consumer isn't dead yet

[zoog]

Re: consumer isn't dead yet

Can't remember if anyone has posted this cartoon before but seems appropriate.



http://www.salon.com/comics/boll/2008/10/09/boll/

[grizam303]

Re: consumer isn't dead yet

Starting to read that comic, I was going to say something about how agricultural production may end up being our saving grace, but then I hit the fifth panel.

One thing I learned in college is that you don't necessarily have to do well, you just have to do better than others. I can't say that this comic would be far off from America's contemporary family. I think most people reading this are better-positioned than those who aren't. Just don't get complacent.

[Nervous Drake]

Re: consumer isn't dead yet

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[Rajiv]

Re: consumer isn't dead yet

I don't think it is ever healthy to believe that I am a better man than someone else because of how well I do in society.
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I will relish in achieving as best I can. The road to rebuilding that which has been lost (culture, values, plentiful productive jobs, a sense of purpose and individualism) will be a long, hard journey. Being "better positioned" for this is all relative.

You should read Herman Hesse -- Siddhartha

Siddhartha went to Kamaswami the merchant, he was directed into a rich house, servants led him between precious carpets into a chamber, where he awaited the master of the house.

Kamaswami entered, a swiftly, smoothly moving man with very gray hair, with very intelligent, cautious eyes, with a greedy mouth. Politely, the host and the guest greeted one another.

"I have been told," the merchant began, "that you were a Brahman, a learned man, but that you seek to be in the service of a merchant. Might you have become destitute, Brahman, so that you seek to serve?"

"No," said Siddhartha, "I have not become destitute and have never been destitute. You should know that I'm coming from the Samanas, with whom I have lived for a long time."

"If you're coming from the Samanas, how could you be anything but destitute? Aren't the Samanas entirely without possessions?"

"I am without possessions," said Siddhartha, "if this is what you mean. Surely, I am without possessions. But I am so voluntarily, and therefore I am not destitute."

"But what are you planning to live of, being without possessions?"

"I haven't thought of this yet, sir. For more than three years, I have been without possessions, and have never thought about of what I should live."

"So you've lived of the possessions of others."

"Presumable this is how it is. After all, a merchant also lives of what other people own."

"Well said. But he wouldn't take anything from another person for nothing; he would give his merchandise in return."

"So it seems to be indeed. Everyone takes, everyone gives, such is life."

"But if you don't mind me asking: being without possessions, what would you like to give?"

"Everyone gives what he has. The warrior gives strength, the merchant gives merchandise, the teacher teachings, the farmer rice, the fisher fish."

"Yes indeed. And what is it now what you've got to give? What is it that you've learned, what you're able to do?"

"I can think. I can wait. I can fast."

"That's everything?"

"I believe, that's everything!"

"And what's the use of that? For example, the fasting-- what is it good for?"

"It is very good, sir. When a person has nothing to eat, fasting is the smartest thing he could do. When, for example, Siddhartha hadn't learned to fast, he would have to accept any kind of service before this
day is up, whether it may be with you or wherever, because hunger would force him to do so. But like this, Siddhartha can wait calmly, he knows no impatience, he knows no emergency, for a long time he can allow hunger to besiege him and can laugh about it. This, sir, is what fasting is good for."

"You're right, Samana. Wait for a moment."

Kamaswami left the room and returned with a scroll, which he handed to his guest while asking: "Can you read this?"

Siddhartha looked at the scroll, on which a sales-contract had been written down, and began to read out its contents.

"Excellent," said Kamaswami. "And would you write something for me on this piece of paper?"

He handed him a piece of paper and a pen, and Siddhartha wrote and returned the paper.

Kamaswami read: "Writing is good, thinking is better. Being smart is good, being patient is better."

"It is excellent how you're able to write," the merchant praised him. "Many a thing we will still have to discuss with one another. For today, I'm asking you to be my guest and to live in this house."

