Monday, January 28, 2008

The Housing Market of Cards

The news of the day is that new home sales showed their worst performance in 16 years in 2007. This is only in addition to all the mortgage defaults and tumbling prices for homes going on.

60 Minutes did a report on mortgages last night, focusing on Stockton, California, where a lot of the skyrocketing housing prices started. They had a map showing houses that were starting the foreclosure process, houses that had gone into foreclosure, and houses that went up for auction but did not sell. The map was full of blue and red dots.

So it's evident that a lot of people are going through hard times. I've talked to so many people from around the country lately who have said that they are having trouble making ends meet, they need to save on groceries, etc. A lot of them are homeschoolers so they generally try to get by on one income or have a small part-time income from home, but one person's story really caught my eye - her family was a two-income family, and her husband was considering looking for a second job because they still were having trouble... they were already behind on their mortgage payments and were having trouble paying their electric bill and the like. Made me feel fortunate.

A lot of factors have contributed to this. People were getting adjustable rate mortgages, figuring that they'd refinance later when the rates went up (but the party stopped before they had the chance). The costs of the most basic things you need to survive, like food, gas to get to work, and energy to heat your home, have continued to go up, while wages have pretty much stayed the same. Skyrocketing property values have added to the problem by increasing property taxes. I know that our property taxes have gone up $200 a month in the 2 years that we have lived here, and our house is only worth $150,000.

There is one thing that disturbs me in all this, and one thing that I think is just plain ridiculous.

The disturbing thing to me is the people that can afford to pay for their homes, yet they are walking away from their obligations because their home is worth less than their mortgage. I've signed one of those mortgages (and the billion pieces of paper that go along with it) and I didn't see anywhere in there that you can just decide to stop paying if your home goes down in value, rather than up like you expected it to. Sometimes that happens, that's the risk that you take when you buy a house. If you think your house is overvalued at the price they want for it... don't buy it. It's a little like the stock market... if they are selling shares of a stock at more than they are worth, it is foolish to buy.

A lot of people lost their houses during the Great Depression, but it was not their choice. They saw home prices fall too, but their mortgages were also remaining the same, just as they are today. Unfortunately, a lot of people were losing their jobs and were given pay cuts and/or a reduction in working hours, so many couldn't continue to pay for their mortgage. People like the couple on 60 Minutes, who decided to stop paying for their house because it was worth less than their mortgage, probably existed, but there was a lot more shame to not paying your debts back then, so most didn't default of their own free will.

The other thing that is bothering me is the number of houses that the banks can't sell at auction, and therefore are just sitting there. ??? What are the banks waiting for, for housing prices to go up again? It makes just about as much sense as spraying a field of crops with poison so that nobody will eat it, when there are starving people out there. Perhaps they should consider auctioning them at whatever market value will pay for them, rather than holding on to them in the hopes that they will be worth more later. 60 Minutes showed some people being given a tour around foreclosed homes... one of the tour guides said something like "the price has been recently reduced, now it's only" and then he gave a price that was slightly over $300,000. That's why they have so many homes up for auction that won't sell, if they're still expecting people to pay that.

Of course the one downside of selling the houses, no matter what the price, is that the price that people are willing to pay might turn out to be a lot less than what the houses around it are supposedly "worth," which will just cause their property values to go down, which will make more people voluntarily give up their homes, which will cause property values to go down perhaps some more. Which was a cycle that occurred during the 1930s, when one house sold for a ridiculously low price that was below the mortgages on the other houses, the other houses were automatically worth less.

Some of the biggest losers in this whole mess are those people that decided to invest in REITs (Real Estate Investment Trusts). Anybody remember a while back where you'd see these advertisements about investing in real estate, but you didn't have to even buy a house? They saw quite a loss in 2007. If you had them, hopefully you got out when things were still good.

We're probably in for more rocky days to come. But it's probably needed to balance out the insanity that has been going on for so long. Not that balancing is fun.

Sunday, January 27, 2008

Render Unto Caesar

Every once in a while, you go to church or you're reading your Bible and you run into something that makes you say "wow!" Today was one of those days.

Most people that have any sort of rudimentary Christian background have probably heard the phrase "render unto Caesar the things that are Caesar's and to God the things that are God's." And lots of people know that Jesus was talking to some of the religious people about whether they should pay tribute, or taxes, to the government. There are some people out there that like to argue that you shouldn't pay taxes, but they tend to be on the fringe and a lot of them are in jail.

What reason does Jesus give for knowing that the coins belong to Caesar's? Whose image is on the coins? Caesar's. Because Caesar's image is on the coins, we are to render them unto Caesar.

But what if you put that into context Genesis 1:27?

So God created man in His own image; in the image of God He created him; male and female He created them.

~ Genesis 1:27

Whose image are we in? God's. So doesn't that mean that we should listen to him... or render unto God's the things which are God's?

Just something interesting that I saw today.

Saturday, January 26, 2008

Hope In Troubled Times?

When I think about the major news stories of the day, it makes me want to pull my hair out. The world situation with Iran, North Korea, China, and Russia showing their muscle could be a potential headache waiting to happen. There's the whole situation with Mexico (maybe we should add them to the above list), where not only do we have their citizens demanding to use our schools and health care, armed military officials cross our border on occasion and we do nothing about it. Then there's the economy, which who knows whether it will get better or it will get worse, but the "econonomic stimulus" package is going to weaken our dollar even further... and right now even a lot of people with jobs are having trouble trying to make ends meet. Aaaack!

Oh yeah, and there's that little thing about the Constitution... sometimes it seems like it isn't worth the paper it's written on any more. Maybe it's more like a cool artifact rather than a document that our country actually lives by.

It seems like the Lord should be coming down at any minute to come and rapture us all out at any second. But can we really know the date and time? Gregory of Tours wrote in his The History of the Franks in the 500's that he thought that the signs of biblical prophecy were being fulfilled and they were in the last days even then.

But a history book that I'm currently reading is bringing me hope. I'm currently reading The Forgotten Man which discusses the Great Depression. It seems like they were going through a lot of what we are going through right now.

