RIP: Conspicuous Consumption

Incredibly the mass media continues to portray the current economic downturn as a one-sided affair: bad for everyone.

Interestingly, i see a very big silver lining: the end of conspicuous consumption as we know it. When i was a kid in the 70's, I remember my folks saving money and only spending on items as we needed them. TV's weren't upgraded unless they died. The same was true with cars, and to some extent clothing.

Clearly, as we entered the 80's, all of that changed and the cause de rigeur was consumption for any reason. The downside of this new lifestyle (an age of selfishness i believe) was a huge downturn in savings.

Well, after 28 years of consumption-based lifestyles, the world has quickly changed and hopefully it will be a permanent one. In order to keep people in the consumption lifestyle of the last 28 years, the government (via the Fed, Treasury and Fannie/Freddie, etc) worked its hardest to keep people flush with cash to spend. Clearly the outcome of this was multiple economic bubbles including commodities, housing, stock market, gold, etc.

The piper needs to be paid, and it will take awhile. In the meantime, hopefully parents will spend more time with children instead of shopping, neighbors will stop and chat a little more and people in general will recognize that life is still pretty good. Don't let the media convince any different.

The Future of America is Green Subsidization

The answer to how will America grow its economy quickly is simple: The government needs to heavily subsidize commerical and residential green development. If the government subsidized 50% of the cost of all green installation (wind/solar/hydro/geothermal, etc.) through 2015 as long as the purchases were from products manufactured in America, we would:

1) generate millions of new jobs (manufacturing/sales/engineering)
2) quickly become the world leader in technology
3) cut our oil dependence dramatically

We should stop bailing out Detroit and the banks and let the poorly run companies fail. Any bailout money should become a stimulus package in the form of subsidies to purchase green goods.

Saving Social Security

Obama has tons of political capital right now AND the country needs to save money, so why not tackle Social Security with the increase in age longevity in mind. Since SS was introduced more than 60 years ago no change to the starting age has occurred, which makes absolutely no sense since the average person lives 10 years longer than they did then.

1) As of February 1, 2009, if you are 60 or over your Social Security benefits remain the same (start at age 65, etc.)

2) As of February 1, 2009, if you are 50-59, your benefits will begin at age 68.

3) As of February 1, 2009, if you are 40-49, your benefits will begin at age 71.

4) As of February 1, 2009 if you are 30-39, your benefits will begin at age 74.

5) As of February 1, 2009 if you are 20-29, your benefits will begin at age 77.

Once this is done, the same thing can be done for all pensions at Federal and State levels. Run the numbers and you'll see this will effectively and signicantly reduce national and state debt.

Sports teams contract

My first prediction for 2009 is that by the end of 2010, at least 4 professional sports franchises in the NHL, NBA, MLB and NFL will shut their doors and have to be absorbed by the league or terminated altogether. Ultimately, this will make the overall product better as expansion over the last 25 years has diluted play and ultimately, the value of the product.

I believe this will happen primarily as fans pull back on paying for ridiculous ticket prices, concessions and parking. Sadly, this could be a boon for teams like the Yankees who picked up 3 marquee players and over the next 5-6 years should have a huge financial advantage over most of MLB.