• The US consumer is debt burdened with the debt to disposable income having increased from 70% in the early 1990s to 100% in 2000 and to 140% in 2008.

• The value of housing wealth is now sharply falling by over $6 trillion as home price depreciation will soon be 30% and reach a cumulative fall of over 40% by 2010. Recent estimates of this wealth effect suggest that the effect may be closer to 12-14% rather than the historical 5-7%. And with home prices falling over 30% about 40% of all households with a mortgage (or 21 million out of 50 who have a mortgage) will be under water (negative equity in their homes) with a huge incentive to walk away from their homes.
• Mortgage equity withdrawal (MEW) is collapsing from $700 billion annualized in 2005 to less than $20 in Q2 of this year. Thus, with falling housing wealth and collapsing MEH US households cannot use their homes anymore as ATM machines borrowing against them.
• Employment has been falling for 10 months in a row and the rate of job losses is now accelerating.

Read more on Roubini’s website, RGE Monitor.

(1) Travel to cheap exotic places and have a real adventure: hike the Inca Trail to Macchu Picchu, go trekking in Nepal, backpack around India, Sri Lanka and Burma. For the Inca Trail, check out Peru Andean Experience.

(2) Go on a meditation retreat for several months. In the US, the Insight Meditation Society in Barre, Massachusetts has a three-month retreat (http://www.dharma.org/ims/retreats.php), as does Tassajara (Zen Buddhist retreat center) in California. In India, you can immerse yourself in a vipassana retreat in Bodh Gaya or Sarnath: http://www.bodhgayaretreats.org/.

(3) Go on a yoga holiday in Goa, India: http://www.ashiyana-yoga-goa.com/yoga-holidays.shtml.

(4) Volunteer for charity work in developing countries or for Greenpeace aboard one of their ships.

(5) Get away — deep into your mind by taking a course that develops your creativity. Take a class in creative writing, painting, photography, sculpture, cooking, DJing.

I am in Amsterdam right now and I have never seen it this quiet. Where are all the tourists? Usually in the early fall, there are a lot of British, Italian, French and Spanish tourists in the Nine Streets neighborhood where I live (which has a lot of cool boutiques and restaurants). But it’s eerily quiet. The shops are empty, the cafes feel like vast tombs. Last night I went out to dinner with my Malaysian friend at a restaurant that’s usually packed, and it was empty. Where’s everybody?

In San Francisco, I’ve noticed how easy it is to get a table at restaurants where, in the bad old days, one would have to reserve several weeks ahead. In fact, I was able to get a table easily at two of the wine bars I frequent in SOMA. Have people really just stopped going out?

Do you also see the effects of the credit crisis in your city?

Meanwhile, US Fed chief Ben Bernanke says he’s ready to cut interest rates dramatically to stop a recession in the US (and further prop up housing prices that are already way too high). Let the good times keep rolling. We can breathe easily now.

But Spanish real estate is looking grim these days. In a Financial Times article, a Spanish bank manager says: “I’ve been a bank manager for 28 years and I have never lived through a situation as dramatic as this,” says the branch manager of a regional savings bank, who asked not to be named. “House prices in this town have fallen by 20 per cent, there is no demand, and no mortgage finance. Savings banks have cut off funding. Before the credit crunch, I used to do 12 mortgages a month. Since August, my branch has approved only one new loan.”