Illustration: Michael Klein for Newsweek

Let Ben Bernanke worry about the world—you worry about your wallet. Some economists are predicting the first U.S. recession since 2001’s slide, when the stock market dropped as much as 30 percent, personal income fell sharply and more than 2 million jobs disappeared. It’s nice that Washington wants to throw some stimulus your way, but don’t bet everything on that $600-per-taypayer check. Here’s how to protect yourself from bad times.

Protect your job. Stay visibly busy, says New York headhunter Stephen Viscusi. The first employees to go during a recession are the high-maintenance slackers. Come in early, leave late, eat lunch at your desk and try to figure out how you can make your boss’s life easier and more profitable. Update your résumé with all your current skills and accomplishments, even if you’re not planning on job hunting. You can post that résumé, absent your current employer’s name, at online job sites like Monster.com, just to see what else is out there. If you’re ready for a change, Vault.com reports that health-care and sales careers are the most promising and protected during downturns.

Protect your portfolio. It’s a little too late to sell off your stocks: now you stand a good chance of selling low and then trying to buy in high later. So stick with your plan, and use Wall Street’s dismal days to cherry-pick bargain stocks for the next expansion. It always comes, says Sam Stovall of Standard & Poor’s, who points out that most bear markets recover in less than a year. Which stocks do best when the economy is at its worst? Alcohol, tobacco, health care, gaming, utilities and consumer necessities. S&P is recommending Budweiser, Colgate-Palmolive, LabCorp of America and Altria as some promising picks.

Don’t rush into bonds, and be especially wary of bond mutual funds, counsels financial planner Sheryl Garrett of Shawnee Mission, Kans. With interest rates low, yields aren’t worth the effort. And once the economy strengthens enough to see higher rates (which are necessary to keep pulling in foreign investors, too), the value of those bonds, and the funds that hold them, will fall.

Protect your pocketbook. Make paying down your debts a priority, counsels Garrett. Kill the credit-card balance as quickly as possible, even if you have to give up new clothes and nights out to do it. You can even draw down your emergency savings account to pay off the credit card, as long as you keep the card balance at zero after that. Then you could use the card in an emergency until you rebuild the fund. Apply for a home-equity line of credit, so it’s available for emergencies, but don’t use it. Consider refinancing your home mortgage while the Federal Reserve is holding rates down, especially if you have an expensive or risky loan now. Don’t be shy about holding cash in safe, stable, boring spots like FDIC-insured bank certificates of deposit.

Protect your psyche. Remind yourself that recessions are a normal part of a healthy economic cycle, and resist panic. To stay calm, write a list of all the extra ways you could make or save money in a pinch: share a car or rent out a room of your house. When you have options, it seems less scary.

And don’t feel guilty about disappointing our nation’s leaders if you use the stimulus package to put your financial house in order. When that government check comes, probably sometime in March, don’t spend it. Use it to pay down your credit-card bill, or put it to work in your retirement- or college-savings account. Think of it this way: if you’ve got debt, you’ve already done your patriotic duty by buying all that stuff in the first place.

Go to Disneyland for a chance to win a free stay in Walt Disney’s secret lair (uncompleted at the time of his death), a 2,200-square-foot apartment above the Pirates of the Caribbean. Every day for the entire year a lucky park guest will be randomly selected to stay the night—free. For more details log on to disneyparks.com.

This week the town is aflutter with Hollywood celebs and wannabes as the 17th annual Sundance Film Festival takes over through Jan. 24. Though the streets and restaurants are packed with glitterati and Looky Lous, it's not too late to book; there's still room at the lodge. And if you just want to play in the snow, there's plenty of thrill-seeking fun. Tara Weingarten, a special correspondent in the Los Angeles Bureau, loves to visit Park City in the winter, but this week she's happy to watch all the stars jet away and leave Tinseltown's freeways a little less congested.

Ski and Snowboard: Not surprisingly, the runs are empty this week, as most visitors are desperate to catch a celeb or see the next blockbuster flick. If you're game, hit the challenging Canis Lupus run at the Canyons ski area, which is also a great place to stay, with rooms—many with kitchens and fireplaces—still available (thecanyons.com). Loved for its milelong natural halfpipe, which doles out radical banks and turns, it starts at 10,800 feet. And if you're really an adrenaline junkie, hop onto the less crowded DreamCatcher and DreamScape lifts, where you'll find fresh powder even days after a snowstorm.

 
Illustration: Chris Gash for Newsweek

If your parents are unhappy, are you destined for unhappiness, too? Psychologists used to believe that genes played a determining role in our state of mind. But new research is finding that people can do more than previously thought to improve their outlook on life. “Things are more complex than simple genetic models suggest,” says Ed Diener, a professor of psychology at the University of Illinois who researches subjective well-being. “People are stuck with the genes they have … but we know that adult personality can change, and people probably have some control over this.”

