money you don't have, you can spend more. Is that good for the economy? Ask a marathon runner if it's a good idea to drink a gallon of coffee and start out in a blistering fast run.

"Our research suggests that we're facing a much more serious problem due to our consumption habits, that could have a much bigger impact,"

When you think about everyone who refinanced in order to cash out equity in their homes, they have been spending money that they didn't really have. Now their equity is gone, they can't pay back their loan, and the supply for their spending surplus is dried out. Now they have to live on their income alone, plus pay hefty monthly payments on all that debt they accumulated. It's no wonder they won't be spending much elsewhere.

"What will people do when offers for new credit cards don't show up in the mail three times a week? People won't be able to simply pay off old loans with new lines of credit. They'll be forced to service their debt, if they can."

Perish the thought.

At what point should magazines be paying us?

I have decided not to renew my subscription to Parenting Magazine. Though we do not have any kids, I thought it would be a good idea to subscribe for various reasons, one being that we wanted some magazines for weekend morning reading material. Money Magazine was among my initial purchase, but that also will not be renewed. The articles in it are fairly fluffy and although sometimes entertaining, there is far more useful information elsewhere.

Anyway, the reason that I will not be renewing Parenting is that it not only contains very few real parenting tips, but it is almost entirely a mechanism of product advertisement. All magazines have ads, but even the articles in Parenting are usually little more than cleverly disguised product placements. Nearly every "solution" in any article involves the purchase of some commercial product. Even the recipes, which should be fairly inoculous, suspiciously include brand names or processed/frozen goods.

I can ignore the blatant disregard for the male role in parenting in this magazine, and the frequently useless (and rare) male-focused article and the general tone of the entire publication that men do little to nothing in the way of child rearing, making way for "super mom" because as my wife says they are just embracing the stereotype.

I can ignore it because the entire magazine is insulting. When they are not hawking merchandise and "must have" lists that are overflowing with junk that no practical parent could ever possibly need they are filling pages with reader-contributed materials and common-sense tips. Apart from actually putting all the material together, I am at a loss to figure out what content the editors actually produce. I feel violated that I have essentially paid to be advertised to while trying to trick me into believing they are delivering original and useful information.

This magazine, and others like it, should just be made available on the free rack.

How to ruin a household brand name

I have discovered 5 easy steps to taking a million dollar brand name and run it into the ground so it not only loses credibility, but becomes synonymous with the exact opposite of its original intention.

• Step 1: Create a fantastic concept and sweep it nationwide. Base your concept on giving folks tips on making beautiful household decorations, foods, and crafts out of everyday items. Become so popular that your very name brings to mind a do-it-yourself can-do attitude and quality and sophistication. Be the model by which all domestics aspire to.
  
• Step 2: After your reputation is established, begin licensing your name to mass produced merchandise sold in big box stores known for low quality cheap goods sold largely to low income markets. Add a shred of credibility to the project by at least selecting colors, patterns, and themes.
  
• Step 3: Abandon the DIY attitude and focus on themes that encourage people to buy more mass produced products instead of making things on their own with everyday household items.
  
• Step 4: Overprice these goods so that the low income market they are catering to will not want to buy them, and the high class market that they would appeal to won't have them available because they are sold in stores that they wouldn't step foot in.
  
• Step 5: Abandon all pretense of class by taking an existing product already in popular and in mass production and slap a label with your name on it and jack up the price for no apparent reason.

As a big wine drinker, I am appalled that Martha Stewart is "rebranding" Ernest & Gallo wine. Not only does Martha bring nothing to the wine business by doing this, but she has yet again chosen a product that is known for it's cheap availability. She could have only done worse by putting her face on a box of white zinfandel.

It is sad that Martha Stewart, who was once the "diva of all things domestic" has become a poster child for commercialization and brand consumerism. I would probably try Martha Stewart wine if it wasn't for one important thing, she doesn't have a vineyard, so Martha Stewart Wine really doesn't mean anything.

The good news is that if you already enjoy Ernest & Gallo, you're already drinking her "new" vintage.

