Wow, cooking at home!! Times are really tough.

It’s going to be in the mid 90’s today in SoCal. The birds are tweeting, the girls are in bikinis, and that sound you hear in the background is the last, dying gasps of the aspirational generation. You know, the one where *everyone* could be rich (flipping real estate), desirable (botox, breast augmentation, beemers), brilliant (see rich), and cool (boardshorts and sunglasses).

Clutching desperately to the totems of their aspirations - pergraniteel kitchens, 40″ flatscreens, D&G handbags, Hurley boardshorts, hulking SUV’s - we watch our neighbors traipse lemming-like towards the cliff, trying vainly to divert their attention from the distracting baubles they’ve equated with “wealth”.

To no avail.

My grandmom always recycled paper towels and aluminum foil on the dish rack until they were too thrashed to save. It had nothing to do with being poor - it had everything to do with utility. Why waste the money on replacing a still-useful product?

Until and unless we are rid of the aspirational social stigma of living simply, the current recession and coming depression will be long and drawn out. Perhaps, one day, we’ll be lucky enough to aspire to a different social code than merely accumulating trinkets.

Get use to living closer to where you work, because the days of long commutes by car are gone. Citys better be investing in transit, that is the future along with development at transit stations with retail, commercial & residential uses. Dallas, Denver, Salt Lake CITY & Portland OR are doing this, they’ll be ahead of the pack.

So Ed McMahan is a speculator? Jose Conseco a speculator? That piece of crap California congresswoman a speculator? They are walking away, as will many others that purchased homes over the last 4-10 years.

Keep in mind that: Many took out HELOCs, or originally purchased with very low down payments. Either way, many that purchased over the last 4 years are already underwater, and it will only get worse.
Add to this job losses, especially many high paying Real Estate industry job losses, many/most of which will never show up on the unemployment figures. Why? Because they were not employees of their firms, but instead self-employed, not paying unemployment. They are called “1099″ employees. Almost every Realitor/Mortgage broker, appraiser, that isn’t selling near as much, nor has savings, and is overextended on their primary residence falls under this catagory.
As the Dr. mentioned above, why would the holder of the Second mortgage (the sham that allowed many to purchase homes with 0% to 5% down) “Take one for the team?”
Bottom line is that when the house up the street sells for $350k, and you own $550k, and a spouse loses her job, or medical issues, or ? Also imagine that the mortgage payments (1st and 2nd) may equal $3400, while renting the same home next door only costs $2000 or less? What will keep this person in the home? ESPECIALLY when there are not debtor’s prisons anymore. So what if your credit is shot for 7 years!!!! BFD

All of this is unfolding just like the Dr. has predicted over the last two years.

Reread the Dr’s article entitled “Moonwalking away” about this very topic of walking away from a mortgage. It is so easy to do. See the website “Just walk away”. This is only the beginning………………….

How does sinking HUGE upfront fixed costs into a project that will not yield meaningful productivity for at least a decade lower your price at the pump? According to the best-case scenario for ANWR (I know, that’s not offshore…), production would not peak until 2028, and then at a pace of only 1.44 million bbl/day (or a third of that in the worst-case). Drop, meet bucket. In the mean time, someone has to pay for the obvious costs–exploration, rigs, high wages (offshore workers get astronomical premiums for taking astronomical risks)–not to mention the costs of externalities. Say a rig or two is destroyed in the first Pacific Hurricane ever to hit the south coast of California–who pays? (Hint–it will happen at a pump near you).

Instead, we should cop to the notion that cheap oil is dead, and get on with using the substitutes. Demand turns out to be lots more elastic than our wise old oil companies predicted, and lots of other costs might go down as well. I’m betting on deflation in the US in the next decade, and hard, hard times for large sectors of the population in the adjustment. Those sectors? Net debtors. Put another way, nearly everyone.

“Do more with less.” will become the new marketing mantra, and we will begin to normalize our consumption to world levels. That will be pretty damned uncomfortable for most, but I can’t see how else we’ll continue to survive.