Saturday, February 28, 2009

Mea Culpa

I do not want to be a hypocrite. I am going to confess to you my non-environmental actions that I have done. Therefore, you can judge me completely when you review my postings on this blog:

1. I do purchase Starbucks coffee on a regular basis;
2. I use disposable diapers for my son;
3. I drive to work and do not take public transportation;
4. I have a plasma TV that uses up a lot of electricity;
5. I have used regular toxic cleaners to clean my house;
6. I have gotten in my car to drive to the store, which is down the road, as opposed to walking to it;
7. I had used non-environmental friendly weedkiller and fertilizer on my lawn;
8. I do not always buy produce locally, especially during the winter, because I live in Northeastern part of the US;
9. I have taken long showers;
10. Many times I have used paper towels to dry my hands instead of a hand towel; and
11. I have stood by for a very long time without taking any action to fight climate change.

Forgive me. I hope the following actions are the right steps toward green salvation:

1. I have started to use non-toxic organic cleaners to clean my house;
2. I recycle everything I can, which my township recycles not only paper, aluminum, and glass ,but also plastics #1 to #7;
3. I have a compost bin where I dump my kitchen scraps and I fertilize my lawn with organic fertilizer and mostly organic weedkiller;
4. I joined the farm to city program where I buy local produce even in the winter;
5. I have reduced consuming meat and have at least one vegetarian meal a week;
6. I have become more aware of the packaging of the products I buy;
7. I bring my own bag when shopping and when I do not have a bag, I try not to use one of the store's plastic bags to carry my purchases;
8. I try to walk more to the shops and try to purchase locally;
9. I replaced all light fixtures with compact fluorescent light bulbs and I unplug my plasma TV every night to drive a stake through those energy vampires; and
10. At least once a month, I write a letter to the editors of my local papers voicing my concerns about global warming and the need to pass legislation to stop it.

I know this is not enough, but at least it is a start. I will continue to modify my ways to be less of a hypocrite and more of an environmentalist. Also, I will continue to work on that caffeine addiction.

Sunday, February 22, 2009

Is it really time to consume again?

Most of us will see an increase in our pay check by about $65 per month because of the recent stimulus package that was passed in Congress. What are we suppose to do with that money? Buy stuff. Get the American economy rolling again. In fact, 2/3 of the economy is driving by the consumer. We were told to consume after 9/11 and we kept the economy afloat during six of the last eight years because of consumer spending. That has left many with a huge amount of debt and a bunch of stuff that fills our closets, garages and storage facilities. Yet, again we are asked to jump start the economy by going out to the malls to buy more stuff. Something seems wrong here. Before you dust off your credit card and replace your computer with a new Mac, I recommend that you watch the "Story of Stuff" at This will enlighten you about how our consumer mentality is causing havoc to the world. We are on this vicious cycle of buying things and then throwing them away six months later to buy more things. This creates more land fills and uses of more of the planet's resources. In fact, I live in a state that is the largest importer of trash in all of the United States. I really enjoy that smell when I get those western winds coming across the state. It is projected that by 2050 we will run out of room in our current land fills to dump our trash in the US. We will need to export this trash, which is already happening now. We send a lot of our trash to China.

Ironically, this global recession has benefited the environment because we are consuming less, which equates to less trash and a reduction of the use of resources. This is the reason gasoline prices have dropped. We are producing less because there is a drop in demand by the consumer. In fact, it costs, $0.00, excluding fuel and handling, if you want to ship a container of goods from southern China to Europe. In the summer 0f 2007, it would cost you $1,400. According to the Economist magazine, 1/2 of China's 9,000 or so toy exporters have gone bust, shipments of Taiwan's notebook computers have decreased by 1/3 in the month of January and the number of cars assembled in America is 60% below January 2008 number. Now, part of the solution to get us out of this recession is to by more stuff. Do we really need it?

A book called Your Money or Your Life talks about how to get control of your finances. It focuses on energy levels (happiness and work). It has a graph that charts a person's level of happiness vs his or her level of income. In the graph, it logically shows that as we make more money, we become happier; however, it plateaus at a certain level and begins to drop. The result is after the apex of this happiness curve, your level of happiness decreases as you make more money. You are spending more money to live a certain life style, which requires more time to work and less time for enjoyment. The book focuses on people simplifying their lives to achieve happiness, which includes consuming less.

The point is that if we consume less rather than more, our lives will be better. We will not need as much money to meet our basic needs. This will require us to work less and give us flexibility in choosing what we really want to do in life. We can spend more time with family and friends. More importantly, it will help our environment. If we do not consume as much, we do not use as many resources and we have less garbage to put into our landfills. This is good for all of us.

We need to reevaluate our economy and our own finances. I am not asking us to become communists here. I am for capitalism. I work in the financial industry, which is the championing of capitalism. Nevertheless, now is the time to put everything on the table and determine if this model of consumerism makes sense for each of us individual and the environment we live in. Is it really sustainable? There is a breaking point where our resources will not be able to sustain our level on consumption. I would rather address the issue now before we reach that point. If we do it now, we have some time and flexibility to put in place an effective solution rather than some type of ad hoc solution like we are doing now with this global crisis.