Well, not the Mexicans on the border thing, but they did have immigration. They had Hitler coming to power in Germany. Mussolini was doing his thing in Italy. Stalin was remaking Russia in the model of communism. Of course we all know what the result was of that... World War II.

Economically, things were dismal. People were losing their houses right and left because they couldn't afford to make house payments. Jobs were laying off workers. People were finding it hard to make ends meet. Much more so than is happening now. Times were rough for a lot of people.

This is the stuff that most people learn in their classes in school, if they go to a decent school and actually pay attention. But by reading this book, I'm seeing that there are a lot more similarities than I had ever known.

Government was taking away freedoms, and people were wondering if Roosevelt was going to be a dictator and the Constitution was turning out to be a meaningless historical document. Andrew Mellon, a very wealthy guy who now has all sorts of things named after him, was being taken to court by the government for not paying his taxes... even though at the time he had taken certain tax deductions, they were perfectly legal. The government was pushing power companies out of business with their Tennessee Valley Authority (TVA). The government even passed a law saying that customers who went to a butcher could not even choose the chicken that they ate for dinner that night. I've never gone to a butcher and told them to kill a live chicken... that's a little foreign to me... but not having the choice as to what product I purchased at the store seems quite un-American to me as well.

Things seemed pretty bleak at the time. And I'm sure things were rough. The people that lived through the depression went right from economic hardship to the hardship of a world war. But after all that... people seemed to do okay in the 1950s.

I don't have a magic crystal ball that can tell me if the economy is going to get worse or better, if any of the threatening countries will rear their ugly head and the world erupts into a full-blown World War III, and I can't tell you if Islam will try to impose Sharia law in places that were once thought of as Westernized or even Christian. But I do believe that we can learn from history... and what I think can be learned from this portion of history is that even when things seem to be at their worst, and all hope is gone... things can miraculously emerge better than ever.

Obama and the "Race Card"

This is not a commentary on the politics of the Democratic party of of Barak Obama... I'm not even really sure what he stands for, other than "change" anyway. But rather an observation about race.

Why is it that the Clinton campaign seemed to bring up the "race card" first? Is it perhaps because Barak Obama is not really black? Let me further explain.

Barak Obama's father is from Kenya, so he is part black. But his mother is a white-girl from Kansas. To say that Barak Obama is black is a slap in the face to the 50% of his genetic makeup that did not come from Africa. He is every much a white person as he is a black person... he is biracial.

My two children are biracial. I never refer to them as black. They are not. If I need to refer to them by description, I'll say something like "he's the little tan boy over there" or "my daughter is the little tan girl." Tan is a color that describes their color.

They are not black... in fact, they have more European DNA in them than African DNA. I'm about as European as they come... every single one of my ancestors have been in America for five generations, and at that point, some of them immigrated here from Germany in the 1800s. Some of my ancestors have been here in America for 15 generations... they came from England to Jamestown in the 1600s. I've been an amateur genealogist for about 15 years, and I know that I'm about as European as they come. One of my ancestors did come from Italy in the 1100s, lol. But that's still Europe. My husband, on the other hand, is NOT as African as they come. He does have some French DNA floating around him. His family comes from Louisiana, and that's where the French comes in. So to say that my children are black is a lie... they are more white, more European, than they are African.

In Barak Obama's case, his father comes from Kenya, so he might not have any European blood on his father's side. But he is 50% white.

Sometimes I wonder, what are we, back in the slave days? Because back then, if your great-great grandpa was black, and every other member of your family was white, you'd still be considered black. That's not black, that's mostly white.

I know that it's easier for most of the media, and probably for many Americans, to see the world in terms of strictly black and white. But it's not that way, especially now. Even those little demographic boxes that ask you what race you are are starting to catch up. 15 years ago, most of them would say "check one", but now, more increasingly, they're starting to say "check all that apply". Which is how it should be... if you're going to bring race into the equation at all.

The country might be fawning all over themselves, congratulating themselves on how enlightened they are to have a "black" person running for president, but they have a long way to come. Maybe when we stop forcing people into boxes that they only half-belong in, we can start congratulating ourselves.

Thursday, January 24, 2008

The Best Explanation of Tithing I've Ever Heard

January is always tithing month at my old church. While every service included a mini-sermon on tithing "if you don't tithe God can't bless you", a special emphasis is placed on tithing in January. Every single Sunday school lesson, and a few church sermons, are devoted to the topic. Have you ever tried to explain tithing to a Kindergartener? I have. My Kindergarten-aged child still doesn't really know the difference between a dollar and a penny... and we've been counting money nearly every day since October!

If you were having any problems in your life, my old church would ask "do you tithe?" It doesn't matter if your income is $3000 a month and your bills and necessities total $3100 a month, the solution to all your money problems is to tithe.

Every week you'd hear testimonials about how people were in debt and they started tithing, and a year later, they're magically debt-free. I'm sure that their stories are true, the people with the testimonials were trustworthy people. You hear over and over again "everybody can afford to tithe, because it's the FIRST 10% that goes to the Lord."

Okay, that's fine and good, I'm sure that I can give the first 10%. Even on the whopping $1500 we made this month, I could give $150 of that to the Lord. Then you have the mortgage of $1000, and I'm left with $350. My electric bill was $150 this month, so that leaves me with $200 to pay for gas, food, water, sewer, trash, the car payment, etc. It doesn't really work out, does it?

This month is an extreme example, but the $3000 for $3100 in bills is not. I'm sure that God could be a magic money machine that could provide me with an extra $444, every single month, so I can afford to tithe when ends don't meet by normal means, and I'm sure that there are some people out there that have a lot of faith that can make it work... but I'm not one of them. I see the Dave Ramsey budget laid out in front of me and I shake my head and say "it's not going to work."

We were talking about tithing at my new church, which is not something that my new pastor normally talks about. He said that the one time he did try preaching about tithing, someone had a heart attack or something like that, so he took it as a sign that he shouldn't preach any more about tithing, lol. But we had a Sunday school topic on it, so he gave a really good explanation, of what to do when your income doesn't cover, or just barely covers, necessary expenses like food, transportation to get to work and church, your bills, and a place to live?