How much control is still a matter of debate within the field. In a new book, “The How of Happiness” (Penguin Press. $24.95), Sonja Lyubomirsky, a psychology professor at the University of California, Riverside, proposes that a full 40 percent of our happiness is within our control. Using data from research on identical and fraternal twins, she concludes that an additional 50 percent is determined by genetics. The remaining 10 percent is dictated by circumstance—like a recent divorce or a financial windfall. “In the past, we’ve heard you can’t make people happy sustainably because happiness is genetic or because life’s circumstances won’t allow it,” says Lyubomirsky. “I argue that there are things we can actually change.”

Lyubomirsky, who has been studying happiness for nearly two decades, offers a dozen so-called happiness intervention strategies in her book, all backed by her own or others’ research. With help from a National Institute of Mental Health grant, she and colleague Ken Sheldon have conducted or reviewed dozens of studies with participants who, for example, wrote letters of gratitude, performed conscious acts of kindness or kept a “best possible selves” journal to outline future goals over six or more weeks. When compared with control groups, those who performed the activities regularly reported “significantly bigger” increases in their happiness levels, as compared with before the intervention. “Even nine months later, we still saw the effects: those who continued to practice these strategies had more sustained happiness,” she says. Here’s more advice from the book:

Don’t overthink it. When you catch yourself stewing over something, tell yourself, “Stop.” Or set aside 30 minutes late in the day to do nothing but ruminate. Chances are, when the appointed time comes, the issues that plagued your thoughts earlier will seem less consequential.

Learn good coping skills. Write down traumatic experiences and learn how to recognize, and argue with, overly pessimistic thoughts.

Savor life’s joys. Relish ordinary experiences, like a good meal or a hot shower; conjure up a favorite memory when you’re down.

Cultivate optimism. After studying Lyubomirsky’s strategies, photographer Kelly Radinsky, 45, set aside time each evening when she, her husband and two kids, ages 5 and 9, take turns sharing the favorite parts of their day.

Lyubomirsky recommends only trying strategies that match your personality and repeating them only as often as they fit into your schedule (otherwise, they could seem like obligations). She admits that some suggestions may sound “hokey” but stresses that they are based on controlled studies or correlational data showing they can significantly improve participants’ level of happiness compared with those who do not perform the exercises.

“This isn’t someone standing up and saying, ‘Just think positive thoughts.’ She’s doing rigorous research,” says Alan Kazdin, professor of psychology at Yale University and president of the American Psychological Association. “We’ve learned over the past few decades that there are strategies you can use that can actually change the brain, change behavior and then mood and understanding follow.”

Radinsky, who inherited “dark genes” from an abusive father and suicidal mother, says she sometimes has to work at making Lyubomirsky’s strategies a habit, but it’s worth it. “I think they can make the difference between a happy and an unhappy life,” she adds. That’s good news for the pessimists among us.

The fanboy crowd in San Francisco roared loudest at the MacBook Air. A gorgeous three-pound computer with a sleek aluminum skin, so thin that you could slip it under a door, it’s the Kate Moss of laptops. At $1,799 it has limited storage, a nonremovable battery and no DVD drive, but stylish road warriors will love it.

Go to Los Angeles for dineLA’s first annual restaurant week. Indulge in three-course meals from some of L.A.’s top restaurants, like Crustacean and Simon LA, from $15 or $22 for lunch and $25 or $34 for dinner (Jan. 27–Feb. 1 and Feb. 3–8; dinela.com).

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Photos courtesy of (from left): Belkin, Neonode, Polaroid, iHome*

By N'Gai Croal
Jan. 21, 2008 issue

Even if you factor in the jaded streak that runs through most tech journalists, the oft-exchanged phrase at last week’s Consumer Electronics Show, “More of the same,” was a legitimate assessment of the gadgets on display. That said, we did manage to dig up some products worth highlighting. One was Jook, a hardware add-on for digital audio players that would permit you to broadcast your music wirelessly to other Jook-enabled music devices within 30 feet, or to listen to music being broadcast by other users and tag songs for purchase the next time you dock your player with your PC. Another was Seagate’s D.A.V.E., a Bluetooth- and Wi-Fi-enabled pocket-size hard drive that allows you to access any audio or video files on it from devices as varied as iPhones, laptops, car stereos and more. Here are some other products that caught our eye.