The advertising bombardment

Ads are everywhere. They are so pervasive that most of the time we register a product, brand, or message without even paying attention to the ad itself. I am a firm believer that if you want to cut a very large chunk out of your spending, the first thing you should do is stop reading magazines and turn off the TV.

It takes a long time of being unplugged into these consumerism machines before you realize just how insidious they are. Open a magazine and you will likely find more pages of advertising than actual content (remember, you paid them to subject yourself to this). Worse, many of the ads are often disguised as articles. Even some of the genuine articles themselves focus on what products you should buy.

I spent about 2 hours watching television recently, which is more than I've watched in the last 2 months. What struck me most is how very little content is on television anymore. Flip between the channels and you will encounter an advertising bombardment on a mind boggling scale. Liquor ads (that have little to do with liquor and all to do with projecting an image), kids toy ads for electronic gizmos hawked to toddlers as educational, overpriced jewelry on entire channels dedicated to shopping. It's endless. And it's all television is anymore. It's one giant advertisement to get you to spend more of your money. And the shows? Look carefully and you will spot your favorite actor drinking a bottle of Fina or driving a brand new SUV (despite the character being a poor single mom).

Worse, we pay money for more channels of advertising! My opinion? Shut it off.

For more ways to save money, No Credit Needed is hosting a "33 Days and 33 Ways to Save Money" collaboration.

See also: Cable TV gone too far? and Throw out your TV and save.

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Envy thy neighbor

Here's a fun article from MSN about how the wealth around you can make you feel poor. We get to hear a couple of stories, sounding very typical, of young people entering the workforce and finding themselves surrounded by rich, successful people. So what do they do? They spend themselves deep into debt to keep up.

When you hang around people who spend lots of money, you're probably going to do the same (or be miserable that you can't). Odds are also good that it will leave you broke.

it is a daily struggle to keep it from skewing her financial perspective. "I find myself looking at something and saying, 'Oh, it's only $200.' Then I look at my accounts, and I have to remind myself, 'You can't afford $200!'"

Personal finance has a lot to do with perspective. Especially for younger generations, sometimes its hard to focus on what the true value of a dollar is. We grew up with parents who spent, spent, spent. New cars, bigger houses, leveraging loans. What we didn't realize was that many of them weren't saving enough for retirement, were eating up all their equity, were deep in debt, or were just not thinking far into the future.

many of us might hesitate to admit, you strive to buy your way into the lifestyle of Mr. and Mrs. Jones, even when you can't afford it

We want to live like our parents. We want to live like our neighbors living like their parents. But sometimes we forget that as Baby Boomers they were having fewer children later in life, so their careers were already well established. By the time we were preteens our parents were in their peak earning years. That'll really distort the perspective on what's "normal" for a 20-something just out of college.

Adam once worked with a woman who had "lived the good life" but was so broke at age 46 that her parents refinanced their home to bail her out.

The lesson is to watch what you spend and happily accept a lifestyle you can afford. While your friends are all out living it up, will they be happy when they're flat broke and can't retire?

Living like a king - when you're not one

Tricia over at bloggingawaydebt.com recently posted a link to an article in a Kansas newspaper about a couple deep in debt. This couple has 1 kid and a second on the way. They are only 24 and 26 and already in almost $100k of debt. Their total debt, including their mortgage, is $187k.

The question this couple has is

“How can we get caught up with our bills and get our expenses together to start saving?”

and the answer, apparently, is

“Reducing your big tax refunds will almost correct your negative cash flow. But cutting expenses and paying off credit cards will be critical for longer term success.”

What? What kind of useless advice is that? This couple is completely broke and in debt. Adjusting their withholding isn't going to help much. Worse, they sugar coat their situation by claiming a net worth of $24k. But when you look at their "assets", they include $55k of "stuff" and $150k in home value. Though we don't know how they calculated their home value, the market is tanked. And the stuff? I guarantee they could not liquidate everything in their house and raise $55k at a garage sale, unless they have some seriously valuable antiques or collectibles.

