Having more no longer satisfies us, perhaps we’ve reached ‘peak stuff’

If having more no longer satisfies us, perhaps we’ve reached ‘peak stuff’

Sunday 31 January 2016 

Societies must learn to use economics to help provide purpose and fulfilment

stuff imageReal men don’t eat quiche. Real economists don’t ask questions about happiness. The economy pumps out goods and services, all of which create jobs and incomes. There is no value judgment in such a statement, no view of what constitutes the good life. Even to invite such a question of an economist is to risk ridicule. The task of economists – a value-free quasi-science – is to make sure that as little as possible gets in the way of turning inputs into more outputs.

But around the developed world consumers seem to be losing their appetite for more. Even goods for which there once seemed insatiable demand seem to be losing their lustre.

Last week, mighty Apple reported that in the last three months of 2015 global sales of the iPhone stagnated, while sales of iPads tumbled from 21m units in 2014 to 16m in the same three months of 2015. In the more prosaic parts of the economy – from cars to home furnishings – there are other warnings that demand is saturated.  [Read more]

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Comments

  • De castro  On February 2, 2016 at 3:58 am

    Interesting synopsis of where we are
    heading as ‘consumers’….
    The want factor
    V
    The need factor

    Cavemen and cave women
    ‘survived’ as hunter gatherers
    ‘Only just’…
    Domesticating animals and
    farming replaced that age.
    In came mechanised and intensive
    farming requiring minimum labour/time
    Today we have ‘consumer led’ economies….the want factor.

    Now without the ‘disposable’ income
    to feed that it’s a ‘higher’ minimum
    wage being suggested/demanded.
    Some go further suggesting a
    ‘liveable’ wage !

    A word comes to mind
    Theory of ‘relativity’…
    And another ‘communism’
    Each producing according to his
    ‘means’ receiving according to his
    needs.
    Unfortunately ‘means and needs’
    are variables….governed by ‘market
    forces’ … supply / demand.

    Am beginning to read like an economist
    but am not.
    However there are solutions to our
    dilemma….it’s the political cl-asses
    we elect that must find them.
    If they don’t just vote them out !

    Q.E.D

  • Albert  On February 2, 2016 at 11:51 am

    Did we not just have a post that dealth with over consumption and waste……..capitalism condition us to over consume. American housewives have 20 pairs of shoes they claim, and multiple of dresses yet they think they dont have enough . Computers and electronic gadgets become obsolete within 3 years, a new model car every year……..and marketing personnel in our face to buy more. I think our problem is the opposite to what the writer wrote.

  • Rosaliene Bacchus  On February 2, 2016 at 1:07 pm

    Perhaps we’re finally realizing the true cost of all our stuff.

  • Clyde Duncan  On February 3, 2016 at 11:07 pm

    If you have been paying attention, you may have noticed that the global financial markets are currently in meltdown mode. Apparently, the world has hit diminishing returns on making stuff. There is simply too much of everything, be it oil wells, container ships, skyscrapers, cars or houses. Because of this, the world has also hit diminishing returns on borrowing money to build and sell more stuff, because the stuff we build doesn’t sell. And because it doesn’t sell, the price of stuff that’s already been made keeps going down, lowering its value as loan collateral and making the problem worse.

    One solution that’s been proposed is to convert from a products economy to a services economy. For instance, instead of making widgets, everybody gives each other backrubs. This works great in theory. The backrub industry doesn’t generate an ever-expanding inventory of backrubs that then have to be unloaded. But there are some problems with this plan. The first problem is that too few people have enough money saved up to spend on backrubs, so they would have to get the backrubs on credit. Another problem is that, unlike a widget, a backrub is not a productive asset, and doesn’t help you pay off the money you had to borrow to pay for the backrub. Lastly, a backrub, once you have received it, isn’t worth very much. You can’t auction it off, and you can’t use it as collateral for a loan.

    These are big problems, and one proposed solution is to create good, well-paying jobs that put money in people’s pockets—money that they can then spent on backrubs. This is best done by investing in productivity improvements: send people to school, invest in high tech and so on. It’s an intuitively obvious idea: productive workers are easier to employ than unproductive workers, because the stuff they make ends up cheaper and people can afford to buy more of it. Whether they do buy more of it is debatable, especially if there is more than enough of it already and nobody has any extra money saved. Still, the theory makes sense.

    But this theory doesn’t seem to be working all that well: no matter how much money we put into automation—robotic assembly lines, internet-based virtualization, what have you—the number of unemployed workers isn’t going down at all. And it’s even worse with driverless cars. In theory, they are great: if the driver doesn’t have to do the driving, then she can spend the time giving her passengers backrubs. But no matter how much money we throw at driverless cars, the number of unemployed drivers, or unemployed massage therapists, isn’t going down. –Club Orlov Blog

  • Albert  On February 4, 2016 at 12:29 pm

    Economists and businessmen seem to have other views.
    – China is melting down and the Chinese dont seem to know how to stop it. Hence less buying from abroad and a slow down of the global economy
    – In the short run at least the report is about Job growth in the US, and no report of a slow dowh in sales. A bit puzzling.
    -There is a structural ecnomic change in the US . More to do with production by technology and less by humans…..Means many will lose their jobs.

