patrick.net

"Historically, consumption led expansions do not have staying power"*

Steve Lehman, Federated Funds*

Gosh, do you think we could consider at least the last 5 years a "consumption led expansion"? Thanks for sharing that Steve.

"Spending your way out" of a recession has been tried before with dismal results.

In retrospect FB's should be grateful! They were shown their way into neighborhoods they otherwise may not even have driven through. Permitted to vacation at spots they'd seen on Robin Leach's Lifestyles of the Rich and Famous and drove some really neat cars/SUV's (for awhile).

“Spending your way out” of a recession has been tried before with dismal results.

So the only tried-and-true way is a world war?

Wars and World Wars have a pretty dismal record of stemming recession and overpopulation. WWII was a truly exceptional outcome that required exceptional leadership by Allied leaders. I can't think of any current politicians, of any nationality, who is capable of pulling off a similar accomplishment.

Robert Coté Says:

I notice this in even my modest neighborhood. People seem reluctant to form relationships with those suspected of swimming naked.

Oops. I guess I'll have to start wearing clothes.

SFWoman Says:

Why would someone put that in instead of wood or bamboo?

It's cheaper and easier to clean. It's the American way. Actually, the American way is to get wall-to-wall carpeting and just replace the whole thing every few years.

I just thought Steve Lehman's comment was funny b/c we've evidently beat on the "consumer driven" expansion like a "rented mule". I mean, when life has put you in the position of having to rent a mule do you really care what condition you return it in? How would it be possible for us as nation to get one last iota out of this "growth vehicle"?

Someone made the comment that granite countertops will become the lime green formica of the future! (At least w/formica you could cover over it quite inexpensively). Perhaps in the near future we will be able to reuse the repo'd granite counter tops for FB tombstones? Hell! There's enough to make a whole tomb!

"Does anybody actually use that Pergo stuff?"

Oh come on! (You can sh@t in front of us!)

My luxury rented condo has it and it is worthless! Even the slightest scuff becomes permanent and it "spots" terribly. As long as you never have company or wear shoes it should do just fine.

Unlike real wood floors (or classic guitars) the wear and tear look more like parking lot door dingers than a contribution to character. Worthless I tell you.

Pergo is not too bad per se. It's an easy and cheap alternative to wood flooring. It's much better than most carpeting and more aesthetically pleasing than linoleum. The problem is that it's so easy to install that lots of people DIY it and then goof it up.

“Spending your way out” of a recession has been tried before with dismal results.

Consumption led recoveries have been quite common 1950-present. G = C + S + I - T. All the terms are related. There cannot be a recovery without C.

Randy H,

Well, agreed but you can't have a meaningful recovery with just C?

Well, agreed but you can’t have a meaningful recovery with just C?

A smaller T would help.

Since its so slow today, here's an interesting link to read:

The High Cost of Free Parking
http://www.thisplaceis.com/archives/26#respond

Peter P,

True! LOL!

The High Cost of Free Parking

Robert, this is your area.

Pergo is the stuff they sell at Costco right?

http://www.costco.com/Browse/Product.aspx?Prodid=11122539&whse=&topnav=&browse=&s=1

Being a person used to carpets (I love noise dampening) - how does one do hardwood floors normally?

C is fine, unless it cannibalizes S and I and decrease future C. The current American economy is consuming at the expense of saving and investing.

"Being a person used to carpets (I love noise dampening) - how does one do hardwood floors normally?"

Train your kids in qing gong so that they may move swiftly and silently. Also, so they can fly through air and/or walk on wire.

http://en.wikipedia.org/wiki/Qinggong

eburbed Says:

Being a person used to carpets (I love noise dampening) - how does one do hardwood floors normally?

Your link looks like real hardwood (bamboo), just pre-treated by heat to give the color shown, rather than staining hardwood the old fashioned way. I'm not certain, but this implies it's color finish is as-is. Traditional hardwood needs to be stained, then finished with wax. On the other hand, when it looks worn, it can always be refinished. Pergo uses wood laminate, so there is less actual wood, but it therefore doesn't last as long. Sorta like the laminate fake wood look on most Ikea furniture.

Maybe mr. newsfreak can chime in?

This is a really stupid question, but... uh... let's say I enter a house that has carpetting.

What's under the carpet/carpet pad?

Would it be a hard wood floor that then needs to be stained and finished?

Why don't people like carpetting anymore?

This is OT but has been discussed much of late. Local CPA just got back from Vegas where they had the IRS Seminar and it IS as we suspected!

Outsourced collection agents will not be going after Tyco and GE! (duh)

They however will not be calling on you b/c you miscalculated your add'l child care tax credit either! So let's all take a chill pill here, o.k?

So what are these thugs going after? SCHEDULE C!

The obvious stuff. Guy claims 36K in income (after expenses) and his mortgage is 35K!? Oh, and 5 dependents? Toast.

Primarily it's folks that have already been hauled out on the carpet and are simply no longer responding to correspondence in any form. This could actually be fun.

Why don’t people like carpetting anymore?

Too difficult to clean and maintain. Hardwood can be used with a sound-absorbing layer to reduce noise.

I do like berber carpet for bedrooms. Carpet does feel warmer.

eburbed Says:

Why don’t people like carpetting anymore?

Not necessarily stupid...What lies beneath depends. You can usually lift up the corner of the carpet to see what's underneath. Some homes (often older ones) will have old hardwood underneath, while some will reveal that the owners cheaped out and just laid carpet over concrete or wood (stairs, for example). The hardwood underneath would then need to be stained and finished.

