$25 – $50 million = beer and pretzels
Archive for the ‘Money’ Category
How many different services advertise that they cost less than your daily cup of coffee? Of course, they don’t mean Folgers drip in your skanky old mug – they are referring to the $3-4 coffee at one of the ubiquitous coffee shops like Cairbou or Starbucks. Still…that doesn’t seem like much cash. But especially for students, it adds quite a bit to student loans, as Javanomics 101: Today’s Coffee Is Tomorrow’s Debt, points out in the Washington Post. I love cafes – I think they are great. But it is certainly a coup for coffee shops to have accustomed us to thinking that it is a trivial cost, when it really isn’t. We complain about movie tickets being $10, but that’s 2 hours of real entertainment if you don’t pick a dud. Everyone will always spend money on non-necessities, which is fine, but coffee as a daily habit can really rack it up:
To quantify the craziness, Lim distributes coffee-consumption charts. One shows that a five-day-a-week $3 latte habit on borrowed money can cost $4,154, when repaid over 10 years.
Maybe cut back to once or twice a week? It’ll make the trip feel more special, and you won’t regret it two years down the road.
Slate’s Savings Glut: The self-serving explanation for America’s bad habits discusses the theory that our economic problems are the fault of foreigners salting away too much cash for the future. The core thesis is that the US is virtuously propping up the global economy by spending like banshees, while too much saving in Asia is causing too little spending:
By running large budget and current account deficits, then, the U.S. acts like a sponge, soaking up the world’s excess savings and providing it with a decent return.
Maybe I’m old fashioned, but I’ve always thought that saving is a virtue. Save up, then buy. Makes things much simpler. Credit has its place for true investments like education, but seems to be used much more often to keep up with the Joneses.
The savings-glut meme changes the terms of the conversation about global imbalances. It’s not our fault that we rely on foreigners to fund our desire to spend in excess of our resources. Au contraire. Our extreme consumption and failure to save become something of a virtue. Somebody has to keep the world’s factories humming and absorb all the products made in Japan, China, and elsewhere. And until the rest of the world becomes More Like Us in its consuming habits, the imbalances are likely to persist.
I’m not so sure that the whole world should be just like us in terms of consumption. We certainly don’t seem much happier for it.