patrick.net

Now I wonder if my teenager’s generation is about to experience what my grandparents did at that age, and if they will spend thier lives much the same.

Of course not, they were born under different stars. The collective personality of a generation decides the reaction of people in economic events.

Funny how people can come up with inventive ways to save relatively small amounts on groceries and gas, but never considered big ways to save money

Oh, tell me about it ! I am surrounded by people who will not order from Pizza Hut without a coupon, but have purchased sh1tboxes in the Fortress for an obscene amount. "Penny-wise, pound-foolish" should be engraved on the Cupertino town hall.

“Penny-wise, pound-foolish” should be engraved on the Cupertino town hall.

Perhaps they are saving the pennies for the copper.

Of course not... The collective personality of a generation decides the reaction of people in economic events.

Well in that case, lets hope they grow out of their "cheat code" mentality and choose learning from the past over being entertained and accommodated in every way. Entitlement may have a drastically different meaning in 20 years.

But then, who am I kidding right?

Perhaps they are saving the pennies for the copper.

I just had a coworker suggest this strategy to me, recently. Are pennies really worth more for the physical metal in them, than their face value?

I watched Kudlow the socialist yesterday and he had a Senator on the air that supports a broad bailout of the FBers.

This is no different than how my brothers and I played monopoly. When one of us got into a bind we would “rob” the bank and split the money 3 ways. The insolvent guy could pay his bills and the other 2 got rich. It could only happen once during the game because we could not print more money.

I made a bet and lost. I bet that the rules to the game would not change. I am going to lose that bet and end up with money that will buy less than it did before.

I heard that US is planning to mint pennies out of some other metals soon. Which tells me that yes, pennies cost more to make than they are worth.

No one cares about pennies already and with the purchasing power of the dollar declining, people will care less in the future.

I say get rid of all coins less than a dollar.

Except for the quarter, of course. Renters need it for laundry :)

Are pennies really worth more for the physical metal in them, than their face value?

Possibly. I am not sure about the legal issues though.

Well in that case, lets hope they grow out of their “cheat code” mentality and choose learning from the past over being entertained and accommodated in every way. Entitlement may have a drastically different meaning in 20 years.

The collective personality is pretty much set in stone.

I say get rid of all coins less than a dollar.

Silver dollar?

Well, at least we know that pennies are copper-backed. :)

Pennies haven't been made of copper (actually bronze) for many years. They presently are a zinc slug which is copper plated. Your government at work. :)

People can buy items at a whole seller and then divide amongst themselves. For example Costco sells many things in multi-packs. Like the tea bags. They are 3 packs bundled together, each having 100+ tea bags. Frugal shoppers can buy this multi-pack and take one for each.
I've been working up a co-op among my neighbors here since I'm single and can't use up some of those "bulk" items. First up was 50 lb bag of really good onions for $4 - I divided these in 4 equal parts and sold off three for $1 each. Also got prime 100% sesame oil for $14 a gallon, which got divided into clean wine bottles.

Pennies haven’t been made of copper (actually bronze) for many years. They presently are a zinc slug which is copper plated. Your government at work.

I was tricked!

Also got prime 100% sesame oil for $14 a gallon, which got divided into clean wine bottles.

$14 a gallon? Is it brown gold or what? :)

www.usmint.gov/about_the_mint/fun_facts/index.cfm?flash=yes&action=fun_facts2

"The alloy remained 95 percent copper and 5 percent zinc until 1982, when the composition was changed to 97.5 percent zinc and 2.5 percent copper (copper-plated zinc). "

Have you ever bought real sesame oil for cooking? It's more like $5 for a tiny bottle in the grocery stores.

It’s more like $5 for a tiny bottle in the grocery stores.

I know... just forgot how "affordable" gasoline is. ;)

Except for the quarter, of course. Renters need it for laundry :)

Some owners too.

Speaking of interest rates - I heard a fun argument yesterday: Bank vs Mortgage Broker.

Person 1: Banks are the best sources to get mortgages. Mortgage Brokers are shady and tack on lots of fees

Person 2: But Mortgage Brokers will actually try to get you a better rate. That's what you're paying them to do. Banks don't give a sh*t.

Person 1: Neither do mortgage brokers. YSP!

Person 2: Does it matter? If you get a crappy interest rate from a bank, you're still paying as much.

Eventually it went into a stalemate. Talk about a no win argument.

Rental scum! Go buy a boomer's house so they can retire comfortably outside the Fortress someplace. ;)

Headset said:
Funny how people can come up with inventive ways to save relatively small amounts on groceries and gas, but never considered big ways to save money

Case in point - the executive admin at my previous job traded in her RAV4 and got a Lincoln Navigaturd. When I asked why, one of her reasons was that she was splitting a Costco membership with her two sisters, so she needed the extra space for groceries. So they _each_ got a bigger SUV. Yeah, all three of them.

sriramgopalan Says:
I heard that US is planning to mint pennies out of some other metals soon.

Plastic pennies? Made in China, of course - so at least they will have some lead... :-)

Its funny when we throw around terms like 7-8 years ago.

As near as I can tell, the last rational year in RE was 1998, 10 years ago. 10. By 1999, WOW, what a difference.

Then, the wheels totally came off the bus in 2003 when Mozilla led the industry the rest of the way into the dumper by killing underwriting.