He said that sometimes people get off the path, and then they want to start doing the right thing, but it's not always something that one can do overnight. Getting to the point where you're living beyond your means is one of those things. Or in our case, we were once living within our means, but our income was slashed, but our bills did not decrease. When we realize that we are living beyond our means, we need to repent of it, and then do whatever we can to get to the point where we can tithe. It would probably be a worse testimony to the Lord if we decided to tithe all of a sudden and stopped paying our mortgage as a result.

Not that we should go out, when we can't afford to tithe, and buy a new set of cookware or some fancy gizmo that we see on television when we can't tithe. We need to do what we can to tithe before we start buying those extras that we don't need.

It makes a lot of sense to me. I know miracles happen... my nephew is having a birthday party on Tuesday, and we really didn't have enough money to buy a gift for him. What do you know, the $25 Target gift card that I won back in November showed up today, so I can get a box of diapers and a present, without spending any money.

Maybe I should believe that God will show up on my doorstep magically with $1500, but unfortunately, I don't.

Wednesday, January 23, 2008

Low Income Misconceptions?

I just got my power bill today and was shocked. $150 in the middle of the winter? And we were gone for 2 1/2 weeks of that time. Yikes! They are also planning another rate hike in the middle of the summer... just when everybody in Arizona is at their peak power consumption. Ouch.

Everything is so expensive. We're current on all our bills right now, but with the horrible economic luck that we've been having in the past year, I'm starting to hope that we don't end up losing our house. That's probably not something that will happen, but it's not like the overall picture for America is doing so well either. Dh has a current temp assignment for the next 2 weeks, but it doesn't pay well, and after that, who knows?

So I saw that the power company has a program to help people pay for their electricity. We fit the income guidelines... for the past 2 months we're under the income cutoff by $1000 a month. Yikes! The cutoff is at 150% of the poverty level.

We should be over the cutoff if/when dh gets a permanent job. If you're the praying type, he really is hoping to get a job as a 911 operator. He'd be great at the job... he doesn't have much compassion so he could remain fairly calm when taking just about any sort of phone call. I don't mean the compassion thing to sound negative, he'll admit it to your face.

So I guess that in our current life circumstances, we'd be considered to be low-income. But that's all just a number. I don't feel like I'm low income. And perhaps that's because there's a lot of stereotypes that come with the label. So I guess that this post is to perhaps dispel some misconceptions...

- You don't have to be uneducated to have a low income. I have a college degree and dh is working on one.

- Your income doesn't necessarily determine what you have. My mom used to work at the food bank where I grew up... she worked there for years. She would complain when people would come down to the food bank, yet still buy lottery tickets or play Bingo. While both are probably stupid ways of spending your money and are definitely not the best thing to do with your money if you have to go to the food bank, would doing either once a year be such a bad thing? I guess that depends on your view of gambling.

But we have lots of clothes and both of my kids have tons of toys. My parents are generous at Christmas. I have a whole closet full of clothes. Some I've had since high school, some I bought when I was in the military or in college, I won some, and I've bought a few things in the past few years.

- Income doesn't necessarily go up. In our case it's gone down. In 2003 it was a choice because we believe that homeschooling is important and being there for your kids is more important than money. Which is why I chose to leave a job that paid me more than $6000 a month (plus all the other military benefits) to go work at Kindercare for $7 an hour.

- Your income doesn't mean that you're lazy (or conversely, hard working). Ever work at McDonald's? That can be a tough job, but it doesn't exactly pay a whole lot. I'm sure that picking lettuce is not a walk in the park either. My husband goes to school full time, and usually works full time. Sometimes people just get unlucky. I read the book Nickel and Dimed last year... most of the people that the author worked with worked very hard.

I suppose we may end up with $14 knocked off our power bill in a couple of months if we continue to hit rotten financial luck. Woo. And I get a little help paying for my kids to go to the doctor. But this should all be temporary... even if our country does go into a recession/depression, countries always come out eventually. But the way that some people would have you thinking, anybody who falls into some rotten luck should be sterilized to prevent them from having any more kids, they should never buy fancy name brand food (although often this is the food you can get for free or dirt cheap if you buy it on sale with a coupon), and you should always drive an old beater, even if you know nothing about cars and having a reliable car to get to work is important to keeping a job.

I once knew a guy that was a Lieutenant in the Navy Reserves who lived in a car. That was his choice. Income is just a number... and that's about all it necessarily says.

Tuesday, January 22, 2008

35 Years of Murder - Roe v. Wade

This morning as I was driving my daughter to the dentist, I heard on the radio that this is the anniversary of Roe v. Wade. I looked it up and it is the 35th anniversary of the Supreme Court's decision.

Back when the law was created, we didn't have all the fancy ultrasound machines that we do now. I suppose that the ignorance of the day could have been excused to some degree, but it's hard to look at today's ultrasound pictures and not think that a fetus is just as alive as a baby. I had the opportunity to go see Bodyworlds 3 last year, and they have a fetal display... it is amazing how defined a baby's features are even at 8 weeks gestation.

In the last 35 years, millions of people have been killed for various reasons. Some were raped, some were forced to by their parents, some had health problems, some didn't want to tell their parents. Whatever the reason, the way that we react to the preborn has changed over the years.

  • A girl can choose to have an abortion, or she can choose to have an abortion and make the father pay child support. Over the years, the argument of father's rights has developed... why can't the father choose to renounce the rights to the baby and choose to not pay child support? We seem to think that it's "my body, my choice" but it doesn't extend to "my wallet, my choice" for the fathers. I'm against abortion, but it does seem a little unfair to the guys. If abortion wasn't available, as it used to be, there wouldn't be this argument.

  • Adopting a baby is not an easy thing to do. If you want to adopt a healthy infant of the same race as you (and you happen to be white), you can get on a waiting list and hope and pray that you'll get your chance someday... after shelling out thousands to tens of thousands of dollars. I wasn't alive before the Roe v. Wade decision, but somehow I doubt that there was a dearth of healthy babies waiting to be adopted. When teen girls used to get pregnant, often they would go away to "visit an aunt" or something for several months, and come back after having the child and adopting it out.