How much do you want to bet they have a big plasma screen TV? They have only $1k in actual cash and $1k held up in a retirement account. They have $23,000 in car loans with cars supposedly worth $25k.

I think this family has a problem with living beyond - way beyond their means (all this debt was accumulated before they were making $60k/yr, and she has yet to finish school). Sell the cars and buy small older ones, sell any expensive appliances or electronics, cut up the credit cards (and try to find lower interest balance transfers if their credit isn't already trashed), and forget about saving. You've got a small emergency fund, you have negative net worth, you're still young. Get those credit cards and the personal loan paid off, then start saving a tiny bit for retirement while you attack the student loan. Then save up for a car and buy one with cash. But most importantly, stop living like a king.

$3,000 state voucher to buy a new car

Representatives of the state of Texas feel that the way to curb pollution is to get older cars off the roads. This isn't a bad idea, but I'm not so sure about the way they are doing it. I've discovered other states, Vermont specifically, have offered this as well.

Here's how the program works. Say you are a family of 4 with a pre-1996 vehicle. If your annual income is less than $41k, you qualify. You can take your old car to a dealership where you can get a $3,000 voucher towards the purchase of a new or 3 year old used vehicle. The dealers get no money for your trade, which is given to a salvage yard at no cost, and there is no indication that the dealer offers any trade in value other than the state sponsored voucher.

You can then use that voucher to purchase a 2004 and up car or light truck.

Here's the problem. The cheapest 2004 vehicle in the state of Texas (from autotrader.com) is $4,500 plus TT&L (remember this is a dealer, so you will likely be paying many fees on top of the asking price). A small number of cars in this year range are below $10k. Most are above. The maximum you can buy is a $25k vehicle. The very idea that a family of 4 making less than $41k a year should go out and buy a brand new car is absurd, but at least they allow used.

Regardless, it is more than likely that the family is going to have to take out a loan to get this new vehicle. I find it incredible that the state is encouraging people with low incomes to go out and buy brand new cars by dangling a check for $3,000 in front of them. If they are driving a pre-1996 vehicle, isn't it safe to assume that they can't afford a new car to begin with? Is $3k going to make any difference? Is the state of Texas encouraging debt? Will the state of Texas help them if their car is repossessed because they can't make the payments?

In reality, the people who will most likely take advantage of this is people who were already planning to trade in their clunker for a newer vehicle, or were planning to. Thus, we have a state funded car purchase - the funds for this program were collected by raising vehicle registration rates.

Have $80 million to spare? Buy a sub

No, it's not an expensive sandwich. For only $80 million dollars (a bargain if you ask me) you can have your own luxury 5,000 square foot submarine. Expect your friends to trade in their private yachts for one of these in the near future. If you don't have at least the base model, which starts at $25 million, please don't bother showing your face at the billionaire's country club.

Each sub comes with a custom interior, extravagant viewing windows, and even a carport to park your Bugatti and a minisub that you can take afternoon jaunts in.

Sales information is not known, but there's a good chance this guy has one. Nothing says "living off the backs of stockholders" like buying a submarine with your $200 million severance package after 5 years of doing a mediocre job. If you can't afford it, chances are good that American Home Mortgage will lend you the money.

Torpedoes not included.

Broke making $150k a year

Here's a depressing story from CNN about a couple with 4 kids who are now neck deep in debt and broke. They had 1 kid, planned on having a second and instead had triplets (another reason not to use fertility drugs!).

The real tragedy of this story though is that they had $175k in savings and an income of $90k a year entirely from one spouse. After their triplets came, their savings vanished and they went into debt. I wondered how 3 healthy babies could drain $175k in such a short time when you have $90k a year in income and a stay at home mom!

Now 4 kids is a lot. But many families have more and make it just fine. Yet this couple was spending $2k a month on 3 part time caregivers! Then they had real estate investments, which began to become unprofitable (or even break even). In 2 years they went from $90k a year and $175k in the bank to over $155k in DEBT plus a loss of the $175. 3 extra kids had cost this couple $165,000 a year! That's $55,000 PER CHILD.

