Moving on Up...Upstate that is

So in case you didn't know we will be moving up to the Rochester NY area. So we have been packing up, getting ready to go. We did pick up more than what we had when we moved in to our apartment. Now we just need to pack it up too.

This will make you do a double take

A little while back I was reading an economics/finance book (yeah I know I'm a nerd) and came across this quote which I found very interesting:

When business in the United States underwent a mild contraction ... the Federal Reserve created more paper reserves in the hope of forestalling any possible
bank reserve shortage. The "Fed" succeeded; ... but it nearly destroyed the economies of the world, in the process. The excess credit which the Fed pumped into the economy spilled over into the stock market-triggering a fantastic speculative boom. Belatedly, Federal Reserve officials attempted to sop up the excess reserves and finally succeeded in breaking the boom. But it was too late: ... the speculative imbalances had become so overwhelming that the attempt precipitated a sharp retrenching and a consequent demoralizing of business confidence. As a result, the American economy collapsed.

It was reportedly written by a young economist by the name of Alan Greenspan and explains that it came from an article "Gold and Economic Freedom" from The Objectivist, 1996, reprinted in Ayn Rand's Capitalism: The Unknown Ideal, New York: Penguin, 1987.

A spitball solution to the problem

So if you are up on current events you are probably aware that we are in the middle of a financial situation melting down (interesting side note - there is a good explanation about the why this happened here and here). Now the question becomes how to deal with the problem and how to prevent it from happening again.

I have a solution that I think should be considered. One of the factors that contributed to the problem is the disconnect in the system. Bad loans were originated, purchased by another party, sliced-and-diced into another product and sold ad nauseum. When the blame question is raised to pin responsibility for the action it becomes very messy. Couple this with the scale factor. The institutions involved are huge banks. These titans were considered "too big to fail" (lesson one: nothing is too big to fail) but as they are coming apart just due to their sheer size they are pulling the system down. With these two points in mind here is my solution and why I feel it will unfortunately be overlooked.

The long-term solution lies in smaller financial institutions. Small banks (or better yet credit unions) who know who they loan the money to (like the neighbor down the street), and hold their loans for the whole duration. Smaller businesses are quicker to respond to what is going on. Also realize that the United States is economically diverse. Smaller banks would be able to adapt to the specifics of the area they serve. One things that is nice is that if we had smaller institutions the risk would be spread out. If this disaster were to have occurred it might wipe out a few banks but it wouldn't threaten the whole system. Smaller banks would fix the disconnect and the scale issues.

I think this would be a better solution then the current consolidation and global actions. Central Banks around the world are coordinating their efforts. Globalizing the banking system is the path that policy makers are tending towards. I think they are convinced if they get bigger they will eventually become too big to fail. I just don't think they are considering the small option.

What I did tonight that I haven't done in a long time that I should do more often

Today was one of those days:
- A five min Rx pick up turned into a 50 min wait chasing the kids around
- Nap time turned into: How much trouble can Caleb get into? (He poured a whole bottle of baby oil on the rug in the boys room, woke Mason from his nap, and refused to sleep)
- I locked myself out of the house
- Mason wanted me to hold him all day (Even during my exercise)
- Because of no nap for Caleb and little nap for Mason the boys were very winy today
- The house is a mess and I did not clean one thing up
- No laundry got done
- I did not pack anything

So my day ended with a bubble bath, my favorite candle (Yankee Macintosh apple), a cake in a mug, and a relaxing movie. I should take more evenings off!

For those of you who want to make yourself a cake in a mug, here is the recipe (12 points if you want to know)
MINUTE CHOCOLATE MUG CAKE
1 Mug
4 tablespoons flour(that's plain flour, not self-rising)
4 tablespoons sugar
2 tablespoons baking cocoa
1 egg
3 tablespoons milk
3 tablespoons oil
3 tablespoons chocolate chips (optional)
Small splash of vanilla
Add dry ingredients to mug, and mix well. Add the egg and mix thoroughly.
Pour in the milk and oil and mix well.
Add the chocolate chips (if using) and vanilla, and mix again.
Put your mug in the microwave and cook for 3 minutes at 1000 watts. The cake
will rise over the top of the mug, but don't be alarmed!
Allow to cool a little, and tip out onto a plate if desired.

Why I Want to be Rich

When Danielle and I were married we lived in the University's married student housing. I remember one Friday we decided to splurge a little for date night and go down to Hire's Big H to have dinner. We didn't have much money at the time so we decided to get a pizza and split it.

We had a great dinner holding each other's hands while waiting for the food. Talking about our big dreams and what ever else we wanted to. We had our pizza and I was getting ready to pay the check. Then this guy in the restaurant that we had never met before nor after came to our table and insisted that he pick up our bill. After futile protest on our part and with much gratitude we accepted his offer. He just said promise that you do this for someone else.

I am currently reading "The Total Money Makeover" by Dave Ramsey (and I highly recommend it to anyone). In one of his final chapters he shared similar stories. One story was of a man who handed out $100 bills to strangers during Christmas time. I would love to do this! This is why I want to be rich (and hope the government doesn't "help" me take care of "others").