Siddhartha thanked and accepted, and lived in the dealers house from now on. Clothes were brought to him, and shoes, and every day, a servant prepared a bath for him. Twice a day, a plentiful meal was served, but Siddhartha only ate once a day, and ate neither meat nor did he drink wine. Kamaswami told him about his trade, showed him the merchandise and storage-rooms, showed him calculations. Siddhartha got to know many new things, he heard a lot and spoke little. And thinking of Kamala's words, he was never subservient to the merchant, forced him to treat him as an equal, yes even more than an equal. Kamaswami conducted his business with care and often with passion, but Siddhartha looked upon all of this as if it was a game, the rules of which he tried hard to learn precisely, but the contents of which did not touch his heart.

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The merchant passed to duties of writing important letters and contracts on to him and got into the habit of discussing all important affairs with him. He soon saw that Siddhartha knew little about rice and wool, shipping and trade, but that he acted in a fortunate manner, and that Siddhartha surpassed him, the merchant, in calmness and equanimity, and in the art of listening and deeply understanding previously unknown people. "This Brahman," he said to a friend, "is no proper merchant and will never be one, there is never any passion in his soul when he conducts our business. But he has that mysterious quality of those people to whom success comes all by itself, whether this may be a good star of his birth, magic, or something he has learned among Samanas. He always seems to be merely playing with out business-affairs, they never fully become a part of him, they never rule over him, he is never afraid of failure, he is never upset by a loss."

The friend advised the merchant: "Give him from the business he conducts for you a third of the profits, but let him also be liable for the same amount of the losses, when there is a loss. Then, he'll become more zealous."

Kamaswami followed the advice. But Siddhartha cared little about this. When he made a profit, he accepted it with equanimity; when he made losses, he laughed and said: "Well, look at this, so this one turned out badly!"

[Sapiens]

Re: consumer isn't dead yet

Enjoy:

http://philosophy.lander.edu/oriental/siddhartha.pdf

[grizam303]

Re: consumer isn't dead yet

I don't think it is ever healthy to believe that I am a better man than someone else because of how well I do in society.

Our housing market is nationalized, our banks are becoming enormous behemoths, and our industry is dwindled at best.

What is there to be proud of when you are a better man than someone else in such a society?

When we begin to rebuild our country, I will relish in achieving as best I can. The road to rebuilding that which has been lost (culture, values, plentiful productive jobs, a sense of purpose and individualism) will be a long, hard journey. Being "better positioned" for this is all relative.

I think you're reading into what I said a bit much. I'm referring to being better in the scope of financial positioning relative to alcoholic parents who pick up their children from extra-curricular sporting events (colloquially referred to as Joe Six-Packs and Hockey Moms). As far as being a "better man" goes, I think that's more of a philosophy question than an economics one.

The point was that most people do not see this coming, and the average iT reader (in my mind) has a much better grasp of what the future holds, and is likely better-positioned without giving it a second thought.

To expound on what I meant with college; there were classes that I took where in the first week I would be intimidated by the course material, textbooks, homework, tests, and what not. I remember in one of my classes getting a high-70's mark on the first test and thinking I did really badly. Admittedly, I didn't read the book too much, though I did my part in class and did the homework assignments. Well, it turns out most of the class didn't read any of the book, were messing around in class, and weren't really doing the homework either. This really started in my junior year, and I had at least one class like this every semester until I graduated.

In so many words, I'm essentially saying you don't have to outswim the shark, just the other guy. Then again, if the shark is really hungry, it won't really matter anyways.

[goadam1]

Re: consumer isn't dead yet

What if things turn out just "not good." What if the world keeps turning. Are itulipers going to be upset because they weren't right and the pm play didn't pan out? I hope unemployement peaks at 7% and we pay for all the credit sins with moderate inflation.

What if you don't get the greatest inflation or deflation?

[CanuckinTX]

Re: consumer isn't dead yet

What if things turn out just "not good." What if the world keeps turning. Are itulipers going to be upset because they weren't right and the pm play didn't pan out? I hope unemployement peaks at 7% and we pay for all the credit sins with moderate inflation.

What if you don't get the greatest inflation or deflation?

It's easy to play the 'what-if?' game but unless you have something to back it up with what chance is there that things just get moderately painful before it's all back to 'normal'?

The way I see it, this whole site is dedicated to empirical predictions that have been pretty much spot on and will continue to be because it's researched in great depth. Yes, the PM play may not pan out as the greatest investment of all time but it hasn't been officially promoted as that on iTulip - at least not by EJ. Just being out of the market when the crash came (and continues to occur) is reason enough to be a happy camper.