It gets worse. They sold some giant farm mansion they were building, cashed out some unpaid leave, yet they were still $127k in debt. They worry about paying preschool tuition (are you kidding?) and saving for college. At the same time, the husbands income has increased a large amount and yet they still can't get by!

They should sell all their real estate (ticking time bombs), stop sending the kids to preschool, get rid of all the nannies, stop contributing to the kids college funds, rent a small house, live off of $50k a year and pay off the debt within one year and slowly begin increasing their lifestyle while socking away most of their income. In 5 years they could be better off than when they started.

This couple has about $150k in income and a 12% employer-provided retirement savings, yet they are wallowing in $120k of debt.

Why is this couple in so much trouble? In my opinion, its because they can't admit they're totally broke.

Dennis says he agrees with the advisers that the couple should pay down their debt and create a cash reserve. But he's reluctant to diversify as much as they suggest and wants to keep enough free cash on hand to cut real estate deals. "I'd like to have $75,000 in my foxhole waiting for the next thing to jump up and buy," he says.

There are so many families that have more kids than these folks and live off of a fraction of what they do. This is a perfect example of how money does not create wealth.

Does a credit card make you purchase more?

Do you buy more with a credit card? I was listening to Dave Ramsey the other day and he read off a statistic that McDonald's found customers charging an average of 47% more per ticket when buying with a card vs cash. Other studies showed the figure around 30%. I'm sure its higher for fast food joints. When you are buying a $3 happy meal, it only takes a super-sized fry and an apple pie-thing (do they still sell those?) to knock it up another couple of dollars.

But are we spending more with the card, or are we just spending more per transaction?

I think it depends on the individual. I don't think I fit this statistic. If I have cash, honestly, I'm more likely to spend it. Maybe its a generational thing? My budget is all done electronically. My bank account is my "money". If I have a $10 bill in my wallet, that just feels like extra spending cash. I'm more likely to stop at a convenience store to buy a soda if I have a dollar. If my wallet just has the plastic in it, I'm more likely to just skip the transaction altogether. And when I do purchase on the card, I'm still looking at getting the best value to spend as little as possible. I know at the end of the week, I'll have to deduct whatever I spent from my paycheck. The idea of that hurts more than plunking down some green.

Plus all that change I get back? It goes into a jar. Where does the change in the jar go? 1) The vending machine at work, or 2) The change machine at the grocery store - which charges a percentage of the transaction.

For kicks, here's the article that prompted the discussion. Can credit cards make you fat? Sometimes mainstream media spins just crack me up.

The prada bag of the housing market

This is just too bizarre; KB Martha Stewart homes. Of all the decisions you need to make when purchasing a home, does the fact that it was 'designed' in part by a woman on TV living somewhere on the east coast fall under a high priority?

"I love all her things," says Menyon Green, a 42-year-old nurse who recently bought a Martha Stewart-KB Home in the Atlanta suburb of Fairburn, Ga. "I just knew this was going to be a good subdivision."

What? How do you know it's going to be a good subdivision? I'll admit it, I own a Martha Stewart frying pan. It was on sale and it looked nice. But a house? Whether or not you have a door knocker with Martha Stewart's face molded in bronze on your house doesn't change the fact that it's a KB home - not exactly a builder known for its high quality.

"Right now it's a unique type of offering," says Rita Rodriguez, chief executive of Enterprise IG in the U.S., a brand and design agency. "You can invite someone to your home and say, 'This is a Martha Stewart home.' But if it's replicated and stamped across too many odd markets, the uniqueness can be gone. That cachet and aspiration isn't there, and you just become like everybody else."