  • Gigi  On February 4, 2016 at 4:38 pm

    Bush’s famous words to the American people when 911 occurred was to “go out and shop.” The American people did the opposite. The govt sent out rebate checks to most people but it turned out most people chose to save the money instead of spend it. Then along came zero interest rates and zero money down being offered on most big ticket items. I was in the market for a new vehicle because the lease was up on mine, and I was ready to own something I wanted to hold on to for a long time since the kids were at the age to take on long road trips. New vehicles lose 11% of its value in the first minute of being driven off the dealership lot. It loses half of its value within the first five years. I suppose it’s one of the reasons most people choose to lease.

    Because of the situation mentioned above, I was able to purchase a white high-top conversion van for $12,000 less than its advertised sale price. First off, the dealership was overstocked with these vehicles, and second the vehicle that I fell in love with was around $50,000. It had a custom paint job – a nice sea blue color – and lots more bells and whistles. I was able to use my “love vehicle” to negotiate a favorable deal on the run of the mill “I can do without vehicle.” I distinctly remember the sales guy saying to me that “you’re paying $15,000 more for just fluff.” My reply sealed the deal. I said to him “yes, but it’s nice fluff and I like it, and I don’t mind paying $100. more a month to have it.” Fast forward 10 years later when I was moving to NY and wanted to sell my vehicle. All I was able to get for my $29,000 well-kept high-top conversion in very good condition was $3,000. I sold it one week before moving. I had advertised it for almost a month ($5,000 less than the blue book value of $7,000) on several sites and also on my vehicle but got to takers. It was during the moving/garage sale I held that someone poked around in it and decided to offer me $3,000. I had already decided at that point to donate it to a charity if I couldn’t sell it, so $3,000 was better than nothing.

    The point I’m making ties into this article, new cars sales have tanked (the dealerships and auto makers are headed to court again over being forced to overstock their inventory), homes sales have tanked, luxury home prices have crashed spectacularly, big ticket homes items have also tanked. Holidays sales were dismal. Hillary’s buddy Walmart is closing 269 stores this year (so much for the increase in minimum wage), Macy’s, JCP and others are also closing several stores. And employment/unemployment numbers are always fudged to paint a false picture. The low oil prices hasn’t helped any in the sense that people did not use the extra savings to buy more stuff, but to pay cash instead of paying on credit when purchasing the basics, and perhaps to buy more drugs/heroin. There is a drug/heroin epidemic devastating middle class neighborhoods. It’ll be interesting to see how govt responds to stem this hemorrhaging of its tax base.

    • De castro  On February 5, 2016 at 7:24 am

      Gigi
      After reading that decided against
      suicide …. seriously will the political
      cl-asses change policy.
      USA will not change overnight
      from capitalism to socialism
      but hopefully capitalism with a
      conscience…caring capitalism.
      If there is such a thing.
      The greed culture has been the
      driving force in American expansionism….remove that and
      what remains ! Stagnation !
      USA is haemoraging slowly
      it’s dreams now a nightmare.
      Let’s wait and see who is new CIC.
      The American middle class must
      be very concerned as their numbers
      dwindle but the alternative is higher
      taxes…with that in mind let’s see how
      they vote.
      Not long to go !🇺🇸

    • Albert  On February 5, 2016 at 11:04 am

      Gigi sound like a Republican politician further misinforming the uninformed in that last section.
      – The FED increased (or will increase) interest rate because they feel the economy is improving and need to slow down.d
      – Did Ford not have record sales figure in 2015…..including Europe.
      – Did we not have a large increase in private job growth last month…..in spite of China downturn.
      The US is surprisingly doing well whilst most of the world is declining economically. ……….that is why Republicn politicians are finding little to criticise Obama………eexcept creative falsehood.

  • Albert  On February 5, 2016 at 10:31 am

    “The greed culture has been the
    driving force in American expansionism….remove that and
    what remains ! Stagnation”

    Funny! That’s e xactly how I see England. Capitalist England produces nothing and stagnation has taken over.
    Dont knock greed. There is a good side to it. If memory hold India, once a British colony, now has more millionaires than England. Greed can make you wealthy.

    • De caatro  On February 5, 2016 at 11:06 am

      Sorry Albert
      Greed does not make you wealthy.
      It make make a few wealthy but the
      ‘trickle down’ thesis is but a fools
      Dream.
      Rich gets richer at expense of poorer
      classes….1% V 99%
      Where 1% controls 99% of the wealth
      taxation is the WMD (weapon of mass distribution) of wealth.
      There must be a better/fairer way of
      sharing the wealth of any nation state
      than creating mighty corporations that
      avoid/evade taxes to accumulate
      wealth. Google pay 2.5% taxes on its
      U.K. Turnover of billions yet individuals
      and companies more like 25% ..,
      How can that be fair.
      As for India it is one of the most
      class full societies on the planet
      …99% who born in the ‘coolie’
      class die in that class.
      Adopted same principles as
      Victorian class structure…
      Upper lower classes.
      No so called ‘middle class’

      U.K. and EU has a very structured
      system where more than 65% of
      working class are ‘middle class’
      UK s home ownership is 65%
      renting 35%
      EU it’s the reverse …only 35% own
      their homes.
      Both systems needs adjustment…
      50/50 a better balance.
      Market forces will hopefully
      bring equilibrium.
      EU is still the largest single market
      for goods services and peoples.
      Google for more info.
      Ways I see it…
      65%

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