Anecedotally, I’ve seen many people I know who have either been furloughed or had others at their place of work furloughed.   I didn’t see this duing the last recession (2001), and don’t necessarily think it’s a such a bad thing.    On a human level, coworkers are often quite selfless.  They rather have their own wages cut rather than see friends layed off.   The other advantage of furloughs is that because people are keot on the payroll when good times come again, it’s much easier to pick up work.  I’m a fan of the flexible job market.  I think a well functioning society is dependent on both workers willing to move and change their work, and employers being able to change the parameters of work when circumstances force it.  As in baseball, long term employee contracts are an albatross around the neck - just as GM and Chrysler found with it’s legacy retiree benefits.

While I believe in the flexibile labor market, and encourages others to believe in one as well, American society as whole is not particularly well prepared for it.  We are a society of grasshoppers rather than ants.  We do not prepare for the winter, and most of us have not prepared for this winter.  Ideally we would have saved up the long days of summer for the coming winter.  If that were so then workers would be better able to deal temporarily reduced hours and pay.

While I have trailed the indexes in this recent upswing, I’ve managed to stay ahead of them ever so slightly for the year.  I didn’t swoon as bad earlier in the year.

There is continuing debate on how much the Government should’ve been involved if at all with the bailing out the automakers.   Would it have been better that both Chrysler and GM collapsed on their own six months ago?  It’s always impossible to say.  Personally, I prefer an ordered transition to abrupt change as the economic impact is likely more favorable in an ordered transition. 

I’m not, however, particularly estatic at the notion of the Government owning 60% of GM after bankruptcy for any great length of time.   I’ve been supportive of bailouts (bank and auto) because I believe that Government has a role to ensure a smooth economic recovery.  I’m less supportive of the auto bailout both because a single manufacturing industry (even one as large as the Auto industry) has a smaller impact on the econmic system than widespread bank failures.  

The Government has entered a tricky position in having takenownership responsbility of what were private companies.  Only a quick return to private ownership can be ruled a success.  The worst possible outcome would be one such as Amtrak in which the Government effectively nationalized the passenger rail system.  That is not what I or anybody else should want.   I hope for the best and fear for the worst.

I’m willing to take a personal hit if I think the new legislation will truly help most Americans.   Sadly, I don’t think it will.   The new regulation will help some, but not enough.   The true costs of credit card debt will become more transparent and that is good.  Some of the worst practices such as puting payments towards the lowest interest rate balance should be eliminated.   However, the legislation fails to address the other side of the problem - credit hungry consumers.   Yes, the credit card companies need to be reigned in.   I believe in many of the provisions of the legislation, but we should also be issuing a firm rebuke to credit consumers.   Consumers are in trouble not just because credit card companies have taken advantage of them, they are in trouble because they have shirked tomorrow’s responsibilities for pleasures today.

I can’t but feel that we’re taking a mule ride up a rather unsteady path in the dark of night, not knowing if the next step is off a cliff.   There is legitmate good news on the economic front.  We are not facing another great depression, it seems as we have learned some economic lessons from the last.  The economy is only contracting at lesser rate than it was a few months ago.  The Economy is not healed, it’s just not losing as much as blood.  I think this should be obivious when you have less people employed, it’s hard to lay off as many people.

The stock market has responded to the less dire news with glee and joy.  We’re nowhere near the highs from early last year, but we’re far above the lows of mid March.   Who knows if we rally further from here or test new lows?   I certaintly don’t.   Still, my gut feeling is that we’ll pullback as investors realize while things are not as bad as they may have looked, they’re still not good.   That’s a good thing.   I wish the economy the best, but I also want economy to recover slowly via increased savings, and healthy investment in business.  I don’t want another bubble, sustained by excess consumer spending and uncontained speculation.

• Megabus: ~$30 Roundtrip*
• Bolt Bus: ~$40 Roundtrip*
• Chinatown Bus: $30 Roundtrip
• Standard Greyhoud Bus: $69 Roundtrip (Non-Refundable)
• Limoliner: $178 Roundtrip
• eFare Greyhound Bus: $38 Roundtrip
• Airline Shuttle: $165-$244 Roundtrip
• Amtrak: $144-$278, $278 is for the Acela
• Driving: $40 in Gas, and potentially anohter $40 for parking (though I usually manage to find street parking)

* Megabus and BoltBus have variable pricing for seats.  There’s are limited seats that can even be had for $1 if booked far enough in advance.

The bus routes in the northeast corridor have happily become more competitive.  Megabus and BoltBus both offer free wifi, and BoltBus offers power outlets as well (not in every seat, but enough).  The other advantage for both Megabus and Bolt over the chinatown buses is that seats are guaranteed.

BoltBus is actually owned by greyhound and peter pan and is basically their low cost carrier, kind of like the now defunct TED (United) and Song (Delta) airlines that were operating a few years back.   Megabus is subsidary of Coach USA.  While I have yet to take Megabus, I found the Boltbus lived up to advertisements.  I had more leg room than I typically have on a bus.  The wifi worked well.  I didn’t grab a seat with a powerplug as I’ve found that traveling with my iPhone to be enough.

I think one thing to keep in mind with all the discount bus carriers is that one need to plan their trip smartly.   The bus that is leaving is usually a bus that may have just arrived.  As a result, there are days when buses can be hours late because of traffic.  I would never for instance take the bus at 6pm on the Wednesday before thanksgiving.   I think taking the bus requires a certain willingness to be flexible.   I remeber a few years ago, I was taking the chinatown bus t New York.  I arrived a little late and had no seat.  I asked the woman if there were seats on the next bus, and she said yes.  As a result I decided to head out for a snack.  I came back with 15 minutes to spare, but the next bus was already full and a line had already formed for the next bus.   At that point, I demanded a refund and headed to train station and got myself an Amtrak ticket.

