This probably goes in the people are so scared they are starting to save category. Ben Stien

NOT long ago, a woman in California called me for advice. She is divorced, with two children, and has a series of interlocking financial problems.
She lives in a lovely home in a stylish inland enclave. It has an interest-only mortgage of about $2.2 million that requires a payment of $12,000 a month, very roughly. It was last appraised at $2.7 million, but who knows if it’s now worth anything remotely close to that price.

The woman, whom I’ve known since she was a teenager, has no job or other remunerative employment. She has a former husband, an entrepreneur whose business has suffered recently. He pays her $20,000 a month, of which roughly half is alimony and half child support. The alimony is scheduled to stop this summer.

She has a wealthy beau who pays her credit card bills and other incidentals, but she is thinking of telling him she is through with him. She has no savings and has refinanced her home repeatedly, always adding to indebtedness and then putting the money into a shop she owns that has never come close to earning a dime. Now she is up all night worrying about money. “Terrified,” as she put it. She wanted me to tell her what to do.

She might have to live within her means, what a tragedy.

hat tip washingtonmonthly

Posted by John Rove as Words at 1:54 AM GMT+4

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I think we might see some good come from the current economic crisis but it will be painful:

Expect closings and bankruptcies to rattle the likes of Lane Bryant, Gap, and Starbucks. It’s the inevitable counterpunch to the days of retailers fighting hand over fist for market share during an era of loose credit and minuscule interest rates.

Those days are over, probably for a long time. While accelerating unemployment will only last so long, consumers’ debt loads and credit access don’t figure to recover to pre-party levels for quite awhile.

“I don’t think we will live the same way for 10 years,” says Howard Davidowitz, chairman of New York-based retail consultant and investment bank Davidowitz & Associates. “People are so scared they’re starting to save.”

I guess some people even see a down side to savings and while it might slow down the economy it also might give a better inication of what things are really worth. If you know you are going to have to work for a certain amount of time the burnt coffee at Starbucks suddenly doesn’t seem worth it.

We are probably going to have some very painful contractions in the economy but in the end we might find that we are better off for it. I guess I should thank Bush.

Posted by John Rove as Words at 1:48 AM GMT+4

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ETM

Posted by Al Swearengen as Comedy at 12:10 AM GMT+4

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The “cool mom” strikes again:

She slammed reports that 18-year-old Bristol Palin and the teen’s fiance are high school dropouts. The governor insists the two are not dropouts because they enrolled in correspondence courses.

The couple last month had a son — the governor’s first grandchild.

The governor said she is speaking out to set the record straight, not because of any political aspirations.

“It’s all about the family,” she said. “I’m wired in a way that I can take the criticism. I can take the shots. But any mother would want to protect their children from lies and scandalous reporting.”

Someone needs to explain to granny Palin that if you are going to hold yourself and your family up as an example of “christian values” people are going to ask you what those values lead too. In the case of the Palin clan it has led to teenage pregnancy and dropping out of high school. Levi Johnson is lucky in that his babys mommas momma is the governor so even as a high school drop-out he can still find a job thanks to her connections. Most teenage dads who drop out of high school are not so lucky.
I hope that Sarah Palin stays the frontrunner for the GOP nomination in 2012, as long as she is out there as an example of “conservative success” I think most people will understand why conservatism is a complete failure.

Posted by John Rove as Words at 11:15 AM GMT+4

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I didn’t get a chance to see any of the inaugural address today but I liked this part as reported at the washingtonmonthly.com

Consider some of the examples Obama held up as things to reject: “petty grievances,” “short-cuts,” “those who prefer leisure over work” — qualities reminiscent of adolescence. And who was held up for praise: “workers who would rather cut their hours than see a friend lose their job,” “a parent’s willingness to nurture a child,” troops who volunteer to serve as the “guardians of our liberty” — examples of maturity.

the best part for me was the idea of people willingly cutting their hours so a friend can keep their job, although I think this attitude might lead to a little more leisure, and perhaps people spending more time with their children. I hope the idea here is to spend less time chasing material goods and more time trying to make the country better and more equitable for everyone who lives in it.

