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Used Cars in 2010 July 21, 2009

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One of my co-workers has been spending time searching for a used car for her college-aged son. He was almost in an accident recently and the other car smashed into a median and she said it was totaled. This kind of freaked her out that his older model Grand Prix did not have enough safety features… air bags, anti-lock brakes, etc. All her searching has got me thinking… in 9 months, I will be turning in my lease for a “new” car.

I am not a big fan of leasing a car. It works for some people, but I really do not mind having a car that is older than 2-3-4 years. It may require a little more maintenance, but when you aren’t paying a monthly payment, I certainly think it more than balances out. We did it this time in an effort to actually save money during this short period when both the boys are in day care. (My last car was used as a trade-in for the lease and so we had no payments to make on a two-year lease.)

So, anyway, back to my thinking… with the auto industry the way it is and everything else going on in the economy, it is hard to decide what we should do… nine months from now. I think we are leaning toward buying a used car… preferably one that is less than two years old. And as much as I am loving 29 MPG I get going to and from work, we really need a seven passenger vehicle that can carry more than just the immediate family. At this point, the only vehicle on the market that can meet those two needs is a Toyota Hybrid Highlander. But, being in Michigan, it is really hard to feel good about driving a foreign car.

Despite it’s odd appearance, Kim really like the Ford Flex. Neither of us have driven one, so that would be the first step there. Of the Ford SUVs I have driven, I did not like the torque the engine seemed to have as the vehicle always seemed to really pull when you accelerated. I prefer a smoother ride in that way. I did like my Rendevous, but it has been replaced by the Outlook, Acadia, Enclave and Traverse – which are much longer and would fill up our garage big time, as would the Flex.

And there are couple of others I would consider, like the Chrysler Pacfica and Dodge Journey which seem to squeeze 7 people into smaller packages…. but who knows… what will be on the market then, what prices will they be going for, what quality/service issues will arise in the coming months as more dealerships close. I wonder if people in other parts of the country are considering all the factors that are going to affect the automobile market in the coming months or years. I know in Michigan, it is in the forefront of people’s minds.


The New Economy Dictionary March 13, 2009

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Another chain email, but this one made me laugh a little, so I thought I would put it up here. Just like Jay Leno coming to Michigan for a free comedy show, we all need a good laugh in these trying times.

    New Stock Market Terms

CEO – Chief Embezzlement Officer
CFO – Corporate Fraud Officer
BULL MARKET – A random market movement causing an investor to mistake himself for a financial genius
BEAR MARKET – a 6 to 18 month period when the kids get no allowance, the wife gets no jewelry, and the husband gets no sex.
VALUE INVESTING – The art of buying low and selling lower.
P/E RATIO – The percentage of investors wetting their pants as the market keeps crashing.
BROKER – What my financial planner has made me.
STANDARD & POOR – Your life in a nutshell.
STOCK ANALYST – Idiot who just downgraded your stock.
STOCK SPLIT – When your ex-wife and her lawyer split your assets equally between themselves.
MARKET CORRECTION – The day after you buy stocks.
CASH FLOW – The movement your money makes as it disappears down the toilet.
YAHOO – What you yell after selling it to some poor
sucker for $240 per share.
WINDOWS – What you jump out of when you’re the
sucker who bought Yahoo at $240 per share.
INSTITUTIONAL INVESTOR – Past year investor who’s now locked up in a nuthouse.
PROFIT – an archaic word no longer in use.

# # # # #
If you had purchased $1000 of shares in Delta Airlines one year ago, you will have $49.00 today.
If you had purchased $1000 of shares in AIG one year ago, you will have $33.00 today.
If you had purchased $1000 of shares in Lehman Brothers one year ago, you will have $0.00 today.

But… if you had purchased $1000 worth of beer one year ago, drank all the beer, then turned in the aluminum cans for recycling refund, you will have received $214.00.
Based on the above, the best current investment plan is to drink heavily & recycle.

It’s called the 401-Keg.

I am not sure of the origin, so I can’t give credit – hopefully this post is credit enough.

Unemployment in Michigan March 10, 2009

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Michigan’s unemployment rate released yesterday is now at 11.6 percent.

The National Rate is at 8.1. In the last 60 years, it has only been higher in 1975 (as high as 9.0) and 1982-83 where it got as high as 10.8.

And at this point, it looks like there will be some more changes coming with the Big Three. General Motors is the closest to being the first to surrender, but Ford and Chrysler are probably also on the edge. Even if one closes and the others do not, the number of car dealers, suppliers and other supporting businesses that would be forced to close their doors will still be enormous.

News Media Still Not Understanding the “New Economy” March 9, 2009

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I watched CNN’s “Money Summit” which was a roundtable of experts – talking heads – that jabbered on about how people are spending or saving, where jobs are going, basically what is going on with the US Economy. And they went round and round and still never got to the “problem.” I say “problem” when effect, it is really not a problem. It is more of a change – change in how the economy will be for years to come.

People are not spending because they don’t have jobs or are nervous about losing their jobs – Yes. However, the bigger issue, I think, with what is happening is that people are realizing that they borrowed money to buy things they didn’t NEED. A few years back in 2001-2003, we had a president who, in the midst of a milder recession told the country that they only way to get the economy back on track was spend. I feel bad for the people that gave into this.

I am happy to notice that our new president is saying nothing of the sort. I wonder if he and his administration have come to this realization yet. Our economy has changed. People go out to eat for special occassions. People buy clothes when they need new ones. We are no longer buying things because we saw a commerical or it was on sale – and never end up using. For one, we don’t see commericals as much. As hard as advertisers are working to catch our eye, with DVRs we can avoid them and I think we are just through with people being paid to tell us that we need something. We would rather listen to family, friends, and even online forums and message boards.

It will affect us all – buying only the things we need, means less STUFF – less people selling the stuff and making the stuff. I think we have entered a new age. It will be a simplier time. We will not spending money because we have it. We will be taking care of what we have and making the most of our lives with the people important to us – not the things we can buy.

The Rise of CSL (Chinese As A Second Language) March 5, 2009

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I heard two disturbing stories on NPR this week. I listen to several of their podcasts which combine stories of similar interest – like, Education, Technology and Economy. It really is a good way to catch up on important topics and interesting human interest stories. This group of stories was on the economy. The first one discussed how we have as much debt as we do gross national product. In other words, as a country we borrow for everything we have – if we produce $1,000 worth of products, we borrow as much from other countries.

And the second story goes to show who holds our debt. There is an organized program out of China where people come to the US to buy property. It is more affordable here than their homes in Shanghai. They buy them as investment properties or as future homes for their children.

The economy world wide has taken a turn for the worst in the last 6 months, but because we were already borrowing more than we could handle, Americans should expect that the result will be the lenders will be calling in that debt… I don’t want to go to far down this path, but I am feeling more and more like we need to start learning Chinese… and I stink at learning new languages!

How Bad is the Economy in the Midwest? August 6, 2008

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In case other people outside Michigan or Ohio doubted how bad we are doing…

6 Cities in OH and MI Among bottom 10

This election year is more an important than ever and we need to turn things around. Yes, turn things around, that means change. Change is hard, but it has to happen. We need to move away from politicians that continue to use tax breaks to lure votes and implement failed policies of exclusion and prejudice.