Carpeting wears out, is hard to clean, and with everyone's allergy concerns these days, it's just a vat for germs and allergens. May be some issue of fads of the times, too. I personally much prefer hardwood.

astrid,

That's my point. We're cannabalizing everything we can get our hands on. When a stockbroker blows up your account and you have no more money, you're broke, but that's it.

After realt-whores and mortgage brokers are done with the American consumer he's tapped out for life. And all these "industry professionals" are wondering where all the buyers went? Same with Lowe's and HD. Gosh, and things were going so well.

Robert Coté Says:

Don’t get me started.

Too late! Hit a raw nerve, did we?

Free parking is evil and must be stopped.

I am not against being charged for parking. However, I would prefer not having to wait in line to pay. How about an integrated electronic tracking system that monitors speeding, road usage, and parking?

Just like they have in London.

Robert,

I just love your anti-NURB/TODler rants, but it's a whole lot more readable when you use paragraph breaks (see reformatted rant above for example). Otherwise, keep up the good work and give those FOAMers hell!

DinOR,

I certainly do agree with you about the state of consumption today. I wrote that comment as a response to Randy H's equation.

I'm not opposed to paying for parking directly, but only if the fee collect was instanteous and continuous (eg cash card swipe at the parking meter that automatically deducts based on time spent). Most of my pay parking experiences were highly negative, you're always waiting to get in or out, or worried that your meter just ran out.

Eburbed:

On the carpeting vs. hardwood topic; we pulled carpets at my old house to reveal hardwood beneath. Newer places may have just a layer of padding over concrete.

Personally, I prefer hardwood with rugs as needed. It's easiest to clean, and you can always refinish it in the worst case. (Of course, this modern stuff that passes for hardwood is fairly wimpy. Bamboo flooring looks nice, but you wouldn't want anyone to wear heels on it.) Also, for those who entertain, hardwood makes a much better dance floor.

Based on my fairly narrow observation, you'd be very lucky to get concrete or hardwood base floor. Every McMansion in construction I've been to, up to multi-million dollar places, had OSB board floors nailed to some softwood beams.

If you change flooring in one of these places, take the time to drill in a couple pounds of screws to the boards. That would really help quiet floor squeaks. I know people whose floors started squeaking after only one or two years of habitation.

I think all homes should be built with steel-reinforced concrete.

Well, I like to over-engineer. You can ignore me now.

"Well, I like to over-engineer. You can ignore me now."

Maybe not. You may want to read Slate's current series on surviving catastrophes.

"Perhaps the most vulnerable place in the nation right now is New York City, which turns out to be the third-most seismically active region east of the Mississippi. Geologists estimate a 20 percent to 40 percent chance of a significant earthquake in the next 50 years in New York, and they make a special point to say that a major quake is also a real possibility."

http://www.slate.com/id/2148772/entry/0/

Maybe not. You may want to read Slate’s current series on surviving catastrophes.

I would rather have an off-grid capable solar power system and an auxillary natural-gas generator instead of a boat or an RV.

Huh? Sorry if I wasn't clear. I meant more "over-engineering" might be a good idea for much of the country. Earthquakes are rarer in the East, but could be even more devastating because they affect larger areas.

C is fine, unless it cannibalizes S and I and decrease future C. The current American economy is consuming at the expense of saving and investing.

Of course this is true. But keep in mind that only businesses, not people can I, and only people, not businesses can S. Both T.

The feedback is that:

People save S by putting it into banks
Banks use that to provide capital for businesses to invest I
But businesses produce goods and services that are consumed C
and the dreaded T is a drag on the entire system

in reality some T re-enters as Gs, the real equation is NI = C + S + I + (G - T)*w where w is the gov't waste rate.

But if there's too much S, you get deflation ala Japan. If there's negative S, then there is either inflation or not enough business I.

"But keep in mind that only businesses, not people can I, and only people, not businesses can S."

That's true in a strict sense.

Also, in cases of small businesses, partnerships, sole proprieterships, D corporations and even lots of C corporations, the owners (real people) are deciding between business investment, consumption for themselves, or saving via an outside vehicle. There's a lot of fluidity there.

Even for openly traded C corporations, they can decide between re-investing their earnings, retaining their earnings in cash and distributing the earnings to shareholders. If the businesses retain the earnings in cash, that allows them to defer the income for future I or future C or S for their shareholders. Similarly, shareholder or bondholders response will affect business I decisions.

But to me, this relationship is secondary to the worrisome nature of the American addiction on credit. Many people are borrowing so much to C now that it's almost certain to affect their ability to C and S later. Many businesses have depended on cheap credit to sell their stuff and will also be in trouble.

what's pergo? is it that 4 mm wood veneer on craft wood floating floorboard stuff, or plastic laminate designed to look like wood? beloved of concrete slab construction dwellers...

Rug burns.

especially nylon :(

So you're in fact concerned with conspicuous C. In fact, most C is not conspicuous, but sustinance at the established standard of living. I'm ignoring cultural equivalency arguments--it's not really relevant that other peoples are living with more or less relative standards in other nations, in this context.

What we likely agree upon is that the small portion of marginal conspicuous C is a disproportionate component of future growth. That is the bigger problem, in my opinion. Not that there is conspicuous C; such goes along with living in a free market capitalism.