Maybe I'm old fashioned, but has it occurred to these builders that instead of signing up celebrities in cross-marketing schemes, they should just offer more than 6-7 floorplans? All the new subdivisions going up are full of houses that look exactly the same, with the exception of some trim there or a colored brick here. They also all use the same "style", brick faces with hardiplank siding. The garage is always on the front, the walkway leading along the side right to the front door, and to the side of it a flat or bay window. Some have brick all around, but none of the two story has all brick (the upper half sides/back are ALWAYS hardiplank) until you start getting into the custom or $750k+ homes.

open kitchens and dining rooms suited for entertaining, plentiful windows to capture natural light and an exterior trim available on some homes that supposedly matches the color of Paul Newman's eyes.

...okay.

Some buyers say they are attracted to the Martha homes because they suggest quality, functionality and class. Others say they expect the homes will have a better resale value than other homes.

Sorry, but the quality of your home is going to depend on the builder, not the designer. This partnership looks like McDonald's selling knockoff prada bags in happy meals. Resale value? How is tying the "designer" aspect of your home to a woman who probably won't be remember 30 years from now help your resale value? Remember, this is supposedly a home that should last 100 years. Do you think anyone then is going to care that it was designed by some celebrity? Martha Stewart never even saw your home, or set foot inside of it. She brainstormed floorplan ideas and color schemes with some team that pulled up 64 plans and started mass producing them.

Interesting:

"It's our version of the iPhone. It illustrates the power of something different with a brand tied to it,"

We're turning whole houses into fads now. Unfortunately, fad and trendy designs tend to hurt resale value in the long run, not help it. Remember all those $100k commercial/industrial stainless steel 800 sq ft kitchens that were all the rage? They're darn hard to sell now. That's what following a fad gets you.

So what ever happened to personal creativity and adding your own personality to your home?

"If I could afford to do it, I would do the whole thing Martha Stewart style," she says. "Matter of fact, I would like her to come to my house and show me how to do it."

So sad.

Out of reality birthdays

This consumerist post about a crummy birthday cake reminded me about a number of parties in my neighborhood for little kids. On any given weekend, you can spot them by the huge inflatable playground in the background, streamers and balloons everywhere, and at one house; a donkey tied to a pole in the front yard.

I'm not concerned with the difference between the photo and the actual visual quality of the cake. But lets look at this cake (the advertised photo - which actually doesn't look realistic anyway, what cake has perfect 90 degree edges like that?). It looks like a pretty amazing cake. It rivals groom cake wedding-cake quality. And it was for a 3 year old. I have photos of my birthday parties, and my cakes were round and smeared in icing with Happy Birthday written on top with those little colored things and maybe a hot wheels car slapped on the top. What kind of unrealistic expectations can we be giving a 3 year old when their cake looks like it was done by Judy Uson? Or they and their friends have a private portable playground with donkey rides? This goes far beyond hiring some drunk in a clown costume to get hit with whipped cream pies.

Take care of your family first

Here is my list of priorities:

1) the family
2) spouse
3) the kids
4) ourselves

And here's an example of some people who have it all mixed up, parents who go wild for their kids.

when it comes to their 2-year-old daughter, the young parents -- she is 21, and he is 23 -- simply can't say no.

Why can't young parents say no to their little kids? Are they putting their kids first? I'd say no. The priorities for those parents in the article goes ME, kids, family (afterthought). They don't want their kids to say "mommy never did that for me". The mom doesn't want to work because her 13 year old daughter "needs her" home 24/7? Are they really thinking of their children, or are they just thinking of themselves?

Living on $30,000 a year, one family ends up moving back in with their parents with credit card debt exceeding their yearly income and $600 party extravaganzas for their two year old. What 2 year old is going to care about a $600 party, and how spoiled will he be when he grows up?

This isn't putting your kids first, its putting yourself first. What 13 year old needs a stay at home mom? And what example is that setting, parents strapped for cash and overspending and mom won't lift a finger to help. These aren't simple parenting "mistakes", they are ongoing damaging lifestyles.

Do what's best for your family. If that means that you have to sell a house you can't afford, work extra jobs, and have kid birthdays with cheap balloons and second hand toys to get out of debt, so be it! By putting what's best for your family first, ignoring your own selfish wants and kids wants (kids don't have the perspective to make rational decisions) you create a stable environment for your children. A $50,000 sweet sixteen bash can't even compete with that.

