In the words of former chairman Greenspan, "Irrational exuberance"!

Consumption is the problem, we consume too much. The products that we buy come in large quantities and so our impression is that everything is a plenty. We buy it in quantity because it is less expensive, but this is deceiving. The mentality is that it only costs a little more for a substantial amount more product. It's marketing and efficiency. Hmmm, efficiciency, this is only percieved because companies have been able to gain "cost" efficiencies by outsourcing. Outsourcing labor, manufacturing, operations, etc. all to our own detriment now.


I am a consumer. I am a very conscious consumer. And I am a very educated consumer. The companies now know this and it is getting tougher to satisfy me and so all sorts of value added things go into products because they were cheap, because they were outsourced. In the end though, the added value only got me to buy, but didn't actual give me any added value. I just thought, hey this one comes with this thing, so let's get this one. I took advantage of sales and deals even if I didn't need them; I just thought we'll use it eventually. Things like paper towels, diapers, basically consumables. I took advantage because this stuff was always in my face, from Target, Costco, Walmart, Staples, Circuit City, etc. in my mail, my e-mail, road signs, newspapers and on and on. So I stocked, and guess what? I"m still using this stuff two years later. I stopped consuming as much some two years ago. And I still have vast quantities of consumables, I think I have a supply of shampoo for the next 7 years. In hindsight, I think it was the smart thing to do since prices will start to increase and I always bought this stuff at a discount and it's all stuff I was using regularly.

I'm now in Europe and I gotta tell ya, Capitalism has a long reach. But the consumers here are not as experienced as Americans, but getting there. More importantly, Europeans know how to do without. There is no need to buy it and if you are going to buy it, it comes in small/er quantities. It also costs more, but in the end you pay for what you use. And you learn to conserve and it doesn't affect you one bit less. You can use less of everything and it has no impact on your quality of life, if that is what you would call it. The other thing is that there is a serious difference in pricing, advantages are taken! It could be time dependent (and I don't mean time to market; dependent) and it could be store to store dependent. I can't tell you how many times, I have paid one price for something only to find it cheaper somewhere else. This could also just be the learning process of knowing where to shop. But I'll tell you, I don't shop in ritzy places and I always look for a bargain. I suppose it is the lack of big chains, but this happens in the chains.

So, when things are good we consume and companies are more than willing to feed us the consumption. But this is the excess, this is the problem. We got more and more and more. Our cars got bigger and bigger and bigger and faster. And it got disposible, it is cheaper to just buy another one than fix it or send it in for repair or replace the batteries. In some respects quality got better, through design. And in most respects quality decreased. Things broke more often. But it was cheap so I never made a fuss. Where does all this trash go?.....

We fueled the economy. We fueled the economy with our "disposible" income, that we got through cheap financing and maybe our Home Equity lines of credit. We the Consumer. And the world was more than willing to go and get a piece of the pie. So, we got more especially when the Dollar was strong. And that inflated our deficit, so of course the Dollar had to decline. And then the Dollar declined and "We" got hit with layoffs, and a freeze on credit. But there is light at the end of the tunnel, the Dollar is climbing for a short while, only because the long reach of Capitalism has not really understood world Consumers. And so a retreat to the Dollar, of course, it is the currency most widely held and infused into other world economies. It's becuase the world is realizing that hey it's not just America, and America will fare better, I/we think.

So the breaks are on and so what, for those of you who were smart and stayed straight and true and kept your fundamentals sound, your OK and you will fare the weather. This means that the folks who kept that 30 year fixed mortgage and didn't tussle around with it; this means those that didn't out balance your 401k with solely risky equities, this means those who shopped for good car loans, this means those who didn't extend themselves too much and kept an eye on your credit scores, etc. etc. etc. For those who took risks and then took more risk and then more; like a gambler HOT on a winning streak; we didn't know when to stop and so now the House "Has you".

Well, not really. This excess was financed, the House doesn't have you and can't break your legs. The poor poor banks. I don't blame them. You can't sell drugs if there are no buyers. We are to blame. Guns don't kill, people do.