Green initiatives are often promoted as paying for themselves, leading to widespread acceptance. Why wouldn’t we do things that also have environmental benefits if they have little or no financial cost? When considering such matters, it’s important to use conservative estimates of the true costs.

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?

If you’re like me, you probably have a half dozen or more of those little rewards cards dangling from your key ring. Mine are for the drug, grocery, book and sporting goods stores I visit the most often.

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?

Back by popular demand! Join us tomorrow for a free 30-minute online Webinar that will show you to How to Put Your Cash to Work with Lending Club.

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.

(space is limited)

Wednesday, June 23, 2009
12:30pm PT/3:30pm ET

On Friday we launched a new feature that gives you a measure of your performance to date and how it stacks against the entire Lending Club investor community. The Net Annualized Return measure is calculated daily as a weighted average return on invested capital and is based on actual payments received to date in your Lending Club portfolio.

This new feature leverages our transparency and gives you an up-to-date snapshot of all investors in our financial community.

This feature helps establish some interesting facts on our investor community performance as of June 7, 2009:

• The average net annualized return of all investors is 9.90% since June 2007.
• Investors in the $50,000-$60,000 range are currently achieving the highest net annualized return at 11.96%.
• Over 88% of all investors are earning a net annualized return of 6% or more.
• Over 74% of all investors are earning a net annualized return of 9% or more.

Just as a reminder the Notes are offered by prospectus, which can be downloaded here.

As always, feel free to drop us a note with your comments on these new features and share with us any additional feature ideas.

Rob

Dear Lending Club Members,

As more of you are saying “no” to credit cards and are choosing the path of responsible credit, and as more investors look for higher returns after last year’s devastating stock market performance, our financial community is showing better results than ever.

This week we are releasing new data showing strong growth among both Lending Club investors and loan originations:

• From January 1st to May 31st 2009:
  • 60% growth in total loans issued by Lending Club, from $25M to $40M
  • 70% growth in total Lending Club membership from 82,000 to 140,000
  • 72% growth in loan applications, from $212M to $365M
• The average net annualized return earned by Lending Club investors since June 2007 grew from 9.05% as of December 18, 2008 (as reported by analyst firm Javelin Research at that time) to 9.90% as of today.

These excellent results demonstrate the responsible behavior of our community of investors and borrowers and show that in the long run, sound underwriting and cautious investment beat the most aggressive strategies.

Better Rates, Together.

Renaud