Earth Day Footprint Calculator

I had long lost track of this site, but found it once again! From EarthDay is a carbon footprint calculator. They call it the "Earth Day Footprint Quiz". You answer a bunch of questions and it tells you, based on how you live your life, how many planets we would need to support everyone to live like you do.

I remember taking this quiz a long time ago, and its a shame I didn't keep the results in some way. It would be interesting to compare them to today.

My results today were:

CATEGORY	ACRES
FOOD	3.7
MOBILITY	2
SHELTER	6.9
GOODS/SERVICES	5.9
TOTAL FOOTPRINT	18
IN COMPARISON, THE AVERAGE ECOLOGICAL FOOTPRINT IN YOUR COUNTRY IS 24 ACRES PER PERSON. WORLDWIDE, THERE EXIST 4.5 BIOLOGICALLY PRODUCTIVE ACRES PER PERSON. IF EVERYONE LIVED LIKE YOU, WE WOULD NEED 4.2 PLANETS.

4.2 planets! Ouch. On the other hand, I'm lower than the average in my country, but does that say anything when I'm essentially comparing myself to my iPhone loving McMansion living Hummer driving McDonalds eating fellow Americans?

Then again, how is it possible to live with only one planet? Apparently you have to be married and live in a house under 500sqft with no running water or electricity, walk to work, grow your own vegetables in your back yard and become a vegan. We really conserve in our house, but I don't think I could sacrifice that much!

Take the test and see how you do!

Consumerism at its best

Here's consumerism and overconsumption at its best.

iPhone cravers

Some people are just dying to get their hands on the new iPhone. They are willing to pay hundreds above the already ridiculous retail price to have it, and they are willing to stand in line for days to be the first to have one. Are we going to see a repeat of the Playstation 3 mess?

No doubt there is a team of advertising marketers somewhere working with Apple patting themselves on the back right now, because pushing people to this level of sheer stupidity is an award-winning accomplishment!

Here are some amusing quotes.

I am looking for several people who will wait in line for me to buy the new Apple iPhone on Friday, June 29...You need to be reliable, mature, and patience will definitely be a plus

I don't think this will get many responses. The problem is that anyone who is mature and patient is going to wait until they can walk in and buy an iPhone, not wait 3 days outside a store.

I am charging approximately $150 over the cost of the iPhone

Some people pride themselves in finding good deals, or buying things on sale, others happily pay significantly more.

It seems like the asking price for people to stand in line is 200-300 dollars (however i have seen offers for 150). but I want to make SURE that i get one, and I'm pretty much willing to pay the 200-300 extra for it

Who is going to stand in line for $300 for 3 days? That ends up being $4.16 an hour.

Ok, so here's the deal. I need an iPhone. Like, really need an iPhone. It's so bad, I've taken to carrying around my paper cut-out just to get used to the size

Here's a corporate executives dream come true. He hasn't even used the product yet, but he is completely obsessed over it.

In any case, the iPhone release is going to be really entertaining. I can't wait to hear the first report of someone paying $1,000 for their iPhone and then accidentally dropping it in the toilet a day later.

A mirror on the cover wasn't enough

Wired magazine is offering a new service. You can now have your own face on the cover of its magazine issue. I have to write it again just so it sinks in. The magazine is personalizing its issues to include your face on the cover.

Ahem. Apparently having a magazine put a mirror on the front so you can look at yourself and say "I'm the best person of the year!" wasn't enough, now we need to have our photos in bold color print. The whole idea was rather silly, but this new venture is a true testament to our growing narcissism. Over 5,000 subscribers went out of their way to submit their photographs to this magazine so they could see themselves on the cover of the next issue.

But I wonder what the point is? No one else is going to see it, unless you drag the issue to work and force your coworkers to look at it. Really, this does nothing but let the subscriber sit in his living room and gaze adoringly at himself on the cover of a magazine.

