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Random Observations

August 26th, 2010 at 07:16 am

I've noticed strange little things about the economy.

I had been noticing very few trucks on the road, when driving long distances on the interstate. I don't know if there is less, or if they are driving faster. Or both? I just rarely seem to pass any trucks in the 70mph zone, anymore.

Of course, last night I saw plenty of trucks. Way more than I have lately. Hmmmm...

& then, at seminars, suddenly, no pens. They usually always set out pens and paper (at hotels and such). & now - no pens! Just a funny/random observation. No more budget for pens, eh?

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I saw a Tesla roadster yesterday. Sweet!

I think we saw one when we were driving back from Monterey. Know I had seen one recently - not 100% sure where. Before that, the only one I had seen was in my neighborhood. Spotted once, many years ago. Meanwhile, every time I am driving in the Bay Area I think, "You think I'd see more Teslas."

& so I saw one yesterday, right around Palo Alto/Stanford.

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Ugh. I picked a terrible time to go to the Bay Area. I usually don't encounter much traffic on my daily commute. But last week, there were 3 times that there was an accident or fire at my exit. Then there was a fire by my work. Traffic traffic traffic. & that's about how my day went yesterday. Traffic traffic traffic. The brakes got a workout. Was just unusually heavy traffic, everywhere.

I actually waited out the commute traffic and left around 7pm to drive home. So I thought. They had done a lot of work and widened one section of the freeway to about 20 lanes it felt like. & I Was just STUCK in traffic for the first 60 miles or so. I told dh that it all seemed to be commute - no accidents. & lord knows why so backed up since there seemed to be twice as many lanes as usual, at the worst of it.

As gripey as I was, I can appreciate our own region. The traffic can be pretty terrible for certain commutes, but the commute is fast. It's over and done with within a couple of hours. I Can drive anywhere at 8am or 6pm, and the cars are off the road. & here I am sitting at 8pm, in commute traffic from hell - these people who commute 60+ miles each way so they can afford a house.

Gee, I wished I lived in the middle of nowhere, so I could spend hours in my car every day? That is the life of most of our family and friends. Clearly, we don't *get* it!

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I started reading "Predictably Irrational" yesterday. It is about behavioral economics. Wow, a very interesting read!

There is no doubt some very interesting knowledge to gleam, by reading the book. I am about 50 pages in. I have 2 observations thus far.

1 - Having been raised frugally, I have an extreme leg up. If nothing else, I just haven't necessarily been "trained" in the social norms that the average person has. For example, my first car cost $1500. There was a chapter about price anchoring and how the first cost we associate with an item, tends to leave a particular imprint. I thought about that in terms of cars. If the average person spends $10k-$20k on their first vehicle, and if I spent $1500, then I expect cars to cost significantly less than the average person.

All that said, a lot of that can be erased by the fact that I expect an average home to cost about $800k. Big Grin They pointed out that people that move from High Cost areas to Low cost areas, tend to spend more. Like what they spent in the high cost area. Interestingly, both our homes that we bought cost the same. One was a small condo, and the other is just a large/luxurious house. Same price. I've always been open that prices that seem high to the locals are "dirt cheap" to us. ($300k for a house? A STEAL!) Without that price anchor we probably would have bought a much more modest home.

2 - #2 probably all leads back to #1. For some of the experiments and stuff I didn't quite get it. I just don't think like most people, I suppose. (Don't get me wrong - for a lot of things - I think like most people). But the chapter about "free" stuff was just kind of silly to me. Believe me, I am 100% sure I have acted irrationally for something free here and there. BUT, there were a lot of experiments about the difference between charging a nominal amount (say, a penny or a dollar) for something and how people wouldn't pay it. But they would take it if it were free. Amazon's free shipping was used as an example. Whereas to me, Overstock's $1.99 shipping is just a good as a policy as Amazon's free shipping. Plus, with Overstock, you don't have to spend $25 or whatever to get the $1.99 shipping. They are both BARGAINS when it comes to shipping, to me. There was also mention of people tending to hoarde free stuff that they don't want or need. Just not something I tend to do?

7 Responses to “Random Observations”

  1. Broken Arrow Says:

    I've been seeing a little bit more train activity though. It is said that, pound per pound, trains are a more economical transport than trucks (for raw materials and production goods), which appeals to large companies more.

    Anyways, I will be very interested in what you think of that book when you finish. In the meantime, have you ever seen the http://www.ted.com/index.php/talks/dan_gilbert_researches_ha...? I love TED.

  2. ann link Says:

    My Parish collect hotel soaps, shampoos,and lotions in hotel sizes for a doctor who works with the homeless.
    Hotels are going to dispensers in lieu of individual containers. More cost cutting.

  3. jewels3 Says:

    $800,000 for a house? OMG. Here you can buy a nice house for $110,000. $800,000 would buy a mansion, on lakefront property with a boat dock and who knows what else!

  4. baselle Says:

    I read that book a few months ago. Dan Ariely (sic?) often comes on Marketplace on NPR.

    Interesting on how we use money as much more than a medium of exchange. Often money is a mental placeholder for time, effort, desire, etc. I had some similar reactions, especially the "free" chapter. And what if you don't like chocolate enough to want either choice?

    A lot price anchoring works reasonably well during "gentle" inflation - 1-3%. The price anchor studies will be interesting if we actually go through Japan-style deflation.

  5. campfrugal Says:

    Didn't know if you knew he had a blog, but here it is for those readers that don't. http://danariely.com/

  6. NJDebbie Says:

    MonkeyMomma, you helped me win 11 swagbucks today. I wanted to know what a Tesla Roadster looks like so I typed the name in the swagbuck search engine and voila got me some swagbucks. It's a beautiful but so very expensive car. Thanks

  7. MonkeyMama Says:

    NJDebbie - Expensive, indeed! But they manufacture them here and lots of wealthy people, so it's always fun to glimpse one.

    campfrugal - thanks - I will check it out!

    BA - ditto - will have to watch that this weekend. I haven't seen it.

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