For those who wish to use my same models, I do this:

Use 1997 as a basis year. Rather than the national long-terms trend of house appreciation tracking to real inflation, I use the Bay Area historic average of 4.5% appreciation per year (over the last 40 years). This allows a projection from 1997 so that prices today can be regressed to the mean over any time span.

If you had asked that Case Schiller would show a San Francisco YOY drop of 10.8% I would not have belived it. But then, San Diego had a 15% drop. This should help bound the speed of the decline with the caveat that things can accelerate or decelerate the regression. Right now the massive monetary deflation (credit crunch) has is acting as an accelaterator. as near as I can tell, the easy money fed is being offset by everyone's inflationary expectatons so that higer mortgage rates are, in fact, modestly accelrating price declines.

Soooo, shave 5% from the summer of 06 to 07, 10% to '08, 10% to '09 and 10% to 2010 and many BA cities will be fully regressed to the mean. This roughly corresponds to 2003 prices in 2010 WITHOUT adjusting the dollars for inflation.

The problem with the "penny wise, pound foolish" crowd is that they really don't commit themselves to a frugal lifestyle.

I've read Jeff Yeager's new book The Ultimate Cheapstake's Road Map to True Riches, and it was a disappointment to me. www.ultimatecheapskate.com I already did all that stuff. Fortunately I didn't spend money on his book: my sister gave me a copy. :)

Jeff really tackles the PWPF problem. His advice: buy a house early and commit to being happy living there. Pay it off ASAP. He's in Maryland so the facts are different for the Bay Aryans.

Plastic pennies? Made in China, of course - so at least they will have some lead…

PetroPennies? :)

The problem with the “penny wise, pound foolish” crowd is that they really don’t commit themselves to a frugal lifestyle.

Think Abundance!

One should live an abundant life.

The mint is considering making pennies out of steel or something.

Here is Ron Paul's short speech before the financial services committee about that:

http://www.lewrockwell.com/paul/paul440.html

Peter P said:
(return to frugality) It will hurt corporations and that may in turn harm Americans.

Mostly the middle-class, I think. The Greenspanke (tm) Double-trouble-bubble (tm) mostly sucked in disposable income from the middle-class, who hocked everything they had to get in on it. The collapse will make their investments worthless and will hit their employment and wages very hard.

The real poor started with very little, and will stay that way. The rich started with a lot and end up with a whole lot more. The delta will come from the collective impoverishment of the middle class. So Pain, as defined by actual lifestyle change will be most pronounced in this class.

Anyway, I think the majority of today's problems were rooted in evil policies created in the 1930's.

Duke Says:
the wheels totally came off the bus in 2003 when Mozilla led the industry the rest of the way into the dumper by killing underwriting.

"Mozilo" - the excessively orange debt-peddler

"Mozilla" - the excessively excellent open-source web-browser platform

Some of us are quite fond of Mozilla and contribute to its code, so don't knock its good name. :-)

Mostly the middle-class

The middle-class is an unnatural occurrence in history anyway. But don't worry... I am sure all slaves in the future have iPods. :)

Some of us are quite fond of Mozilla and contribute to its code, so don’t knock its good name.

Some perspective...

I consider myself a die-hard Microsoft supporter. I have been using Internet Explorer since version 1.0.

I am typing this message from a Firefox window.

I don't buy the argument that corporations somehow need consumers to spend like to be able to survive.

If consumers become frugal, companies that make actually useful products and provide actually useful services will continue to thrive.

Others don't deserve to surive! Creative destruction, baby!

Can anyone please explain the moderation rules here? I did not use any foul language in a previous post, yet it goes to moderation.

DennisN :

From where I come in India there is a non-profit organization (Graahak Sangh - meaning Group Buyers) that does similar to what you have done. They buy bulk, high quality stuff, and distribute it in smaller portions. The cost savings were substantial.

Duke says: This roughly corresponds to 2003 prices in 2010 WITHOUT adjusting the dollars for inflation.
Futures trading for the SF Case/Shiller Home Price Index from CME :
Nov. 08: 158.40
Nov. 012: 153.40

Historic Index Nov. 03: 153.36

The market seems to agree with you (although it appears to be showing a VERY rough ride the next 6 months). I imagine core Fortress regions will more likely follow the gradual trajectory you laid out over the next couple of years while less desireable ones will hit the bottom quicker. I still have not seen a huge inventory boost in the $1 million-$250k range that I would expect in my region. Will be interesting to see what happens during the summer. At any rate, even if inventory isn't ballooning, there are enough REOs to make life interesting.

More than one link in a post will trigger moderation.

And Mozilla begat Netscape, and Netscape begat Firefox. Sounds very Old Testament to me.

If consumers become frugal, companies that make actually useful products and provide actually useful services will continue to thrive.

But that economy cannot support enough "subprime" companies, which are required to support the employment base.

It all boils down to the fact that human civilization is a farce.

thenuttyneutron :

I am not sure about all the rules but words like soc1ali1sm can also get you in moderation. Hence I spell like sh1t (pun intended).

Summer? What am I thinking? The Silent Spring is coming...

I am not sure about all the rules but words like soc1ali1sm can also get you in moderation.

I am not fan of socialism but Patrick does not moderate base on ideology.

The problem with "socialism" is that it contains the name of a male potency drug.