Of course, the real reason for this is not just to draw us in by stroking our self-loving egos, but to engage the audience in a new kind of magazine; one that is personalized for each subscriber. What will this mean? If you guessed "Advertising" you get a gold star (and a party with a banner that reads "You're special and super smart!"). Its really a brilliant idea. Food companies (especially those that sell frozen processed boxed stuff) advertise heavily in magazines, and there is a huge database of what kind of products you are buying sitting in some grocery stores computer that you have been kindly assisting them in compiling as you swipe your "club card".

The article ends with this:

If your cover is on a national magazine, but only on the issue you receive, does that qualify as your 15 minutes of fame?

No, but at least no one else will know you did it.

Cable TV - Gone too far?

Comcast, apparently, has decided its goal should be to have 400 high-definition channels available by the end of this year. I will assume these are replacing the already 200 channels that are not in high-def rather than adding more. Its long term goal is to have 800 high definition channels by 2008.

While I somehow doubt that Comcast will deliver on its promise of 800 HD channels by 2008, it is telling that Comcast feels delivering it would be welcomed by its customers and highly profitable. I can only imagine it would be, with some cable plans running up to $200.

How much is too much? Assuming they have a program guide like they do now, and I checked the programming in each station at a rate of 1 per second, it would take me over 13 minutes just to see what is on!

Services like what Netflix provides makes more sense to me. You can view movies online (which can easily be ported to modern television sets), search the Internet for what you want and watch it instantly. There is no pre-programming, no commercials, no waiting to see what you want to watch.

800 channels. Can you imagine that cable bill?

Can we live without SUVs?

This article was certainly sponsored by GM, "Why we need big hybrid SUVs". For me, putting a hybrid engine in an SUV just looks like another way to inflate the price of these overpriced monstrosities even more. What amazes me (well, not so much) is how perfectly justified the owners of these vehicles are that they need a 3 row SUV.

Fact is, these large gas guzzling high-tech tanks have spoiled us all. We just can't imagine sitting in a car without plenty of arm and leg room around us with a personal television screen and cup holder and a dog in the back in his own fenced off play area.

Unlike the 'green' crowd, I have no problem with SUVs. You want a big expensive gas sucking tank? Fine. But don't complain when you're paying $35,000 for a vehicle and breaking your budget at the gas station. Getting 14mpg is hurting you at the pump? Boo hoo. You wanted convenience in the form of your own personal bus, you got it.

The problem with the article is that it fails to report how much this hybrid feature in a Yukon will cost. For every dollar up front you spend to reduce your mileage, you eat into your future gas savings. I'd be willing to bet most people would sell that Yukon for another model long before it ever offered them any real savings. The real problem is that people refuse to let go of their 4-wheeled boats.

Someone who switches from a non-hybrid GMC Yukon to a Toyota (Charts) Prius will save about 611 gallons of gas a year. That switch would make a huge difference.

But how many people do you think could actually do that?

I'll tell you who, just about everyone. Let's look at the example they give:

I didn't have to go very far to find a perfect test case: my sister. She lives in Cape Cod, Mass., where it snows heavily in the winter. She has three boys who all play hockey, a dog and a husband; and she usually has a couple of her kids' friends - and their hockey equipment - tagging along wherever they go. Try fitting that life into a Prius.

Guess what, you don't have to buy a Prius (although the Prius does offer pretty good interior room), you can buy a sedan that gets 30mpg, or a station wagon that gets about the same! But no, we're here to justify our luxurious spending so we can whine about the consequences.

Amazingly, people survived in snow before SUVs became popular. Incredibly, they managed to fit a family of 5 into a 5 passenger car. The dog? He usually went on the bigger kids lap - unheard of (although the dog was probably a lot happier than being alone in the cargo area). All that hockey equipment? There's some black metal things that can go on the top of cars, they're called roof racks.

No, your sister doesn't need an SUV. She wants an SUV because its convenient. Dog goes in the back, hockey stuff goes in the back, kids all comfy with plenty of space. Very nice. But please, stop complaining and acting like your own choices aren't your own fault just because you aren't willing to make any compromises.