The Double A Lounge

Everyone expects that the President of our country will have all the magic fixes for what ails our economy. He would certainly like to think so. So would the two contenders for the upcoming election as well. The reality is that whatever they have proposed thus far would only be a drop in the bucket and make little difference. It’s a worldwide problem on a grand scale far beyond our reach to fix as this article shows:

So far, neither of these textbook measures has worked—for reasons that
have less to do with flaws in the design, time, and sizing of the
policies than with global macroeconomic factors far beyond the control
of the Federal Reserve or the White House. As we noted last week,
there’s a good case to be made that the stimulus is essentially being
eaten up by higher gas and food prices—prices that are being driven
higher in large part by a weaker dollar and strong global demand.

The economic stimulus check was nice to get, but it will never even come close to fixing the problem.

The economy today is being buffeted by a popped domestic housing
bubble, which is deflationary; a global demand shock for food and
energy, which is inflationary; and a credit crisis, which
simultaneously inhibits consumer spending and makes capital more
expensive. There’s no effective short-term fix for any of these
problems.

Sounds like stagflation to me. This article about stagflation backs up my case:

Rising prices and rising unemployment are two of the data points
used in attempts to determine whether stagflation is threatening the
economy. While hikes in the cost of food, energy or other individual
items are generally not perceived as signs of stagflation, a
broad-based rise in the cost of goods and services is something to be
concerned about.

Well there must be a solution, right? Maybe so, but this one from years past may offer some insight:

An effective method of addressing stagflation once it occurs is equally elusive. During the 1970s, stagflation persisted in the U.S. despite the government’s
best efforts to contain it. The trend was finally broken when the
Federal Reserve hiked interest rates to the point where borrowing was
impossible for many segments of the economy, and the country fell into
a deep recession.

Problem is that due to the way stagflation is measured, we are no where near that point yet. We are in economic shock, but not considered to be in the throes of stagflation.

Recently watched a DVD with someone who now owns a Nintendo Wii game console. The DVD was about something called the Wii Fit. I was intrigued about it since the picture had shown people exercising. The Wii Fit is designed to make exercising into a game of sorts. You have muscle workouts, aerobics, balance games, and even yoga. You actually have to earn points to unlock other activities. Starts with a weigh in and a bunch of questions about yourself. It comes with the Wii Balance Board show below.

Here is some more information and reviews about it:

Wii Fit Wikipedia entry

Weighing Wii Fit: Serious Fun

1UP.com Review (good pics)

I’m going to be very interested in trying it out. If it makes exercising more fun then I’m all about it. Should be released here on May 19, 2008 and supposedly retails for around $90.

Here is a nice video about it:

Wii Fit — full trailer from E307

With gas prices rising by the day, I think the $4/gallon day is becoming a reality. Motorists are not happy at all. So people start wondering what to do about it. After all, aren’t all these oil companies making record profits off this? If that’s true, then why not hit them right where it hurts. I found these two articles explaining why some of the tactics we think would work would not.

Oil Strikes and Gasoline Buyouts

A cap on the price of gasoline is a bad idea…

The problem is more complex than we’d like to think it is. It also doesn’t help that we don’t have enough oil refineries making gasoline. As this article points out, it doesn’t help when the price of crude oil keeps going up and consumer demand is plummeting.

At Valero, the nation’s largest independent refiner, first-quarter
profit melted by 76 percent. Its refining capacity allows it to process
heavier grades of crude oil that typically trade at a discount. Still,
its profit dropped to $261 million in the first quarter compared with
$1.1 billion last year.

Hard to justify building more refineries when it could be a money losing operation.

I think most everybody not in vacuum these days is aware of all the hype surrounding Apple’s iPhone. It’s supposed to be the best thing since sliced bread as far as cell phones go. So much so that lots of people are taking their hard earned cash and trying to buy one. Noticed I said “trying” to buy one. As noted in this article, if you want to buy an iPhone you will need a credit card to do so. They refuse to accept cash as payment for these. Apple claims it’s to discourage people from buying them in bulk so they can resell them. See, the catch with iPhone is that you have to use it on AT&T’s cellular network. You can’t take it to any other provider and get it to work. Supposedly there is a way to unlock the phone so it could be used with other carriers and that’s why people are reselling them. A quote from this article outlines how much people wish to unlock those phones.

One million iPhones, or 27% of those sold last year,
have been adapted to work on other networks, said Bernstein Research
analyst Toni Sacconaghi.

Other carriers would love to offer this phone to their customers. Apple was counting on the revenue generated from allowing AT&T exclusive right to sell service on the phone.

Mr Sacconaghi said the high number of unlocked iPhones
in the US would be a concern for Apple, as it receives a percentage of
AT&T’s contract fees from iPhone users.

He estimates that if Apple sells 10 million iPhones in
the US by the end of 2008, but 30% of them have been unlocked to work
with other phone networks, Apple will lose $500m (£251m) in revenues.

I can see the steam coming from Steve Jobs’s head all the way from here.

I’ve noticed over the years of listening to music and researching the people behind it that regardless of what genre I listen to, many of the musicians involved have all played with each other at one time or another. I like finding out who actually played on an album or song or who wrote the material. It’s always the same people I find who work with each other. You find a lot of this in progressive rock music. Many of the groups had shifting lineups with many different people. Many times they help out out on solo projects for current or past members. The examples would be too numerous to mention here. There are a number of A list studio musicians who have tons of credits on many different albums. You could even do what the progressive rock group Yes did in 90’s and merge all the different lineups of their group since they started and have them play on one album. They even toured for the album too which is quite amazing. The end product had some interesting moments but really it fell apart. Too many egos and too much meddling from the record company ruined all that. I bet someone out there actually has created a family tree of different musicians and how they relate between different groups. Read the liner notes on some of the music you listen to and you might be surprised.

Here’s a concept: your kid wants to go to his or her school prom but in order to do so, you as the parent or guardian must attend a special meeting hosted by the school on drug and alcohol abuse. This school has apparently caught on to that idea. Regardless of this meeting, the parents that care will do what they can to make sure that prom night goes without incident. The parents that don’t care will either end up making a middle of the night visit to the police station or end up picking up their kid from the prom for being kicked out.

I think they should have gone a few steps further by making sure to emphasize that there was no need for their child to have to miss a day (or two) of school to prepare for the prom. I’ve even heard that some schools have been banning limousines and after prom parties. I’m all for a special prom night, but I’m not for hearing how kids end up in police custody or worse, at the hospital emergency room.

As I go through all the blogs that give out advice on personal finance, this one certainly caught my eye. There has always been solid advice on what to do with any credit cards you have. The best thing is to not have any at all but let’s face it - there could very well be times when it will be needed. The idea presented is interesting because it does provide you with a way to stop using your card needlessly yet still makes it available for a true emergency. I guess you could use it as a litmus test for how bad you are with credit cards if you find yourself thawing and refreezing it all the time.

I propose going one step further. Why do something like bury it 6 feet under in the yard or put it into a big vat of used cooking oil like the ones fast food places fill up with the oil from making french fries.