Many people will have a bus travel horror story to share when prompted.  Everyone has them.  Just as everyone has a airline horror story.  The train does seem to fare better than other modes of transportation - I can’t say I’ve ever had a bad train experience.   At the end of the day though, the bus is just leagues cheaper than either the train or the flying.  I found my ride on the BoltBus pretty good.

Let’s set aside the issue if the Government should be involved at all.   The Government’s involvement is a big issue, and one that should be debated, but not critical in evaluating how lenders should be behaving.  Assume that role of the Government in this case were instead being played by that of a private investor who already owns a large stake in Chrysler.

Chrysler had hoped to avoid bankruptcy by negotiating with its lenders and union workers.  The investor was willing to put more money into Chrysler if lenders were willing to take a haircut on the money they were owed.   Most lenders and the unions agreed to these concessions.  A few held out.

On the most part, I don’t have a problem with the “Non-TARP” lenders holding out.  That’s perogative, they should decide what’s the best decision financial decision for them.   Maybe they can get more out of the Government by holding out?  Maybe they will get more via a bankruptcy proceeding.  There is one case in which the actions of these lenders may be morally questionable.  If they hold credit default swaps that insures their debt and would actually make them better off if the company were to go bankrupt.  That situation would be akin to me lending a large sum of money to a friend and then taking out a life insurance policy on that friend.   So far so good, but then let’s say that my friend is critically ill and needs a life saving blood transfusion from me.   My friend might get better but if he dies I’m definitely better off financially.

What I object to is the notion that the current actions on the part of the Government in demanding concessions somehow “breaks the rule of law” as some voices of the other end (of the White House) political spectrum have screamed.   Renogitiating when circumstances change is part of a well functioning society, and well within the idea of the “rule of law.” Chrysler is not asking for a renogitation just because it wants to, but because it has to. That’s good business. Those who believe that the “rule of law” is sacrament must believe the only option for dead beat debtors is prison. Even if we still had debtor’s prison, how do you put corporation in prison?

Two weeks later, all that violence is long forgotten.  Now, Mexico is at the epicenter of the swine flu pandemic (or atleast media pandemic).   And to think I thought I got a great deal two weeks ago?   Today I can pay $1800 for the same trip (all inclusive for two) that cost me $2600 two weeks ago.   Given the huge price difference, I decided it was in my best interest to cancel my trip.  

I’m not particularly concerned about the swine flu, but my girlfriend is.   I had also heard the airlines were waiving cancellation fees.  I called Expedia, and canceled as much as I could.  I was able to cancel my hotel reservation worth $2000.   I didn’t cancel my airline reservation as I learned that Delta had only waived fees for flights in the next 5 days.  I was not planning to travel for another month.   Canceling my Hotel early was the right thing to do as I could incur a cancellation charge the more I waited.  Given that the airline had not decided to waive cancellation fees for flights in June, I had no reason to cancel my flight now.   I have a free option to wait and see if Delta decides to extend the waivers.

Even if I were to absorb the complete cost of my flights, I could still book the same trip right now and save $200.   The more probable outcome is that I don’t get a waiver on the change flight fee, and end up with a $600 credit - $300 flight change fee = $300 credit on Delta.    But more importantly I have the option of waiting and seeing if things getter better in Mexico, or booking another trip.   The swine flu could dissappear and I could end up with a even better deal in two weeks…

We got there around 7, and were told there was 1 hour wait for a table outside.  The restaurant is small, and has limited seating.  We put our name in, strolled next door and had iced coffee while we waited.  We came back after 45 minutes, and checked on our table while waiting at the bar.

They were able to accommodate us little early.  While we waited we for our table to cleaned off, I heard the hotess talk to an older couple a few seats down.  She told them that there weren’t any no shows and it would be at least another half hour to hour wait for a table.   They were of course free to eat at the bar which they chose to do.

We sat down shortly, and from over my girlfriends shoulder I saw the couple eating akwardly.   The bar at the restaraunt is not designed for eating.  The bar is intended to serve as waiting station for a table, not a place to share tapas.  The bar is extra high, chin height while seated on the bar stools.

I mentioned to my girlfriend that I felt bad for the older couple.  She concurred.  We quickly discussed, and decided that we should give up our table to the couple.  We were in no hurry to eat.  I caught the eye of the hostess, and let her know of our decision.  The hostess was extremely appreciative of the offer, and arranged for the older couple to take our table.

Back at the bar, we waited for another table.  The manager, and I believe owner, informed of our decision offered us drinks on the house and told us that we would have the next table for two.  We waited another 15 or so minutes and were seated with drinks in hand.

I was happy that my bill for the evening was $20 less than usual, and happier still that we did something “good.”   When the couple waited at the bar, I had already thought about giving up my table, but didn’t do anything.  I was lucky that I had another opportunity to correct my initial inaction.  Too often, we don’t have a second opportunity to do the right thing.   It’s better that we be our better selves at first opportunity rather than try to make amends later.

One can debate if the Government should be involved at all in rehabilitating the auto industry.  Is it in the national interest to save the industry?  Does it make sense for the Government to make decisions for a private industry (even one it’s bankrolling)?  There are good arguments to make on both sides of those questions.   What is clear, however, is that the Government should not be letting the banks or any other private party to push either the Auto industry or it around.

One the smartest things that the adminstration has done in the course of the Auto bailout was to put bankruptcy clearly on the table.   By putting bankruptcy on the table, the auto industry and the government are both better able to bargain from a place of strength.  Bankruptcy is the ultimate bargaining chip.  What is better argument for debt relief than saying, “don’t give me what I want, and I’ll give you nothing.”