[ASH]

Re: consumer isn't dead yet

What if things turn out just "not good." What if the world keeps turning. Are itulipers going to be upset because they weren't right and the pm play didn't pan out? I hope unemployement peaks at 7% and we pay for all the credit sins with moderate inflation.

What if you don't get the greatest inflation or deflation?

Speaking for myself, that would be wonderful. Whatever reading iTulip may have prepared me for, I would at best end up "less poor" in the event of a greatest inflation or deflation -- not "more wealthy". Even if the specific investment positions I have adopted pan out initially in an economic distaster scenario, there's no way I can live off of saved wealth for any significant length of time... and the new conditions would mean that it would be much harder to acquire and retain new wealth. If things turn out "not good", then they are by definition "less bad". That means economic conditions in which I am able to save more (and protect the purchasing power of what I save), enjoy a higher standard of living, and enjoy greater physical and economic security.

[goadam1]

Re: consumer isn't dead yet

I just wonder if this is mostly a monetary crisis. I understand that replacing the fire economy will come with great pain. But the ultimate threats to wealth and wealth creation remains the amount of resources and intelligence applied to those resources. I lose the most sleep over the collapse of fish populations and competition for energy sources. If one paper system fails then another will replace it. I don't want to live in a global Nigeria.

I was watching the news on Sunday and the reporter was wondering if "binge shoppers" were going to show up.

It would be funny if Mcdonald's included the behavior of bulimics in the annual report.

I'm sure stephen leeb isn't popular around here but this is from his newsletter

SHOPAHOLISM: THE CURE FOR TOUGH TIMES.

Black Friday's sales this year are estimated to have been up by 7%. That's much higher than anyone expected. It suggests that Americans, who have received the equivalent to a $250 billion tax cut in the form of lower gasoline prices, are buying into Obama's promise that he will do what it takes to get the economy back on track. They have resumed the great American pastime of shopping.
Will the shopping continue? Not according to many economists, who argue that the natural response to tough times is to give up shopping for saving. We can't say for certain, but we have serious doubts about such predictions.
The term "shopaholic" may be a joke, but research has shown shopping to be as seriously addictive as any other compulsive behavior, such as smoking, drinking, or gambling. It activates dopamine, one of the receptors in the brain associated with addictions. This makes shopping a difficult habit to break.
When it comes to human psychology, I am more of a data analyst than an artist, but I have had my own brushes with addiction that have given me insight into how hard they are to break. Twenty-five years ago I stopped smoking in order to set a good example for my children. I got help to do it and for a time participated in a group of four people who were also trying to quit the nicotine habit.
One of the other people in the group was there because he had had open heart surgery five years previously, and that had not been enough of a wake-up call to get him to quit on his own. Another was a very successful older man who had already lost a lung due to smoking. Yet at that time, his record for going without a cigarette was only one week!
Needless to say, this group made me deeply aware just how difficult it is to break an addiction. If you are choosing Camel cigarettes over internal organs, your addiction has seriously trumped your rational thought process.
Because addictions are so powerful, I suspect Americans will not give up shopping easily. Black Friday's numbers certainly suggest they are a long way from giving it up. That may be bad news for the long term, but for the near future it bodes well for the economy.
We have always maintained that there are two kinds of problems: those that can be solved with money, and those that can't. Resource shortages are an example of a problem that can't be solved with money. That will be a problem down the road.
However, unless consumers suddenly go cold turkey on shopping, recessions will remain problems that can be solved with money. With that in mind, the current crisis will end as massive amounts of money make their way into the pockets of shopaholic consumers. That's far and away the most likely scenario.
So for now, we will assume the economy will pull itself out of recession, and pull out with a bang. We think last week's gains signify that the lows are in. Setbacks this week or in weeks to come will be buying opportunities. We are still betting long-term on commodities, gold, infrastructure, and the strong re-emergence of economic growth. It's not a sure bet, but it is the best bet right now.

[Nervous Drake]

Re: consumer isn't dead yet

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[Nervous Drake]

Re: consumer isn't dead yet

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