* Belkin Surge Protector, $50: This remote-controlled power strip lets you shut off devices without ducking under your desk.
* Neonode N2 Mobile Phone (price not announced): Its infrared-based touchscreen is more rugged than that of an iPhone or Palm. The device also plays music and movies.
* Polaroid Mobile Photo Printer, $150: Connect phones and cameras via Bluetooth or USB for two- by three-inch prints
* iHome iP47 Clock Radio, $150: iPod players with built in alarm clocks aren’t new, but the speakerphone for iPhones is genius. You can also stream MP3s to the iP47 from any Bluetooth device.

Our top picks for the week

Rent “Syndromes and a Century.” Our critic’s No. 1 movie pick of last year, this lovely Thai film about doctors, lovers and Buddhist monks is divided into two parts that mirror each other—one set in the city, one in the country—and is unlike anything you’ve ever seen.

Recycle your old cell phone with help from the Environmental Protection Agency’s new campaign. Go to epa.gov/cellphone for a list of drop-off locations, many at major retail stores. You’ll help lower greenhouse-gas emissions and keep reusable materials out of landfills.

Book a stay on the Underground Railroad. Visit bedand breakfast.com (click on “Press Room”) for a list of inns that helped slaves on their road to freedom. Many of the B&Bs are offering special packages for Martin Luther King Jr. Day weekend and throughout Black History Month in February.

Buy Microsoft Office for Macintosh ($150 to $500). The first major upgrade of the popular Word, Excel, PowerPoint suite for Apple computers in four years brings your Mac up to speed.

Read “David Golder” and other novels in a newly published collection by Irène Némirovsky (Everyman’s Library. $25). The Kiev-born French writer died at Auschwitz in 1942 but scored an international best seller last year in the posthumously published “Suite Française.”

In New Zealand you can explore the land of the hobbits--but don't forget the vibrant Maori culture or delectable cuisine. 

Abandoned by her brothers for the holidays, NEWSWEEK's Ginanne Brownell and her mother took off on an Antipodean adventure in New Zealand. Traversing the islands by car, they soon discovered it always takes twice as long as expected to get anywhere because of the windy roads, car-stopping scenery--and, of course, all those sheep.

Rotorua: Some call it the Las Vegas of New Zealand, although there are no casino slots--just lots of tourists. The small city, located in the central part of the north island, is famous not just for being the heart of Maori culture, but also for its thermal springs and bubbling mud. Head to Whakarewarewa (www.whakarewarewa.com), a Maori village in the midst of the thermal reserve. Locals provide tours of the village, and you'll have the chance to watch traditional Maori dancing and singing and enjoy delicious corn boiled in the thermal waters. (Note: add the butter to the plastic bag and shake -- don't be dumb like me and spread the butter with your bare hands. It's messy and you'll give yourself away as a tourist!) Te Puia (www.nzmaori.co.nz), a Maori cultural center, lets you glimpse traditional weaving and wood-carving workshops amidst the geysers. (Pohutu, the largest, erupts between 10 and 20 times a day.) Stay for a Hangi lunch—meat, potatoes, carrots, onions and corn are cooked in the ground over hot river stones. Delicious and different!

In the past few years, intrepid travel writer Kristin Luna has ping-ponged all over the globe. Here, she rehashes some of her favorite facets of life in Holland:

Eats: The Netherlands isn't known for its gourmet cuisine--the Dutch dining philosophy is to deep-fry everything and serve with fries, hold the salad--but thankfully the country offers every international cuisine under the sun (an ambler might find Ethiopian, Argentinean and Moroccan establishments all within a 100-foot stretch). With an Arabic population of more than 1 million, some of the best fare is North African and Middle Eastern: it's cheap and easy and rarely disappoints. My daily lunch staples were Turkish pizzas or falafel from any of the ubiquitous, colorful dives that dot Utrecht. For one of the tastiest alternatives in town, stop by the Surinamese stand in the middle of Neude Square and order the roti kip, a pita stuffed with chicken, potatoes and green beans (tofu options are available, as well). If you're set on trying the regional fare, grab a cone of thick Flemish fries from any vendor. They're not significantly different from "freedom fries," but served with mayonnaise in lieu of ketchup.

Biking: The Dutch bike everywhere: grocery stores, shopping malls and even the bars. If you're staying in one place for a considerable amount of time, you might consider buying a second-hand set of wheels to help you get around. It's great exercise and more reliable than the country's public transit. The Utrecht police station holds an auction once a month where you can purchase a used bicycle for as little as five or 10 euros (check the tourist office in Neude Square for details upon arrival); at any time, you can find "bicycle black market" vendors near the train stations. Buy the loudest, crummiest one possible, as bike theft is a common occurrence. Or consider renting one for the day at any sporting-good store (watch for signs boasting "fiets," the Dutch word for bike).