    A lot of people that are in favor of abortion use the argument that "there are so many unwanted children in the world... abortion just keeps another unwanted baby from being born." While it's true that there are many unwanted children out there, most of them are not healthy newborns, which is what a lot of the parents facing infertility are trying to adopt. Many of them can't any more, because they can't afford it.

    Adoption nowadays just seems to be something that most people don't even really consider. You either want the baby and you have it, or you don't want the baby and you abort it. Not many people have the courage any more to go through with a pregnancy just to give it to some strangers that really want to have a child but can't.

  • Premarital sex is something that is easier to hide from your parents. The availability of birth control aside, if you get pregnant nowadays, you can just "get rid of it" by going to Planned Parenthood, and your parents never have to know in many cases.

  • Babies with birth defects (or suspected birth defects) are less likely to be born. You can have tests to screen them out. Sometimes the tests are wrong, but even if the test wasn't wrong, is it right to say that you don't want a baby to live even if it is not perfect?

There are truly cases where the mother's life is in danger and there is absolutely no way that the mother can survive without an abortion. Tubal pregnancies, for example. There is no way to save the baby's life, because the pregnancy in the fallopian tubes would cause both the mom and the baby to die. But there's not much controversy surrounding that.

Neither is there much controversy on doctors using abortion procedures, the D&C, D&E, or D&X, in cases where the baby has died and there is an inevitable miscarriage. Doctors that don't perform those procedures on living babies will perform them when the mother is waiting to miscarry. It can be a lifesaving procedure in these cases (without this procedure people sometimes could bleed to death)... I happen to be one person whose life was saved twice by this procedure, even though I was hoping that I could miscarry naturally.

There is also the abortion drug out there, RU-486, which was not available 35 years ago. It's not exactly the quick fix that some doctors would let you think... but then again, it is not necessarily an evil drug, for the same reason that the D&C procedure is not always used to kill babies. Sometimes people lose their babies and are going to miscarry anyway... this drug can be used to help people in those circumstances in the same way a D&C could.

It would be nice to live in a world where abortion was outlawed once again. I'm not suggesting that we have a "too bad, so sad" attitude towards those who find themselves pregnant with an unwanted baby, I think that we should help them in any way that we could. It would be nice if more resources were diverted to pro-life crisis pregnancy centers that would help teen moms (or older moms, if needed) with resources, medical care, or even a home to stay at if their parents kick them out of the house.

I really love my babies... the one that is 5 1/2 and had her first two baby teeth removed today, and the one that likes to climb on our computer cases (and anything else he can find). It's hard to believe that they started out smaller than a poppy seed. It's hard to believe that someone would want to end the life of a baby that would eventually grow into a sweet little newborn or toddler if just fed and cared for.

I used to think that abortion was okay for some people, but not for me. But then I saw the Silent Scream video. Don't click on the link if you are a kid or are squeamish, however (there's nothing on the main page that is offensive).

Hope that we don't have another 35 years (and 35 million babies) of abortion in this country. :-(

Monday, January 21, 2008

Stock Markets Worldwide Drop - What To Do?

My husband called me up to let me know that several stock markets worldwide have been dropping today. I guess that's not really a surprise. Our markets were closed for Martin Luther King day.

Is there anything that you can do in times of economic trouble? Especially if things continue to get worse?

1) Become a miser. My husband even suggested that he wanted to do this last week. We're going to spend as little as we can. I even ordered a Pizza Hut gift card with some of my Mypoints, because I like to take dd to Pizza Hut once a month to use her Book-It coupons, and even the $5 I end up spending for me and ds is too much for me with this new spirit of miserliness.

2) Save as much as possible. That may be difficult, but if you can find ways to cut back with newfound miserliness, you might be able to save a little. Every little bit helps. If you're getting a tax refund, save it or pay off bills with it. If President Bush gives you some money, save it or pay off bills. My dh is trying to save up at least $5000 in case he loses his job... which will be a little tough because his temp-to-hire assignment ended abruptly a few minutes ago, so once again, we have no income coming in to save. But once he does get a job, we're saving it.

3) Trust God. No matter how bad things get, God is always there in control. Nothing can happen, good or bad, without him knowing. Even hard times are usually temporary. Even the Great Depression ended... eventually. If you don't know God, now might be a good to get to know him. We all have done bad things, like lying, or stealing (even taking a pencil from work is wrong), or hating someone else (Jesus said that was murder in your heart). That keeps us from God. Jesus has paid the penalty for our wrongdoings by dying on the cross... if you trust him.

4) Make yourself indispensable as an employee. Make it so that you are so important, your job won't want to let you go. Learn new job related things.

Hopefully things will turn around... but if not, be prepared for a bumpy ride ahead.

MLK and Kids

Happy Martin Luther King Day!

It's a pretty normal day around here. The baby is pinching his big sister and pulling her hair (as normal), we had school earlier today (although I made reading a little easier for her), and dh is off at work. He doesn't have school but he's going to his friends after work to build a computer, so he might as well be going to school after work.

I tried to explain Martin Luther King day to my 5 year old, but she really wasn't interested. I don't even really think she knows the difference between black people and white people... she knows that people come in lots of different colors, something that she can see in her own family, but she doesn't really know too much about race.

So how do you explain that at one time some people had to drink out of different water fountains and sit at the back of the bus?

She's just starting to get slavery. She knows that a slave is "a person that works for another person" and that they don't get paid. We've discussed that the Israelites were slaves in Egypt, and have touched on slavery in the colonies, because we're studying colonial America this year. But a 5 year old doesn't really understand much more.

I guess that it's good that we live in a world where kids don't know a thing about racism. I'm sure that time will come eventually, but it hasn't yet and in some ways that is good.

Saturday, January 19, 2008

Working Grandmas

I was just entering a contest to try to win a trip to China, and I started wondering about who would go with me. My mom would probably be interested in going, but then who would I keep the kids with? Their other grandma works. Perhaps their aunt.

