According to a recent Newsweek article, Are We Underestimating the Cost of Going Green, author Robert J. Samuelson argues that in far too many cases, computer models make assumptions that are much too optimistic. As someone who models complex systems regularly for my day job, I can tell you how quickly the accuracy of a model can diminish when faulty assumptions are made. Even the best of models is only as good as its worst assumption.

I am not suggesting that we should blatantly disregard modeled results. In fact, they are often highly accurate and superior to other estimation methods. I simply try to approach all cases where things seem too good to be true with a moderate amount of skepticism. Would you blindly trust a stock-picking algorithm that promised above-average returns for below-average risk? No, you need to balance modeled results with known laws and rules, such as, it takes more risk to achieve more reward.

As stated previously, there are certainly non-monetary reasons to transition to a greener lifestyle. On a micro scale, you often see monetary benefits as well. A simple change, like transitioning to energy-efficient appliances, really can save you more than the cost of the upgrade over time. On a larger scale, coming to accurate cost conclusions can be more difficult. Green initiatives are also a politically charged topic. Supporters can produce highly favorable models as quickly as denouncers can produce ones with conflicting results. A minor change of assumptions can have a major effect on the results. So take the steps you feel are necessary to achieve a greener lifestyle, but remember that it will probably cost more than the supporters suggest and less than those opposed would have you believe.

Did a green project you implemented cost more or less than you expected?

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Recently Panera Bread did away with its stamped card for a free cup of coffee after purchasing so many in favor of one of those rewards cards. While the company didn’t ask for any of my personal information, most card issuers do.

By using these “membership” or “loyalty” cards, you receive discounted prices, points or cash back toward future purchases that you otherwise wouldn’t receive.

I am a member of the group that has provided my personal information multiple times. I look for my Extra Bucks at the bottom of my CVS receipt at the end of each quarter. And I have probably visited Panera Bread more since I received the card now that the store offers me a free pastry or coffee after so many lunches I buy.

When you load groceries into your cart, you're probably not worried about whether your supermarket chain is compiling a profile of you based on what you buy, and storing that information for its own use. After all, who cares if you buy one brand of laundry detergent over another, or prefer name-brand frozen dinners rather then store brands?

Supermarket chains care and so does your drugstore. While these discount cards offer you what seem like great bargains, stores are using them to keep tabs on what you purchase, how often you shop, and what your buying preferences are.

According to a 2004 poll conducted by Boston University's College of Communication, 86 percent of American shoppers use some form of store loyalty or discount card, and the majority of them say the benefits of the card are worth giving up some privacy.

While retailers maintain that they only analyze collective data, some critics have questioned whether it isn’t just a matter of time before records of individual consumer preferences are either sold to third parties or made available to investigatory agencies. In fact, some apparently isolated examples of that have already occurred.

For example, in a 2004 Washington state case, a suspected arsonist was arrested after police tracked down a fire-starter unit with a Safeway label attached. Safeway provided police with the suspect’s purchase history, revealing that he had bought a fire starter a month earlier. The charges were later dropped, but the point is that the store gave access to the customer’s personal information to authorities.

Are you willing to surrender some personal information about yourself to save money?

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For new investors and those just considering Lending Club, we’ll give you an overview of how Lending Club eliminates the high cost and complexity of traditional banks and offers investors the opportunity for returns that average over 9% annually (see report). Notes offered by prospectus filed with the SEC.

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Wednesday, June 23, 2009
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