David Michael Bruno

High Hopes for U.S. Economy

Some stats about U.S. finances were shared over at the 100 Thing Challenge Facebook today. It got me thinking of doing a little calculating of my own. Here's something to ponder.

$233 dollar bills stacked on top of each other = 1 inch. So...

$14,762,880 dollar bills stacked on top of each other = 1 mile.

I'll be trying to climb Mount Whitney in June. It's the continental U.S.'s highest mountain at 14,494 feet or about 2.74 miles high. Measured in dollar bills, Whitney is $40,597,920 dollar bills high.

The Congressional Budget Office estimates that the U.S. will save $143 billion dollars by 2019 because of the new healthcare legislation. That's 3,522 Mount Whitneys worth of dollar bills stacked on top of each other! Wow.

Er, uh, well the U.S. debt is currently $12.9 trillion dollars. How many Mount Whitneys worth of dollar bills would stack up next to the current U.S. debt?

Try 317,750! That is a lot of Mount Whitneys.

Here's another way to look at it. $143 billion dollar bills stacked up would be 9,686 miles, or about the distance of flying from San Diego to London and then back to Chicago.

$12.9 trillion dollar bills stacked up would be 812,849 miles. That's about the distance of flying from San Diego to the moon and then back to San Diego...and then back to the moon...and then back to San Diego.

We've got a long way to go...

Housing Our Attitudes About Money - Portraits of Our Economic Meltdown

If you did not catch it this morning on your commute to work, make sure you take eight minutes to listen to this story from NPR. The report both chastens American home owners and also offers hope. I'm designating it the next installment of Portraits of Our Economic Meltdown.

I think perhaps the most troubling comment in the story came from Mrs. Moore who said, "I look at it this way: You're sitting on a bank, so if you can use it, use it because you can't take it with you, so enjoy it while you can." The sad thing about her attitude is that she seems to have mostly used her "bank" -- the fake equity in her overvalued home -- for charitable expenditures. She used it to help her grandchildren and to pay for the funeral of a family member. I suspect there were other meaningful uses of the money she pulled out of her house.

Yet it wasn't really money she was using. And that was the trouble with the sub-prime mortgage debacle. It is the ongoing fiasco of the American economy. Whether to buy BWMs or to finance a college education, Americans are not using real money for their lifestyle purchases.

If, for example, a BMW is out of a person's price range and the person really really wants to own one, then the person needs to adjust her lifestyle to work toward that goal (questionable though the goal be). She needs to get a career that earns the kind of money necessary to responsible afford a fancy car. Instead, the usual route Americans take to the BMW dealership is a duel-income household, insufficient savings, and lots of credit card debt.

The high costs of a college education, as another example, is a sign of some systemic issues in the direction that higher education is going here in America. And yet, that does not mean that parents should expect to use fake bubble money to finance the education of their children. This is a recipe for parents leaving no inheritance and adding the burden of their financial care to their children.

The inevitability of owning up to the actual value of our homes and our other possessions is that we'll have to admit that we are, in material terms, worth less than we have come to believe. It seems like policy makers are avoiding that reckoning. Best that individual Americans don't make the same mistake.

The Recession and Jobs - Optimism Now?

On my commute home something didn't seem right. I was listening to NPR (which I love and financially support) and heard a report filed by Frank Langfitt on the unemployment numbers released this morning. You can find the audio link and a redacted transcript, Surprise Fall In Jobs Does Not Dash Recovery Hopes. The text does not have it, but if you listen to the audio you might, like me, be curious with the way Christina Romer, chair of the White House Council of Economic Advisers, characterizes today's data.

She says that economic recoveries come in "fits and starts." The government revised the November data to show an increase of 4,000 jobs (originally a decrease of 18,000 jobs was reported). But the December numbers now show another decrease, this time of 85,000 jobs. Analyzing this, Romer concluded that, "November was a start and December was a little bit of a fit."

Huh? Isn't it the other way around? Wasn't November a little bit of a start and December a fit? (Maybe even, a big fit?) (How about a huge fit, if you consider that the real unemployment figures, the underemployment or U-6 numbers, went up to 17.3% in December.)

I have been noticing that some journalists reporting on the economy are speaking as if the recession is over. I am no journalist, but I do know that the recession ain't over until the National Bureau of Economic Research sings. Yes, I know that the NBER tends to make announcements after the fact. But the unofficial economic estimates of economists are not proving accurate these days. (Case in point, the $12.5 billion dollar discrepancy in consumer credit numbers. Or the fact that economists expected an increase in jobs for December. Or...you pick.)

Look, the other day I got accused of being a "positive thinker" by someone. Seriously, I am a die-hard optimist. Honestly. I think there are a ton of reasons to keep a smile on your face and a good attitude no matter what the circumstances. But call it like it is. The economy is in risky territory. Pretending otherwise isn't going to help.

If you've gotten this far, what's the upshot? Pay attention. Act like there is no recovery. Don't waste time. This isn't the season breathe a sigh of relief and go use a credit card. Stay frugal and keep finding ways to add more value to your family and community.

The Value of Average Folk

I am convinced that the average American can provide more value to the economy than purchasing a flat screen TV at Best Buy or shopping for bargains at Wal-Mart.

Don't let anyone tell you that you are only worth what you buy.

New Year Resoluthemes

For the new year I am resolving to live out some "themes" instead of specific goals.

Theme 1 "Controlled urgency" - I've never been a huge fan of "our times are more awful than other times" thinking. It can create irrational and unfounded panic. That's why I'm committed to controlling my hysteria in 2010. I am just going to calmly point my energy and time toward important life choices amidst twelve trillion dollars of ballooning federal debt, dismal employment numbers, my bankrupt state (CA), crooked financial institutions, and other impending disasters. I might bowl a few games on my buddy's Wii to relax. I'll keep surfing. But for the most part, 2010 is going to be a very very focused year. This is no time to screw around and waste opportunity. My prediction: Responsible living right now is going to pay back on an order of magnitude in a few years.

Theme 2 "Value creation" - I have this financial slogan: "Whenever we use our money and other resources well it is always good for our personal and national economies." I have not always done this. In 2010 pretty much everything I do will be subject to this question, Am I using my money and time well? If I'm not creating more value for my family, community, and the world then I'm not going to do it.

Theme 3 "Include others" - Yeah, I am going to nag you and everyone else I know. They say that "misery loves company," but so does joyfulness and thoughtfulness and responsibility. I've always been amazed at the things friends, family, and strangers will pull me aside to promote. They rant on about how fun Las Vegas is, what a great deal some timeshare is, how smart Sarah Palin is, how cheap Wal-Mart is, and on and on and on. I'm going to be less bashful about speaking up for the things I care about.

Now, regular readers of guynameddave.com may notice no direct social justice themes or religious themes among my three themes for 2010. I'll be working on specifics in those areas, as well as themes specific to family/parenting. And in the "value creation" theme there are several sub-goals related to writing and growing my guynameddave voice on topics like American-style consumerism. So there are specifics within the big-picture themes.

Thanks for reading and encouraging over the last year of the original 100 Thing Challenge. Looking forward to much more this year and down the road.