Drinks: You needn't look further than Utrecht's main canal, Oudegracht, and its myriad drinking institutions to whet your appetite for quality European brews.

 

 
Illustration by Tim Bower for Newsweek

 

Bill Barnes and Sara Cole are downwardly mobile. In the mid-1990s, the Seattle couple was living large on two Microsoft salaries and no big responsibilities. Sara, now 38, gave up her job when daughters Theo, 7, and Rosie, 4, came along. Then Bill, 41, an artist, developed “Unshelved”—a comic strip that he loves far more than the commute and the cubicle. So he quit, too, leaving Microsoft last month to go solo as a cartoonist and pushing his family farther down the security and income spectrum.

Last year Bill raked in roughly $180,000. This year, if he’s able to build the comic strip as he hopes and do some consulting around the edges, he might earn $80,000. The couple has carved up the family budget; they’ve moved to a smaller home, limited their restaurant meals and begun to shop at thrift stores. But they’re happier. “I think I’ve held my last job,” says Barnes.

He and Cole are part of a minitrend, says Chicago outplacement consultant John Challenger. The percentage of married couples with two sal-aries peaked at 53.4 percent in 1997; now it is 51.8 percent. Husbands and wives are leaving jobs midcareer, some to stay home with kids, others to help ailing parents and others to tend their own fledgling businesses. And some, of course, get laid off. Here’s how to make the transition to a smaller, perhaps sweeter life.

Run the numbers. They won’t be as grim as you think. The first thing you give up with the second salary is taxes. When a husband and wife each earn $50,000 and one quits, the tax savings off the top are $14,825, calculates Bob Scharin, a senior tax analyst with Thomson Tax & Accounting. You’ll also save money on downtown lunches, fancy work clothes and all the other things you buy—from convenience meals to child care—to make your working life easier. To find out exactly how much of a gap you’ll be left with, crunch the numbers with these online calculators: kiplinger.com/tools/managing/afford.html and parents.com/ app/stayathomecalculator.

Ease into it. If you have the luxury of planning your exit, start living on less as soon as possible. Bank extra cash in a rainy-day fund. Apply for a home-equity line of credit before you quit, just to make sure you have a source of cash for emergencies.

Squeeze the budget. Some couples find extra cash by cutting their retirement contributions and college savings during the first lean year or two. That’s OK, but it’s better if you can keep saving and close the gap by living below your means. When Lewes, Dela., financial planner Burt Hutchinson’s wife, Pam, left her job, the couple made a list of possible savings. Among them: stretching their mortgage with a 30-year fixed loan, which they haven’t yet done.

Then spend more. Buy term life and disability insurance for the family breadwinner and consider term life insurance for the stay-at-home spouse. If necessary, use the quitting spouse’s COBRA benefits to keep the family health insurance. If you’re still able to save for retirement, set up a spousal Individual Retirement Account for the nonworking spouse, to make sure his retirement savings keep pace.

Keep the career fires burning. It’s one thing to drop out of the work force for a while; it’s another to give up contacts and skills that will ease your transition back. Yvonne Lefort, a career consultant from Moraga, Calif., who specializes in stay-at-home moms, tells them to meet former colleagues for coffee, take classes to keep their tech skills alive and attend the occasional profes-sional conference.

Renegotiate the partnership. Sometimes the biggest adjustment when a couple transitions from two jobs to one isn’t the budget, it’s the marriage. “We had to do a lot of work in our relationship when we switched to a traditional bread-earner/stay-at-home-wife deal,” says Barnes. He puts all his earnings in a joint account and then he and Cole draw equal but small amounts for personal spending and gift giving. The quitting spouse might be sacrificing a career for the sake of a family, or the working spouse may be sticking with a less-than-wonderful job to support the quitting spouse’s dream. “If there are quid pro quos involved, it’s important to make them explicit,” says San Francisco financial adviser Milo Benningfield. “Make sure each partner agrees on the reasons for the transition and acknowledges each other’s efforts, sacrifices and good will in helping to make it happen.” So talk about it, every step of the way. Without that pesky job, you should have plenty of time.

Rent “The Riches.” In this darkly comic series, Eddie Izzard and Minnie Driver head a family of grifters who play house in Baton Rouge, La., assuming the identities of the titular family. Good thing the show has a humorous tone, because its theme is pretty dour: their American Dream is a big, fat lie. Then again, whose isn’t?

Buy the Eyeglass Rescue kit. Slip this small identification sleeve over the bar of your glasses and ensure that you never lose them again. Each sleeve is inscribed with an ID number that gets entered into a national database when you call a toll-free number ($15.99; eyeglassrescue.com).