Quote of the Day -- Robert Reich

No economy can continue to function when the vast middle class and everybody else don’t have enough purchasing power to buy what the economy is capable of producing without going deeper and deeper into debt.

-- Robert Reich

Quote of the Day -- Edmund Burke

If we command our wealth, we shall be rich and free. If our wealth commands us, we are poor indeed.

-- Edmund Burke

Quote of the Day -- John Maynard Keynes

Markets can remain irrational longer than you can remain solvent. 

-- John Maynard Keynes

Quote of the Day -- Adam Smith

The things which have the greatest value in use have frequently little or no value in exchange; on the contrary, those which have the greatest value in exchange have frequently little or no value in use. Nothing is more useful than water: but it will purchase scarcely anything; scarcely anything can be had in exchange for it. A diamond, on the contrary, has scarcely any use-value; but a very great quantity of other goods may frequently be had in exchange for it.

– Adam Smith

 

Quote of the Day -- Edward G Ryan

The question will arise and arise in your day, though perhaps not fully in mine: Which shall rule — wealth or man? Which shall lead — money or intellect? Who shall fill public stations — educated and patriotic freemen or the feudal serfs of corporate capital?

-- Edward G Ryan

Quote of the Day -- William Jennings Bryan

There are two ideas of government. There are those who believe that, if you will only legislate to make the well-to-do prosperous, their prosperity will leak through on those below. The Democratic idea, however, has been that if you legislate to make the masses prosperous, their prosperity will find its way up through every class which rests upon them.

-- William Jennings Bryan, Cross of Gold speech

Quote of the Day -- Adam Smith

No society can surely be flourishing and happy, of which the far greater part of the members are poor and miserable.

-- Adam Smith

Quote of the Day -- John Maynard Keynes

Capitalism is the astounding belief that the most wickedest of men will do the most wickedest of things for the greatest good of everyone.

-- John Maynard Keynes

Pay It Forward and Philanthropic Shopping

On a whim, I decided to research the origin of the expression "pay it forward" and found an interesting article in wikipedia, my go-to knowledge source. I found that the expression was popularized by Robert Heinlein in his 1951 novel Between Planets:

The banker reached into the folds of his gown, pulled out a single credit note. "But eat first—a full belly steadies the judgment. Do me the honor of accepting this as our welcome to the newcomer."

His pride said no; his stomach said YES! Don took it and said, "Uh, thanks! That's awfully kind of you. I'll pay it back, first chance."

"Instead, pay it forward to some other brother who needs it."

The idea has blossomed into a movement and even a foundation. And like so many good ideas, it now seems like common sense. What good does it due to "pay back" someone who really doesn't need repayment. Isn't it far better to help someone else with the funds or influence when you have them?

And this got me thinking about shopping and whether there is a "buy it forward" equivalent. Searching for "philanthropic shopping" yielded retailers who specialize in fair trade goods or who donate a percent of their profits to charity.  But I'm thinking more of the trade-off between frugality and spending, when the spending might actually be a "buy it forward" gesture.

For example, I love to read. I love bookstores. And I'm seldom able to leave a bookstore without at least one new purchase. This feels frivolous to me when there is a perfectly good library close to my home that offers the convenience of reserving books online. And yet... I think there is value in supporting authors by actually purchasing their books. This is especially true for authors of somewhat obscure but high-quality books who haven't broken through the noise of the best-seller world. So I assuage my conscience by getting popular fiction from the library but purchasing quite a few books as well.

Similarly, there is a strong movement among the so called "educated elite" (and that label isn't considered a compliment by the labelers) to support quality journalism by subscribing to newspapers and magazines. Apparently, subscription rates are increasing, especially among millennials, who typically expect information to be free. Clearly, they are "buying it forward."

And finally, when traveling in developing countries, I feel compelled to purchase local arts and crafts. Of course, I love to have them hanging on our walls and adorning our shelves. But I also feel like I am doing good... buying it forward. And I've been "doing good" all over the world with my pocketbook.

Recently, we had the good fortune to make two brief stops on a southern Mediterranean cruise, in Tunisia and Algeria. In Algeria, we were one of the first large ships to visit and they were still gearing up for tourism. Our visit was heavily guarded and tightly controlled. We had absolutely no opportunity to spend a single cent. People were thrilled to see us and waved at our buses with appreciation, but I felt badly that I couldn't "buy it forward."

Worse, in Tunisia, we did have the opportunity to visit a village. We trouped through the streets, past many shops and stands. They were clearly delighted that tourism was resuming. But our leader took us to an "approved" store and gave us only a few minutes to wander elsewhere. I was devastated and felt like an ugly American. I think it was part of our obligation as affluent tourists to reward their work by buying some of their wares. When we returned to the ship, I went out to the stalls in the port and purchased several items. I felt a bit better but still gave my two-cents worth on my critique of the visit.

Maybe I'm rationalizing, but as someone fortunate enough to have disposable income and to be able to travel, I think that "buying it forward" is an important philosophy.

Quote of the Day -- Isaiah Berlin

Total liberty for wolves is death to the lambs.

-- Isaiah Berlin 
(Thanks to Jane Mayer, Dark Money)

Mostly Frightening and Aggravating, with a Dash of Humor

Despite being retired, we somehow seldom find the time to see movies in theaters. Last night, we saw "The Big Short." Just wow! I haven't yet read Michael Lewis' book, and now I probably won't. Even if the book is, as usual, better than the movie, I think that the movie was sufficiently careful and complete to satisfy my thirst for understanding this horrible chapter in our economic history.

For those of us who are fortunate enough to be a bit removed from the still stagnating economy and the plight of most of the middle class, the Big Recession is starting to feel a bit like a distant memory. But it's good to remember...

Despite the esoteric subject-matter, the story is completely riveting. Director Adam McKay uses occasional comic sketches to illustrate the most difficult financial concepts and to provide a bit of relief from the drama. The actors all turned in stellar performances. I have to believe that they "believed" in the importance of the story they tried to tell. 

This isn't a horror film in any traditional sense of the term, but at various points, fellow audience members gasped audibly. And we all left the theater shaken and angry (and better informed). The truly frightening thing is that I don't think we have learned very much from the experience of 2008 and the subsequent years. The financial fat cats are still at it, and we've done very little to rein them in and protect ourselves from the next bubble ready to burst.

Quote of the day -- Jeff Yeager

"The Joneses can kiss our assets"

Heard in an interview on public radia with Jeff Yeager (author of The Cheapskate Next Door).

I'm not a cheapskate and, in fact, excessive frugality really annoys me. On the other hand, I also get annoyed at excessive PDA (public display of assets), which is why I enjoyed this quote.