But it's a darn shame that their other grandma works. She's already worked for most of her adult life, and has even retired from her career. Her husband makes her work... he wasn't happy with his management job with one company, so he went to work (from the bottom) for another company, made his way to night manager, and now he's unhappy again. Plus they listened to some really stupid financial advice and took out a mortgage when they could have paid off their house entirely.

I remember what a good time I had as a kid when my parents would go away, either for a week or a weekend, and I went to stay at Grandma's house. What kid doesn't like to stay with Grandma? Everything is different there... and grandmas always have toys around. Even my grandma still has toys in her house for her great-grandchildren when they visit.

Even my grandpa was pretty cool. He's pretty crotchety right now (I guess that's what you get when you're 82 and still work full time, although he does so out of choice), but back when I was a kid, Grandpa was really cool because he would give us sodas.

I loved going to Grandma's house. It didn't matter which grandparent, I would have a great time at both of them.

Nowadays, for many kids, staying at Grandma's house isn't the option that it used to be. A lot of grandmas work full time. Many of them will retire, I'm sure, but during their grandchildren's youngest years, when it's the most fun to go and stay with Grandma, they're working. It's a little sad.

Both of my grandmas did work... some. My Grandma W. made pies for this café in our little town. Grandma S. made (and still does, I think) wedding, bridesmaid's, and prom dresses, as well as wedding and sheet cakes. Grandma W. did actually have to go into the café to make the pies, but it only took a little time out of her morning. Grandma S. does all of her work in the home, although sometimes she goes and delivers the cakes somewhere. But being a home entrepreneur is a lot different than getting up and going to work full time somewhere, which is what a lot of grandmas are doing nowadays.

A lot of people nowadays think that they need two incomes to make it. I'm sure that in some circumstances that is the case... especially if they have a lot of debt. The working grandma is just an extension of that. Which is a little sad, because Grandma's house is great fun for little kids.

Why Does Our Government Encourage Stupidity?

My Excite News today said that our lovely president wants to give everybody tax rebates. The hope is that we'll take the $800-$1600 that they want to give us and go hit the mall.

As much as I'd really like to have a wii and some new clothes, that's the last thing I'm going to be doing with my money right now.

My husband lost his job 3 times last year. Not because he was goofing off or anything, but he just happened to get hired into jobs that didn't have their contracts removed or had to make cutbacks. With all indications of America's economic bubble bursting at some point, we don't expect things to get better soon. If we get the money, we're saving it. Maybe we'll invest it in gold or some other precious metal.

A couple of days ago, my husband suggested to me something that I never would have imagined that he'd say "let's live like misers." He loves to spend. However, he wants to be prepared in case he loses his job. So our goal is to save up $5000 in case he loses his job again.

It seems as if America has lost all touch with common sense. If you get into debt or spend money that you don't have, eventually you're going to have to pay it back. Visiting my family over Christmas really showed me the effect of being smart with money, and living within one's means, or being stupid. The people that got into debt when I was younger sure had fun then, but they're not exactly that well off any more.

Dave Ramsey is a pretty smart guy when it comes to money. He has a lot of common sense. He has a few baby steps that he suggests that people use when they are trying to work their way to financial independence:

Step 1: save up a baby emergency fund
He suggests that you save up $1000 as a baby emergency fund, in case the car breaks down, the refrigerator stops working, or something unexpected like that comes up. $1000 isn't going to help a whole lot, however, if you lose your job. We're trying to save up $5000 right now... actually we're trying to save up $6000, $5000 in case of a job loss, $1000 in case the car breaks down.

Step 2: pay off all debts except the house
We have a student loan and a car loan that we need to pay off. Oh, and some medical bills when we had to go to the ER last summer (3 times) when dh didn't have a job. So that's what we have to pay off after we save up our emergency/job loss fund. You pay interest on all of your debts, so it's a good idea to get them paid off. Once you have no debt, you have more free money every month. Yay!

Step 4: save up 3-6 months of expenses
This is where Dave suggests that you save up in case of a job loss. We're doing more of step 4 in step 1, primarily because the threat of a job loss seems a little more looming than even the refrigerator breaking down. But we'll probably add to our savings here.

I think that step 5 is pay off the house, but it could be save up for retirement or save for your kid's college funds. If I ever get to these steps I'd be all over it ;).

I don't see anywhere in here the instruction to "go out and waste money at the mall." That might postpone the inevitable downturn in the economy, but it's going to happen. You can borrow and live beyond your means forever, even if you are a government. We can try to put our head in the sand and pretend that when our economy grows enough, we will pay off the national debt, but that's just like somebody who goes out and charges up their credit cards saying to themselves "I'll pay it off when I get a raise." When that raise comes, they just want to spend more money on other things.

If we get these tax rebates, I'm saving mine. I'm going to need it whenever the bubble finally bursts. And if everybody else rushing off to the mall or going on vacation ends up prolonging the inevitable, then I guess that gives me a little bit longer to prepare.

Wednesday, January 16, 2008

The Mexicans Don't Want Their Illegals Back... Boo Hoo

Our state recently passed a law stating that companies who knowingly hire illegal immigrants will have their business licenses revoked. Despite the fact that it is currently being challenged in the courts, the law has had the effect of driving some illegal immigrants out of the state.

Now some Sonoran officials from Mexico are complaining that the new law will hurt the state because of the jobless Mexicans returning to their hometowns.

Could somebody call the Waaaaambulance?

There are several issues here. First, the people that are leaving Arizona and returning to Mexico were not supposed to be here in the first place. Secondly, the people returning are citizens of Mexico, not of the US. They belong in Mexico. Thirdly, this law passed last summer, so people have had at least six months to prepare. In addition, not all of the illegal immigrants are returning to Mexico. Some of them are going to other states; others weren't Mexican illegal immigrants, and are returning to other countries (sometimes it's easy to forget that there are illegal immigrants from countries other than Mexico, but they come from all countries).