I have high hopes right now I guess in a few years we will see if those hopes are justified.

Posted by John Rove as Words at 2:40 AM GMT+4

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I am starting to think that someone has to be held accountable for the last eight years specificaly for the torturing of people and the wat profiteering that has taken place. At the very least anyone who has profited from the war, like oh say Dick Cheney, should face a civil suit and asset forfieture. Anyone who has condoned torture should see the inside of a jail cell.

As much as it would be nice to move foreward and look the other way, at some point we as a country have to show that our laws matter and that world law matters as well. An investigation and trial of Dick Cheney and George Bush would show that as a country we do in fact respect the law and that no one is above it. If Cheney and Bush are allowed to go unpunished we are saying that certain people are above the law, and our laws are meaningless.

Obama needs to do the unpopular thing, and prosecute anyone who committed a crime in the Bush administration; if he doesn’t he risks letting his presidency seem to condone the torture and other crimes committed over the last eight years.

Posted by John Rove as Words at 1:09 AM GMT+4

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This is why you’re a fool to even watch this channel. It is a bullhorn for lies that corporate America would love to have spread around. I’m so glad that I don’t recognize any of these people.

Posted by Al Swearengen as Economics at 11:55 PM GMT+4

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Looks like Bank of America needs more money to save Merril Lynch. My guess is we will see many banks coming back for more money so that they can continue making bad investments and loaning money to people who have no prospect of repaying the loan. I don’t know the exact figure but I would guess that a large percentage of the typical consumers income is going to debt servicing, that is the money paid in interest late fees and overlimit fees, all the things that made credit card companies profitable for many years. I dont get why no one is talking about the failure of our credit based economy. The solution is not to give people more credit, that just creates a bigger hole down the road.

A better sollution is to figure out a way to get people out of debt, perhaps make it easier and less stigmatizing to go bancrupt on credit cards, or start forgiving student loans; maybe even allow people to refininance their home at its current value and forgive the extra debt. If people didn’t have to spend so much of their income on debt service they might actually spend more money on consumer goods, which people keepsaying will jump start the economy. The problem right now is that the economic plan seems to entail people getting easy credit so that they can buy more stuff and in a year or so we will be right back in the same place, just with a larger deficit. If consumer debt was forgiven people might be able to get back to buying stuff but they would not be using borrowed money to do it, which might lead to a sustainable recovery.

The bailout should focus on the consumer and how to get the average borrower to a functional level. Obviously the people who borrowed more money than they could hope to repay are not without blame in this mess, but a bailout that encourages banks to keep giving them more money is crazy.

UPDATE: Looks like somebody said this much better than I did

Posted by John Rove as Words at 2:04 PM GMT+4

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Matthew Yglesias comments on the “non-conservative” lunch with Obama:

…everyone who’s not a card-carrying member of the conservative movement is counted, essentially, as a liberal. Or, rather, that the essential dichotomy is held to be between conservatives and not-conservatives rather than between conservatives and liberals. But this group isn’t at all the mirror image of the conservative roster we heard about last night. Some people on it are, but others really aren’t. It’s like the common description of Brookings (rather than, say, CAP/AF) as a “liberal” think tank simply because it’s not a conservative one

This might be a byproduct of the fact that almost anyone who acknowledges reality is kicked out of the conservative movement, and is labeled as a “liberal” by the grand poubahs of conservatism. This, I think can be a good thing for liberals and liberal ideas as conservatives seem willing to define most of their thoughtful members as liberals leaving nothing but the hardcore idiots as true conservatives.

Posted by John Rove as Words at 6:31 PM GMT+4

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This should be good news for anyone who wants t see a progressive agenda enacted in the next four years:

Barack Obama is apparently planning to create a permanent political organization designed not just to help him win reelection in 2012, but to help him get his policy agenda passed in the meantime

For me, one of the main for supporting Obama was his wiliingness to think outside the box and he seems to be making a an orginization that can compete with the religous right for grassroots organizing, who ever thought this up is very smart.

