Hey, I'm spending hand over fist! B&H loves me.

Sorry to go off topic, but I wanted to mention that the 17-year-old boy and 17-year-old girl from Sheboygan who were charged with having underage sex both got one year of probation.

> B&H loves me.

Who's doing craft services?

I live on the Westside and so far I'm not seeing local businesses going under. My friends from Hamburg were here last week and everywhere we went, in Santa Monica and Beverly Hills, it was packed with people.
Apparently there is no fiscal restraint in this part of town.
I run a wholesale business and because I'm on the wholesale side I pretty much refuse to pay full retail on anything but food. OK, so I can't negotiate on prices at Trader Joe's, but if I could, I would.
When I see retail stores selling a $50 item for $500, I think that they kinda deserve to go out of business. You can't fault a business for pricing goods at as high as the market will allow....that is capitalism after all. But I wonder about consumers who willingly pay outrageous prices for items with little intrinsic value.

Belle -

People often pay inflated prices for things to brag to other people about how well they are doing.

Others like to get deals on things to brag about how shrewd they are.

Most people buy what they buy not because of price or emotional concerns, but because they believe it to represent a fair value.

Although I second your observation. If there's a recession going on, you wouldn't know it in central Connecticut. The restaurants are always full, the stores are packed, and there's lines at every register.

Great read here:

http://seekingalpha.com/article/127545-when-america-ruled-the-world-part-1

I want to write letters to foreign countries begging them not to buy any more of our debt, because that is the only way the United States will stop spending us into a hole that the taxpayers can never possibly repay.

In individual terms, I think this is like a person who keeps increasing spending even after he has lost his job, because after all he still has a credit card. Only when that card is cancelled will the spending stop.

I kind of hate to wish it, because it will hurt a lot of people. But it has to happen.

I can't be out of money. I still have checks left!

The problem isn't so big at restaurants and retail stores here, either. It's new homes, and home improvements, and automobiles that are not selling.

The trickle down effect is the killer. Our client, a large air conditioning manufacturer, is way down in sales. That leads to layoffs, and less spending on projects, so we take a hit. Automobile manufacturers are in the same boat, sinking along with their suppliers and dealers.

Then we get the tertiary effects. The tax on those evil Wall Street bonuses covered a significant part of NY State's budget. Deficit, which has to come from the taxpayers somewhere, because the unions will fight to the death any attempt to cut a dollar of spending. The market is down, meaning the civil service pensions are inadequately funded, so we get to make that up as well.

It'll get worse before it gets better.

"But I wonder about consumers who willingly pay outrageous prices for items with little intrinsic value."

Belle, for some people a designer label is a reflection of their self worth. I know that's nuts but that's the way it is for some people. I saw it first hand with my ex-gf. She had to drive a Land Rover. Only the "best" wine. Designer clothes. Rolex watches. Coach bags. We bought a condo together on Nantucket and she immediately had her address on her license changed to that address even though we only spent weekends there. She "had" to be able to show that she owned property on Nantucket.
I never once listed it as an address for anything.
I'll leave it to the psychologists to explain why that is.

"Belle, for some people a designer label is a reflection of their self worth ... I'll leave it to the psychologists to explain why that is."

I don't remember who it was, but someone here once made the astute observation that for some people life is a competition and money is the means of keeping score. I'd say it's a pretty common thing - ever notice how often someone is referred to as "successful" based on how much money they make?

I don't know if I'm as competitively-focused as some people are. But if so, the amount of money a person makes isn't my benchmark of how successful they are, but rather how little money they need. I most admire people with a lot of freedom and independence, not wealth. Of course we'd all prefer to live indoors and eat food, so we do need money to a point. But the people I envy the most are the ones who can do whatever they like and who can work when and if they feel like it - who are happy and enjoy the way they spend their time every day. Those are NOT necessarily the people who have or who earn the most money.

And for that matter, those Rolex watches and Coach bags aren't a sign of how much money you make anyway, just how much you spend. When you see someone wearing that stuff, you never know whether they are brain surgeons who make a bundle or whether they're just idiots who pay way too much in finance charges on their credit cards and live one paycheck at a shitty job away from bankruptcy. In which case I would see that as a sign of weakness or insecurity, not success.

You know, it's kind of funny that these kinds of things still convey status for some people, in the modern age of easy credit. When anyone can get a credit card and buy a luxury item, why do we still call them luxury items? Heh ...

> When anyone can get a credit card and buy a luxury item, why do we still call them luxury items? Heh ...

Good question, Pirate Jo. This is precisely why there has been "luxury" inflation -- and ever-increasing consumerism. Once, a color television was a luxury item, as was air-conditioning in a car.

Psychologists have revealed discouraging aspects of human nature and status seeking: everything else being the same, most people would prefer to make $50,000 than $100,000 -- so long as others' income is $25,000 in the first instance, and $200,000 in the second. In short, most individuals are actually happier with less, so long as that amount is more than what others have.

And the green-headed monster rises again.

That's all socialism is, really. Jealousy enforced at the point of a gun.

Yup ... being wealthy is not based on how much money you make, but how much money you have.

What's B&H?

You should have just resold your designer clothes on eBay - people are still buying stuff there. My husband and I are supplementing our income nicely with eBay. We go to thrift stores, buy like-new items for a couple dollars and resell them for 10 times as much.

My husband is just like the girlfriend w/ the name brands. Good thing he realized early on in our relationship that we'd always be broke unless I handled the money.
I'm cheap and I'm proud of it. Before anything is bought, I ask myself- DO we need it or is this just a want? Can we afford it or would this stretch our finances? Etc..
Like Belle, I refuse to pay retail. The internet is my best friend when it comes to finding things cheaply. I also won't pay full price for our groceries. (Coupons, Aldis and Save A Lot are my friend there.)
We live in an upper middle class community. Everyone here is still trying to outdo their neighbors, but we don't care.
Our neighbors drive Lexus's, BMW's, Mercedes, Jags, and Porches. We drive a Hyundai Accent. That we paid for out right.
We have used furniture and my house is decorated w/ thrift store finds. (Yes, it looks very nice. Nicer than some of my neighbors as a matter of fact.)
My daughter is clothed in on sale clothes and thrift store treasures. All name brand and all bought for pennies on the dollar. My husband and I are as well.
The only thing we do spend money on is our daughters toys and the husbands computer toys. She gets one toy a pay period, providing she does her chores and earns it. (She has a ton of toys.) He gets his toys and because he uses them for work, we either get reimbursed or get a tax credit.
I have a small business on ebay & online that helps bring in $. I do all the work myself and have negotiated better than wholesale prices w/ my suppliers. As a result, I'm able to pass the deal on to my customers. My profit margin is also higher.
Our greatest accomplishment is the purchase of our condo. We rented it for awhile, then bought it. Outright. Our savings took a hit, but it was worth it and they are getting replenished.
We have no credit cards and as a result, we have almost zero debt. The only debt we carry is medical from where my husband had cancer before he met me, and we almost have that paid off.
I don't have a cell phone because I stay at home and he has one provided thru work.
Our credit rating is shit because we pay w/ cash (Debit card) but we don't care. If it can't be bought with cash, we don't need it or want it.
Our daughters education is well on its way to being paid for and our retirement fund is doing ok. (She is five btw.)
The last thing I splurged on was a knock off coach bag. I don't particularly care that it doesn't look real. It was the only purse that I found that suited what I needed it for.
I grew up dirt poor and watched my mother still save .10 out of every dollar brought in. I took a lesson from her.
My husband and I are planning a huge splurge next year. We're planing on visiting Europe. *Providing I can find the absolute best prices.