Arizona has contributed to the education, health care, social services, and police services of illegal immigrants for far too long. I've waited in the emergency room for 4 hours before waiting to be seen by a doctor... and I can guarantee that many of the people ahead of me were not legally here. I'm sorry if Mexico feels that it can not provide for their own citizens, but what makes them think that we want to?

If the Mexican citizens returning to their own country are hard-working, then in due time they will once again be contributing to the Mexican economy. Mexico is a country with natural resources, and if it's not a place where someone can be an entrepreneur of sorts, then perhaps Mexico should take care of some of the corruption in their government, take a look at how things are run, and allow enterprising people to find ways to make their own money. Other than selling trinkets in tourist areas. Not that selling trinkets can't be an honorable way to make a living, just that there are a lot of them and there should be other options.

I realize that there will be some adjustments to be made. On the part of both Mexico and the state of Arizona. But it can not go on as it has been.

I remember watching a program in the last day or two where they were talking about how we have had recession avoided and put off for years because of low interest rates. It's just like someone who can't pay off their credit cards, so they take out a home equity loan to pay off the credit cards, then end up ringing up their credit card bills again. At some point there is a breaking point. We can't continue to give incentives for illegal immigrants to come live in our state. Our economy can't support it. Especially with the way that the economic future is looking. We either face the music now or face worse music later.

I'm not trying to be heartless, but there are always consequences to pay for your actions. If not now, later. Mexico is partially culpable in the whole illegal immigration mess. They have turned a blind eye to it for quite some time. Unfortunately, if an influx of Mexicans returning home is going to cause a problem, that is just the price that Mexico must pay for not attempting to stop, and even winking at and promoting, the exit of their citizens into our country for so long.

Highest Inflation in 17 Years

Woke up this morning to see an Excite article to see that inflation is the highest that it's been in 17 years.

Of interest to note, is that the two items that rose the highest last year were energy and food costs. Energy costs were up 17.4 percent, and food costs were up 4.1 percent. This is the highest that it's been since 1990.

The report, issued by the Labor Department, said that inflation outside energy and food costs were tame. I don't know about you, but energy and food costs just happen to be the two things in my budget that are not fixed, and there's only so far you can squeeze them.

Now I'm pretty good with the food costs, and there were several weeks last year that I got by with spending $25 for the week (out of necessity), and that included diapers, but that's primarily because I always shop for things when they are sale and I always have a surplus because I buy this way. People still have to drive to work and back though.

What does a typical person's budget look like? Not the numbers, but whether something is fixed or not. I'll give a breakdown of my budget, and I guess I may be semi-typical, other than I don't have credit cards:

Mortgage - fixed
Car payment - fixed
Student loan - fixed
Trash - fixed, but subject to increase
Sewer - variable
Water - variable
Internet - fixed, rates locked in for now
Vonage (phone) - fixed, but subject to increase
DirecTV - fixed, but subject to increase
Electricity - variable
Gas - variable
Food - variable

I may have other things but I can't think of them. The three largest items in my budget, outside of the mortgage and car payment, are variable. There's not much you can do to decrease them. And they are also the three items that went up the most in 2007.

Because I'm pretty budget conscious when it comes to groceries, I really notice when the prices go up. Surprisingly, around here, the price of ground beef has remained fairly stable, I can still get that for $2 a pound not on sale. There was even one week last year when they had beef on sale for $1 a pound and I was able to buy 20 pounds or so. Milk has gone up, however, as well as soda, processed foods like chili, bread... I even saw a higher price for frozen vegetables two weeks ago.

The question that I'm wondering is... why is the federal reserve keeping interest rates so low? Haven't they been saying for at least 10 years that inflation has not been a problem and that keeping interest rates low was promoting economic growth while keeping inflation down? Since inflation is going up, shouldn't they raise interest rates to try to curb it?

When my parents bought their home in the 1970s, they were lucky because they didn't have to pay a double digit interest rate on their mortgage. Interest rates that high are unheard of today. But maybe they should be closer than that, rather than sitting at the ridiculous lows that they've been at for nearly the past decade.

There is one downside, of course, to raising the interest rates... all those people in adjustable rate mortgages that are already crunched in their budgets. With skyrocketing home values, property taxes have gone up to keep pace with it... I know that our property taxes have gone up nearly $200 a month in the last 2 years... and we don't have an ARM. So I get that raising the interest rates will eventually cause more people to not be able to afford their homes and have to foreclose.

However, the whole point of an adjustable rate mortgage is that it is adjustable. There are usually limits on how much and how fast and ARM can adjust, but the whole point is that they do adjust. They are usually a very stupid idea, because you never know what the future can hold. Everything can seem rosy one minute, but anything can happen... especially when it comes to the economy.

If they don't raise the interest rates and inflation for the things you have to buy continues to skyrocket, everybody will suffer... including the people with ARMs. If they do raise interest rates, maybe the government can keep the dollar from freefalling and maybe we can curb inflation. Course raising interest rates will probably send the housing market into a tailspin and create a lot of foreclosures.

What a choice. Inflation and a weakening dollar, or the housing market going into a tailspin. Tough call.

Monday, January 14, 2008

What's Wrong With California? - Thermostat Control

I used to live in California, and I know a lot of great people that live there. I know an excellent church in San Diego... if you ever happen to be there on a Sunday, be sure to check out Lighthouse Baptist Church. I love Disneyland... but there is a reason that I don't live there any more.

For several years in a row (although I didn't hear anything in the last couple of years), in the fall I'd always hear about some poor homeschool teacher who was threatened with losing their kids or something because they were homeschooling. While California is a state where it is legal to homeschool (as it is in every state), for a while there, they were harassing homeschoolers left and right. They're also the state where Across The Centuries - that oh-so-lovely Islamic-friendly textbook where you get to assume a Moslem name, pray to Allah and play jihad games - is part of the standard curriculum in many schools. And let's not forget that you have to promote homosexuality in the public school curriculum now.

But the newest news from California doesn't involve any attempts to conform the populace into homosexual Moslems... this time they want to invite the 1984 lifestyle into your living room. Specifically when it comes to temperature.