Posted by John Rove as Words at 1:27 PM GMT+4

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Sarah Palin continues to talk:

“Bored, anonymous, pathetic bloggers who lie annoy me….I’ll tell you, yesterday the Anchorage Daily News, they called again to ask — double-, triple-, quadruple-check — who is Trig’s real mom,” she said, in an interview to be published in the magazine’s March issue.

“And I said, Come on, are you kidding me? We’re gonna answer this? Do you not believe me or my doctor? And they said, No, it’s been quite cryptic the way that my son’s birth has been discussed. And I thought, Okay, more indication of continued problems in the world of journalism

The Trig story was mostly followed by Andrew Sullivanwho can definitely be annoying but he is not anonymous. I think conservatives are definitely going to be entertaining for the next few years.

Posted by John Rove as Words at 1:46 PM GMT+4

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This is hysterical looks like Huckabee was for sodomy before he was against it.

Posted by John Rove as Words at 1:08 PM GMT+4

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I would love to see the away teams do well today and tomorrow, especially Philly and Arizona but my guess is that in the NFC the home teams win. If Arizona can generate a runing game they have a chance and Philly is playing pretty well but I think most people see Carolina and New York winning these games.

In the AFC I think San Diego has a very good chance against Pittsburg as for whatever reason San Diego seems to play really well in the post season and Rivers may be the best quarterback playing right now. Tenessee wins easily today.

Let me know what you think

Posted by John Rove as Words at 5:58 PM GMT+4

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The unemployment numbers don’t tell the whole story:

Brad DeLong offers some further context for the jobs numbers, observing that “And U-6–unemployed plus discouraged workers plus unable to fond a full-time job–is now at 13.5% of the labor force–and BLS ‘discouraged workers’ are a big undercount of the concept.” With so many able-bodied, working age people not actually working, we’re producing many fewer goods and services than we have the capacity to produce.

I know the free market types are goiing to say that “if we just let the market do it’s job we would be fine” although to me it looks like the market has spoken and without easy credit people don’t want a bunch of marginally useful consumer goods. Even things like cars are probably not going to be replaced every few years.

Maybe their is something else at work here, like we are starting to reach a level of population that we cannot support, or support in the style that most people have become accustomed too.

Posted by John Rove as Words at 12:37 PM GMT+4

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Obama has made quite a few right moves and a couple bad ones. First, what was he thinking making Hillary Clinton Secretary of State, she has not shown herself to be competent in any office she has held, and her silence on the mess in Gaza makes me think that she OK with the situation.

Second mistake, Sanjay Gupta for Surgeon General, he is what is wrong with the medical profession and the media all rolled up in one self-aggrandizing package.

Posted by John Rove as Words at 11:13 AM GMT+4

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Mr. T is a knucklehead – the pop-ups are great

Posted by Al Swearengen as Comedy, History, Video at 12:21 AM GMT+4

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Looks like the market may not lead people to the best health care choices, but at least they die on nice sheets.

Posted by John Rove as Words at 6:57 PM GMT+4

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Good luck

Government Mule

Posted by Al Swearengen as Music, Video at 4:15 AM GMT+4

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Looks like Apple has another cool sounding gadget coming out this fall. I will proably buy it cause for some reason I cannot say no to Apple stuff and I will probably be dissapointed once again. When the Ipod Touch came out I had to have it, I quickly discovered it was too delicate to take snowboarding and was too bulky to run with, so I bought a shuffle which also seems too delicate for snowbaording. It really sucks to have your Ipod conk out on you at the same time you are sitting next to a Texan on the chairlift and that has happened to me twice this year.

With all that said I am already starting to covet the new large screen touch I am sure this time I wont be dissapointed, just like the girlfriend that keeps cheating on you. Apple lures you back with an attractive but very high maintenance product.

Posted by John Rove as Words at 1:14 PM GMT+4

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