Friday, February 20, 2009


Having career batting average of .310 may get you into the Baseball Hall of Fame. $10,633,206,380,182.84 was our national debt on January 27, 2009. A cholesterol level less than 200 is ideal to decrease your risk of heart disease. 380 parts per million (ppm) is the current level of carbon dioxide in our atmosphere. Unfortunately, an ideal level is 350 ppm or less. If this level remains the same or increases, we will be unable to stop or reverse global warming. At 450 ppm, we will have catastrophic changes in our climate. Fortunately, like high cholesterol, if you catch it early enough, you can prevent the condition from worsening and you may be able to reverse it. Hopefully, we can catch it early enough by reducing this number below 350 ppm. We can start at home by recycling, driving less and buying locally and, in Washington, by demanding Congress to pass a comprehensive bill to stop global warming. Alternatively, we can do nothing because it is just a number. What is the worse that can happen? 1.877 billion children who live on this planet would rather not find out.

Thursday, February 12, 2009

Tough Love: Hard Decisions Need to be made Now!

I continue to hear how eerily similar our financial crisis is to Japan's in the 1990s. Unlike Japan, we want to avoid ten years of stagnant growth that followed. The way to avoid repeating the same missteps of the Japanese government is to invoke tough love on the banks. We have to let banks go under that are not financially able to operate without government subsidies. Everyone argues that this will put us into a deeper recession. Unfortunately, if we do not do this, we may be facing 10 years of slow growth with a huge bill to payoff in the future. Some times we have to make hard decisions that will cause short term pain. We have developed as a nation a mind set of delaying negative outcomes; however, this behavior only postpones and sometimes worsens the inevitable negative result.

This same mind set has been applied to fighting global warming. We continue to: (i) ignore the science; (ii) make arguments that if we take certain action now, it will negatively impact our economic growth; or (iii) search for that magic bullet that will solve all of our environmental woes without changing our life style, which seems similar to someone who is trying to diet by taking a weight loss drug while continuing to eat the same amount of food that made him or her overweight in the first place. We are unwilling to limit our voracious appetite to consume and reevaluate our lifestyle. Unfortunately, like the future of our economy, we are creating a future with significant negative destructive consequences. Continuing this course will result in reduction of the global GDP by 5% to 20% in the future. More importantly, this will impact how we live in the future with less land and more chaotic weather.

Similar to the banks, we need have some tough love here on our consumer habits and our lifestyles. We need to make some tough decisions that might impact our daily lives, such as driving less, consuming products that are in season, and reducing what we purchase. One could argue that we will negatively impact our current economic growth if we do all of this; however, if we do not do it, we will negatively impact our economic growth in the future more significantly. In the end, by invoking this tough love and changing our habits, this will benefit us and the economy in the future. As a parent, I do not like using tough love; however, in the end, sometimes that is what is needed to ensure my kids grow healthy and lead a balanced life. The President of the United States, as a parent, should invoke this tough love of this nation to make certain we and the environment have a healthy and balanced future.

Tuesday, February 10, 2009

How much can we really borrow?

I was listening to a podcast on NPR's Planet Money. They were discussing the debt to GDP ratio. Currently, the US is at 41%; however, after this additional round of government capital infusion into the economy, this ratio could shoot up to 90%. That is within the debt stratosphere of countries like Greece and Italy. There are a lot of things about Greece and Italy that I wish America would incorporate; however, having the same debt ratio is not one of them.

What does this mean to the US? It will become more costly for us to borrow from countries and other investors. It is true that we had higher levels in the past. In fact, after the World War II, the US was at a debt to GDP ratio between 120% and 140%; however, most of the borrowed money came from within the US, not outside. The concern is that the more we borrow, the more we are dependent on other countries and foreign investors loaning us the money. For America's economy and general security, this is not be a good situation.

During the same day I heard this podcast, I attended a Green Jobs Forum. My Congressman was talking about all of this investment in the green economy. He stated that the money for this investment would come from foreign investors because everyone wants to invest in the US government because it is the safest place for investment. This might change as we continue to spend and borrow, which will push the country's debt closure to 100% of its GDP. As result, we will become a more risky investment and, therefore, we will have to make government securities more attractive for investment by offering a higher rate of return, which will cost America more money to borrow money. This is similar to a bank charging a higher interest rate to a person that has a lot of debt. The US government will have to make tough choices on where to spend this borrowed money as this spigot of cash slows down to a drip and its "water" bill increases. In addition, the US government will need to reevaluate if it should be so dependent of foreign investors.

Unfortunately, as the US government becomes more fiscally prudent and more conscious of who is investing in this country, the victim here may be the investment in green technology because it would not be viewed as an immediate need for the country. This would be a mistake. We cannot lose our focus on the future rate of return for investing in green technology now. The key is that we need to be smart about our investment and spending in this area. Investing in green technology will not only benefit are economic future but also the future of our environment. Unlike my current investments, that would be a very good rate of return.