Next month, the California legislature is expected to approve a measure that would force all new homes, or homes undergoing significant remodeling, to install thermostats that could be controlled via radio frequency. The whole point is to allow the power company to change the temperature of your house based on the available power. They want to be able to control how hot or cold it is in your house.

Now I like to conserve electricity more than anyone. At least in the summer. Forget a temperature of 72 degrees... in the summer I like to keep the thermostat somewhere between 84 and 87 degrees. I just hate to see high power bills, and I don't mind the heat. In the winter though, I like to keep it around 74 during the day because I get cold easily... 70 at night.

I wonder how this radio controlled frequency device would work on cold-blooded peons like me. Maybe they'll turn my thermostat up to 90 if they are running low on power... which I guess might be okay... but then when they get power back, are they going to try to turn it back down to 75 or so? Are they going to try to freeze me out of my house? Give me a much larger power bill than I want because they turn the temperature down lower than I want? Well, they won't with me because I don't live in California, but maybe I have another heat-twin in the Golden State... will they make her suffer?

I suppose in the winter they'd be less likely to take over temperature controls because the rolling blackouts usually occur in the summer when it's hot.

Despite the fact that it won't affect me - yet... there's that whole poem of "they went after the smokers, but since I wasn't a smoker... I said nothing .... then they came after me, and there was no one left to speak up." What kind of a society do we live in where Californians will stand for this? Maybe someone has a medical problem where they need it to be a certain temperature? I know that my husband has a problem with getting too cold because it can flare up his sickle cell anemia. Or if we look at it from the bigger picture... what business is it of California's if I use my money on air conditioning or if I spend it all on Haagen-Daaz? Or beer? Or if I send it all to Mexico (wait, I guess they're okay with that last one).

I wrote just a few days ago that I believe that our country is headed for difficult economic times... very difficult ones. I wonder what will happen if/when that happens. I read the other day about a kid during the depression who was made fun of because of being dirty... mom had to choose between buying a bar of soap or a dozen eggs, and she chose to buy food. What would we as a populace do if struck in a depression now? Are they going to let people that can't afford their sewer bills any more to dig an outhouse in their backyard? Will they take children away from their parents because they can't afford soap? Of course, everybody else would be in the same boat, so the government probably wouldn't want to take away the soapless children because then they'd have to pay someone to take care of them. But who knows, our government hasn't made a lot of sense lately in a lot of areas.

But back to California. Wouldn't it be a whole lot better if California made the temperature control program voluntary instead of mandating it? You could provide incentives like giving them a slight discount on their electric rates when the system was activated. Couldn't the government just ask Californians to conserve when there was a power crunch? Maybe suggest that they turn their thermostats up to 100 or something?

I realize that rolling blackouts are a problem in California during the summer... but reducing rolling blackouts by telling them what temperature they can keep their homes at is worse than the problem itself.

Saturday, January 12, 2008

A Different Sort of Post: Weirdness

Julie has asked me to write about 5 things that are weird about me. So I guess that I might, even though this is slightly out of character from what I normally write on my blog:

1) I do my grocery list with a spreadsheet that I carry to the store. I use the Grocery Game to find out what the best deals at the store are, then I enter the item name, store's price, the price that I'm paying after a coupon, the quantity of the item I'm buying, and the coupon packet that I can find the coupon in. After putting together the spreadsheet, I gather my stack of coupon booklets, which I keep sorted by date, and cut out coupons. I then take my coupons and spreadsheet and shop! BTW, my spreadsheet saved me $15 this week. I expected my grocery bill to be around $52 and they charget me $67. Even with my substitutions and tax, I suspected that something was wrong with a difference that great, and it turns out that they didn't give me the Proctor and Gamble rebate that I was supposed to give and charged me full price for the meat I bought. I brought it up to the attention of the store employees before leaving the store and got a $15 refund.

2) I'm a stay at home mom, but I'm also something of an entrepreneur. I do a lot of sweepstakes, that netted me over $760 worth of prizes in the last half of 2007, and I also am a member of a survey site that periodically sends me surveys and pay me cash for it. I also keep track of my sweeping wins (and expenses) on a spreadsheet.

3) I read nonfiction for fun. I like to read history from a Biblical worldview. Right now I'm reading Gregory of Tour's History of the Franks for the second time (read it first in college).

4) I have a college degree, and spent several years in the Navy after college. Ended up as a Lieutenant with 10 years that counted for pay... if you look at the military pay charts, it pays quite well. Well, with all that, I still chose to work in a day care for $7 an hour for 2 years. I worked there because we needed a little extra money and at the day care I could keep a better eye on my daughter. I currently am a homeschool teacher.

5) I like to learn languages, but I'm only completely fluent in English. I can get by in several other languages though. I've studied German, Russian, Spanish, Italian, and a smidgen of French, Arabic, and New Testament Greek. Oh, and I'm trying to teach my 14 month old American Sign Language (ASL). So far he's signed eat, doggy, milk, and I think ball, yes, and more to me.

There you have it. Some weird things about me. I'm not going to tag anyone else for the same reason that I never forward chain letters or chain emails.

Is Our Country Headed Toward Economic Ruin?

I wrote in my last post that my dh didn't have a job... but this article is not about our economic picture. I'm happy to say that 1 week upon arriving back from my parent's house for our unexpected Christmas break, my husband has found a temp-to-hire position working at the headquarters of a large grocery chain around here. I'm really proud of him and his skills. When I left the military 4 years ago and my husband took over as breadwinner, it took him over a month to find a job. He lost 3 jobs last year, and each time it has taken him 1 or 2 weeks to find another. Every time he has gone on an interview and blown away the competition. I guess that working hard and improving your skills pays off, eventually. And he's still going to college in the evenings (he's taking 12 units this upcoming semester... completely amazing). The pay for his new job isn't spectacular for a permanent job, but it's pretty good for a temp position... and usually you can expect to get a raise when a company hires a temp permanently.

