Posted by
James Burns on Friday, October 24, 2008 8:24:07 PM
With the stock market crashing and credit crunching, everyone all over
the world is reeling. Markets in every country are selling off and
people are hoarding their cash. I do not this is a bad thing, but a
good thing.
Over the past years credit has been easier and easier to get. Banks
giving car and home loans for little to no money down. Credit card
companies sending cards to people who never asks for them luring them
in. Equity companies and other credit givers sending people checks
ready to cash and spend. So no wonder we are in the bind we are in.
People have become credit addicts. When a new offer for credit comes in
the mail or a store offers no interest for a year when you put your
purchase on their card people start to jones and take the bait, like a
crack addict given a rock for free. What these people don't realize is
how I am going to pay for it.
The rush of acquiring the newest I-Phone or 72" HDTV in an instant is
like the gratification a hit off the crack pipe gives an addict. The
need for instant gratification in todays society is so prevalent that
no one will even consider saving money to buy something. Just put it on
the card and worry about it later. People out there have been living on
credit and investing their cash and worrying about the consequences
later. Yeah the E-trade account is worth $150,000 dollars, but your
credit cards are $45,000 dollars, your mortgage is $300,000 dollars and
your car is $40,000 dollars. So what money is being made? These people
barely make the payments, but won't touch the E-trade money to pay down
debt. Just scrape by. But know that everything is falling, the E-Trade
account is now worth $20,000 dollars, the mortgage is still $300,000
dollars but the value of your house is $200,000 dollars, so they walk
away while the repo-man is looking for the car. This is a scenario
being played out all over.
Car dealers and mortgage brokers adjusting peoples income so they will
qualify for a loan has done a lot of danmage. Sometimes even waiving
those basic requirements to make sure the loan gets paid, in exchange
for making the deal and the bonus. These lenders know that the loan
will be sold to someone else so once the broker makes his money someone
else will have to deal with it if it doesn't get paid.
Our own government is a junkie, just like most of America. We as a
nation have borrowed money hand over fist without even blinking an eye
or worrying how it will get paid. So if the government has this
attitude, then why not its people. So now people are running scared,
having no money saved up. Standing on the proverbial street corner
waiting for the dealer for their next fix. Hoping he comes and extends
the credit line to make it one more month. But the dealer got busted.
He now sit in jail with no hope of getting out. Reality has set in. Our
nations biggest creditor, China, will not lend to us anymore.
So here we are in rehab. The biggest 12 step program in existence.
People are going to have to relearn their behaviors. People are being
forced to save their cash in order to survive. No more trading the car
every year for the newest model. No more buying the next best i-Phone
or the newest biggest T.V. Businesses that functioned on credit are
going under because the only thing that kept them around was their
unlimited credit.
Our government tried to give the economy a $700 billion dollar
methadone shot, but it didn't work. The withdrawls are worse than ever.
The only solution here is quitting credit cold turkey. Time to start
the Creditoholics Anonymous meetings. Lets all stop living the Macy's
lifestyles on the Walmart budgets.
Lastly we cannot elect a government in this time who wants to spread
the wealth and spend more of what we don't have. This will only make
things worse. The modern Community Organizers like to "help" people,
but really they only keep people down for job security.