Category Archives: Economy

Links From August 11-27

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Something extra for you this week. Some links I really enjoyed the past 2 weeks. Decided I needed to post them before they become to old and irrelevant.

Robert Scoble on passionate user adoption and Ubiquity. This is just something that I enjoyed reading especially after using Ubiquity for several hours yesterday. If you want to use it I recommend reading the tutorial and watching the video.

An article, from Business Pundit, on the enlightenment complex that we see stateside also developing in the Chinese culture. A bit of an insight into why my generation, for the most part, feels so damn entitled. Also, suggest why depression is on such a climb.

This is one of several articles that prompted my last post. It is promoting some smart financial advice on steering clear of private lenders. However, it all so shows weak decision making on behalf of the government, in allowing people weakened by the subprime mess increased loans.

A really thorough and thought provoking conversation with Nassim Nicholas Taleb, author of ‘The Black Swan‘ and ‘Fooled by Randomness‘, provided by Portfolio.com. It looks into his life and how he removes the noise of now.

As somewhat of a bibliophile this last one is just an amazing list of 50 Essential Novels, provided by Leo Babauta at Zen Habits. It is such a substantial list of both classic literature and current hits that are certain to last for a long while. I recommend checking this list out if you enjoy reading.

College Is Taxing the System

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Something I’ve noticed the last week is that discussions on education have been popping up everywhere. Our economic system is facing collapse, and the main issues are all centrally connected to the way our secondary-education system is founded and unregulated. The payment of the tuition is resulting in the major collapse but no one wants to focus on it. You have parents taking out mortgages, the government heavily subsidizing tuition, and student lenders, all taking huge losses on college.

I mentioned this in an old post that was originally written in the middle of March, though it focused on only the government subsidization. The issue is not that government shouldn’t assist, but they are hurting themselves and the economy by not regulating school rates. Over a 30 year period they have wasted approximately $2.4 Trillion( with a T) on education. Meanwhile, college rates are rising doubly as fast that of interest rates.

The people who were taking out loans are hurting but if they claim bankruptcy that is only making it worse for everyone else. The students with 30 or 40 thousand dollars in loans are going to find it hard to pay back because of the weak job market, and the parents who took out mortgages are are probably hurting tremendously. Yet, today the NYT’s posted an article on how the lenders should be taking the brunt of this blow. By allowing the students to claim bankruptcy on these funds.

This article is fucking ridiculous( pardon my language) , this will allow for billions of dollars to be wiped from the slate. This leaves the lenders with no capital to provide for the future borrowers and no profit for their services. What needs to happen is a reformation of the collegiate system.

The problems of our current economic tumults are founded upon these 2 systems the collegiate and the lenders. They are the major issues that caused the collapse in the housing market collapse, outside of the pricing bubble. Colleges have been and will be taxing the lending system both private and federal, making it harder to produce revenues to reach the equilibrium needed. College is generally going to cost you more with less job security and lower standards of pay. Lenders are feeding on this fact for interest and fees.

So the point I’m trying to say, is that even if we find a way out of the housing bubble, we still have a huge problem. If we don’t do something to reform college funding we will see this strain the system to a point of another economic collapse. I can see this occuring anywhere from less than 5 years to 10-20 years from now, it will happen if we don’t do anything.

Your Pouring The Wrong Way

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[I’m sorry for any ranting and poor writing this subject is just to dire.]

Wednesday, June 23, the Housing Bill was passed through Congress and the House. I’ve reviewed what little information they are giving the public and it’s only going to affect a small majority of homeowners, approximately 400,000. The main benefactors to this bill, however, are Frannie, Freddie and other lenders. The fact still stands that overtime the average American is going to be taxed for the problems of others

The bill will offer bailouts on houses up to $550,000 which in most cases would be relatively higher than median pricing in any area,  with exceptions for a few areas (i.e. California). This is just ridiculous; if you’re going to offer this to former defaulters you’re a fucking retard, or a member of Congress. This is a horrible incentive to be offering, it’s just going to show them that they weren’t responsible for their problems, each party will point the finger at the other.

I think someone should have thought this thing through, at 600 pages you would think that it might be worth something, yet nothing except tying the government to corporations. I think if anything we need to bolster economic centers of growth but we can’t be bailing people out for every problem, yeah I’m calling you out Dems. We need to develop a plan that can actually help rather than just boost morale for a few months. We also need to show that we don’t support weak economic decisions by people, how about starting to teach basic personal finance and economics in our Middle and High Schools.

Our lending market filled itself with greed and ditched common sense; they offered poorly qualified people opportunities that they could never afford. These people only thought about margins and not about the chance that everyone else would be going after the same niche in the market, sub-prime borrowers. Now we, the American public, get our asses taxed off until we default or our jobs get taxed to the brink and they collapse leaving us jobless and then we default. This isn’t going to help it’s just there to ease the trip down.

So it looks like I’m going to have fun as a responsible spender over the next several decades. Hooray for the assholes back in the 90’s and early-oughts, for flipping me and my generation over and fucking us in the ass. It really fucking stings to know that simplicity and release from branding, no matter how non-conformist, doesn’t help you separate far enough to escape bailing out the people bound to consumption. It’s time to stop praying for the money to come in, and learn responsibility for your actions.

Education Pt 2 – Personal Economics, Subsidized Education, And the Morality Of It All

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Originally Posted on a defunct blog: 3/15/08 Update: First paragraph is heavily flawed after I altered the original math to make it more simple, by adding a link to an outside source, the link is valid just not for this case.

First unto the personal economics, I’m going to defer this to another persons observations. Now of course this is merely a perception on how well you can do with a High School Diploma(HSD) compared to a B.S. The HSD will have roughly a 8 year head start over the BS; as such the BS would have to be putting roughly 2 to 3 times that of the HSD for roughly 1.5 to 2 times longer, just to be roughly even.

Now on to the topic of Subsidized Education. This is the act of the government providing grant money to help students attend college. The government in the past few years has spent around $200 billion annually towards higher education; this can be tracked back for nearly a half century $7 billion in 1965 to $170 billion in 1995 so on average we’re spending $100 billion annually for the last 30 years and with a 60% failure rate. We have wasted $2.4 trillion dollars on education, roughly one-fifth of our national debt. This has caused an effect that has allowed the colleges and universities to raise the price of admission drastically, hurting the middle-class.

Morally, I feel that we should remove subsidies in the education industry. In removing the subsidies and regulating the amount that a school could charge we could gradually reach an equilibrium and prevent the facilities from relentlessly raising tuition rates. In doing this, we would help the economy by stabilizing wages and allowing our country to slowly shift more towards productivity.

Now how do we become more productive. We gradually have more citizens filling the roles of the illegal immigrant laborers, the current state of our nation is that we are a nation of hedonistic intellectuals when our society needs physical labor, not mental. If you were a true intellectual you would develop your skills and let yourself be discovered by others. If you aren’t willing to express your intellectual capacity your have yet to realize any dream requires will and determination.

This is the nation of freedom and dreams that our forefathers fought for, our rights and dreams, with their blood, sweat, and tears. Yet, we have become a nation of daydreamers who don’t have a clue about what true labor is. Working men founded one of the strongest nations and we, their heirs to this land, have become the hedonistic clan to lead the United States down the path of Greeks and the Romans. The greatest empires fall when they believe they are greater than all others, another shall rise with a dream and and prove them wrong.

So do you have the will and determination to follow through with your dreams?