I'm worried, however, about this country as a whole. It's something that both me and my husband have been predicting for years. Just like the housing bubble. Any logical person could have looked at skyrocketing housing prices years ago and could have told you that it couldn't last forever. When you have to have an income of $90k a year and put down well over $100k to buy a house, something has to give. Just like the dot-com bubble. Remember in the early days of the web, when companies made their money from advertisements, and those companies paying the advertising were also making money that way? I personally made a little pocket change just from putting advertisements on my computer. But it was all a big Ponzi scheme, and eventually, it had to end.

I'm so serious about this, that I called up my grandma today and asked if she would consider moving my inheritance that she currently has invested in Microsoft into gold. She said that she'd consider it. I really do not have confidence in the near-term future of the stock market... near term being the next 5 years, probably less. I believe that in the grand scheme of things... as in... 30-40 years from now, stocks are still a good investment, but I fear that we are headed for an economic downturn of 1930s proportions. I'm doing my best to prepare for it, both mentally and educationally.

Glenn Beck has been talking about the economy a lot recently, which I find interesting, but what he says really only confirms what I already believe. He recommended the book "The Forgotten Man" which I checked out from the Greater Phoenix Digital Library and started reading. It's about the great depression. I'm not sure how things will play out, but I'm trying to learn a little bit about hyperinflation as well... boy that would be fun to go through... NOT.

This article was interesting. Forget the fact that whoever wrote the article is completely out of touch with reality (who seems to think that feeling the middle class squeeze means shopping at Whole Foods and buying cases of Pelligrino)... read some of the accompanying message board postings. You probably won't want to read them all because it goes on for 123 pages at last count, but it truly enlightening. There are SO MANY stories of people who are having difficulty making ends meet, and only a few people that don't feel that way.

I guess a lot of people charged their Christmases this year. Tsk, tsk. I guess that it is okay if you are able to pay off that bill this month, but a lot of people won't be. Unfortunately, the good times on credit cards only last for so long. The income limits might rise for a while, but eventually you have to pay. Like the Bible says, there is pleasure in sin for a season. But is debt a sin? The Bible says that the borrower is slave to the lender.

Interestingly, I found this passage in the Bible as I finished reading the Bible last year (well, I actually finished it on January 1st, but who cares about one extra day):

Woe to him who increases what is not his! Until when, then, shall he load the pledges on himself?
Shall not those who strike you rise up suddenly, and those who shake you awake, and you become a prize to them?
Because you have stripped many nations, all the rest of the people shall strip you; because of men's blood, and the violence of the land, of the city, and of all who dwell in it.
Woe to him who robs evil booty for his house, to set his nest on high, to be delivered from the hand of evil!
You have planned shame to your house, to make an end of many people, and are sinning in your soul.

~ Habbakkuk 2:6b-10
Isn't that what we as a country are doing? And have been doing? The very act of buying on credit is increasing what is not ours! And we as a nation have been stripping other nations for years! Just think of all the Chinese sweatshop workers that labor away to make our clothes and toys. They don't get much out of the deal. They have a job, sure, but not in any sort of condition that we would work in.

It is rather difficult and in some cases impossible to get by without any debt in this country... we had to take out a car loan last year after our old one decided to die; neither of us knows anything about cars so we need something reliable for dh to get to work in. We do have a mortgage, although we tried to go the more modest route, and we have student loans... mine is towards the end of getting paid off, and dh's loans have saved us through some job losses. But should we really be charging Christmas gifts on credit? Or vacations? Things that are unnecessary.

If people stop buying, the economy is going to slow down. That is what we hear. But guess what? People can't spend beyond their means forever! Eventually people have to pay or they lose it.

While on vacation, I got to see many of my relatives. It is interesting to see how your relatives turn out. They're the one set of people, other than your closest friends, that you can say that you've known for decades.

I remember visiting my Aunt and Uncles, a long time ago, and they lived in a little trailer on a piece of property that didn't have electricity. They had it hooked up to a generator. Later on, they lived in a motor home for a while. They've had their share of difficulties, but guess where they live today? A very nice, gorgeous home.

Another Aunt of mine, when I was younger, I thought that they were rich. Always having huge birthday parties, redoing their homes with nice things, getting great presents for their kids. Found out later they were financing and getting home equity loans. They eventually lost their house. Currently my Aunt lives in a trailer.

My parents didn't have much money when I was growing up. We went for years without health insurance because we couldn't afford it. My grandma would always bring home clothes from the Navy Thrift Shop and my mom would make me try them on twice a year. They weren't always the latest fashions, and around 3rd grade or so I didn't really like them. My mom would save money through coupons and refunding, and that's how we funded my first trip to Disneyland in the 4th grade. It was my first time out of state. They're doing pretty well now. They paid off their home, then decided to buy a Harley for dad, remodel the kitchen, and replace the windows in the house, so they took out a small mortgage again for that. But they're doing okay. They were able to take us out to eat a couple of times, weren't worried about how much propane we used in our "guest house" while there (we stayed in their trailer), don't obsess over coupons like they used to, and don't really worry too much over the cost of things like when the VCR goes out all of a sudden. They can afford it.

Too many people nowadays live like my Aunt and overspend, rather than my other Aunt and Uncle, and my parents, who don't look like they have too much initially, but since they're not overspending, end out a lot better in the end. And that, unfortunately, is why our country may be headed for a huge wake up call.

If everybody paid their fair share of the national debt today, we'd all have to cough up over $30,000. That's for every mom, every dad, every grandpa, and every baby. It would be over $120,000 just for the people in my house. That's what my home mortgage is. But that's what we all owe, and it's getting bigger every day. I just can't see this going on forever.

Despite this, I think that we personally (as in, my immediate family consisting of me, dh, dd and ds) can make it through. Dh has a lot of skills, I've learned a lot about coupons and frugality, and we're mentally prepared to hold on in the bumpy years that may lie ahead. More importantly, I know that no matter how things get down here, there is always a better day ahead. And I've read history. I know that times get better eventually. That is, unless we're headed toward the last days spoken of in Revelation... and even they get better after Jesus comes back and begins the millennial kingdom. I also know that historically, we live lives that even kings and queens wouldn't even dream of back in the middle ages. And most people in Iraq would love to trade places with us. It's all a matter of perspective.