Archives For debt

Not Spending Enough???

May 14, 2012

Source: Economy Watch – Bernanke says demand too weak to bring down jobless rate.

Consumers are not spending enough and businesses are not investing enough to put a big dent in unemployment, Federal Reserve Chairman Ben Bernanke said Monday

How many years have we heard about the dreadful effects of consumer debt in the country.  It is typically reported that the average family has more than $8,000 in credit card debt!  Everyone, including most economists, say we are just living beyond our means. But now here is the number one financial guy in the country saying we are in the trouble we are because we are not spending enough!

Someone needs to tell these guys that you can’t have it both ways without some serious increases in the average guy’s hourly wage increased spending won’t happen. Since wages haven’t gone up in almost twenty years now I don’t see us coming out of this high unemployment period anytime soon.

But what do I know….

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Paying the Fiddler…

January 5, 2012

This would be a great world to dance in if we didn’t have to pay the fiddler. – June 27, 1930  Will Rogers

I haven’t heard the phrase “Its time to pay the fiddler” in years. When I looked it up on Wikipedia it was shown to be a country music song sung by Ernest Tubb among others. It goes something like this:

Well it’s time to pay the fiddler
And it’s sad to know we’ve danced it all away
But the warm night’s disappearing
Leaving nothing but the cold hard light of day

Since “paying the fiddler” is in this Will Rogers quote it must pre-date this song but I expect that the meaning has pretty well carried over. This relays the same message as “burning your candle at both ends” or to us more nuanced we might say that “you eventually have to pay for the consequences of your actions”.  I kind of like the fiddler one the best though. 😉

For philosophical reason, whatever that is, let’s put this saying into perspective. We in the U.S particularly, but in the whole world in general, have been living on borrowed money  for too long. So maybe now it is time to pay the fiddler and that is what is happening now. Our economy has contracted due to people unable to sustain past spending practices.  Our credit cards are maxed out and since we are paying  18- 24% interest on them, the banks and their owners are getting wealthy, but we who have this massive debt can no longer afford to keep spending. Unfortunately this sequence of events played out at the same time as the financial institutions were getting more creative in where they got their ever increasing profits.

So here we are paying the fiddler. How long will it take to get him paid off? No one seems to know but I would bet it is for at least a few more years if we have the patience to keep up the payments.  Unfortunately, we in the U.S. are not known for our patience. What’s going to happen is anyone’s guess but I would guess that nothing good will come from our future actions if we don’t realize that we’ve danced it all away leaving us nothing but a cold hard light of day.

Enough of this silliness but what do I know….

Living Debt Free….

September 27, 2011

The average consumer carries over $16,000 in credit card debt. And there is usually a mortgage and probably a car loan in the pile too. They say the total personal debt of U.S. consumers is over $11 trillion.  Unfortunately many of those are middle aged and moving into their retirement years. With all this debt they are obviously not putting away much for their later life.

It is quite startling how much debt many seniors today carry into their retirement! Four out of ten carry a mortgage with them into their golden years. Almost five out of ten carry a $6,000 credit card debt!  My father taught me to “put money away for a rainy day”.  While that message stuck with me it obviously didn’t with many of my cohorts.

What makes one person maintain a lifestyle that is debt free while another piles it on? My father and his generation were called Depression babies as he was  six years old at the onset of the Depression of the 1920s. My grandfather had a pig farm and was not seriously affected by the depression but I still remember Dad’s stories about some of his neighbors who were very much affected. Depression babies like my dad did not like debt but for the most part they are all gone now and quickly being replaced by us baby boomers. From the evidence it looks like many of us have not followed in our fathers’ footsteps about being debt free. Why are so many so ill-prepared for their senior years? I’m sure part of it has to do with “wanting it now”.

For some who are on retirement’s door it is already too late and that means they have to keep working whether they like it our not. Unfortunately, even among this group, there will be those who because of health or other issues will not be able to work in their senior years. What will happen to them. Most likely they will be trying to live on basically Social Security benefits which average usually a little over $1,000 per month. What would happen to those if even the Social Security safety net were removed?  According to some in the audience at the latest Republican presidential debate we should let them die! I hope and pray we never become a nation who lets that happen! But sadly I didn’t hear of anyone on the stage renouncing that idea!

I see the results of trying to live on Social Security alone weekly at the soup kitchen I volunteer.  Our lunch and dinner guests increase by about 25% the last week of the month when the checks are running out. We all would like to say “that happens to others” but I’m sure the “others” did not believe it would happen to them either.  No matter how close to retirement you are it is never to late to be reigning back some expenses in order to save a few dollars.

All this political foolishness is getting insane. I just wish the president would grow a backbone and tell congress to give him what they gave the previous president seven times. Give him a “clean” bill that raises the debt limit in the next three days. Yes we need to look at spending but we don’t need to put the country in a totally unnecessary peril to do that. Those guys are risking everything I have spent my life saving for my retirement.

This game playing stupidity has gone on for much too long now.  Its time for some “grownups” in our nation’s capital to take charge…..   Where will we get them??

President Obama please don’t let me down once again.

But what do I know….

I have been a little shy about wading in on the debt ceiling stuff that is going on right now.  As you know I like to make jokes about what I say here and those Republicans in Congress are making me look like an abject amateur in that area. Most of this same group of yahoos rubber stamped seven (yeah seven) debt increases during baby Bush’s eight years in office. We did not even hear a peep out of them about anything to do with future generations or all those things we are hearing now.

The merrily passed all the expenses for Mr. Bush’s two foreign wars on to future generations by keeping them “off books”. Now all of a sudden they got religion and decided that debt is a bad thing and we can’t solve it in a rational manner because to them it is all of a sudden a huge emergency.  Could it possibly be due to the fact that there is now a Democrat in the executive office? They just didn’t seem to see a problem during the last eight years! All this stuff that is going on now is pure unadulterated politics and  nothing else! I think the average guy can see through all of this; I’m pretty average and it seems all to obvious to me 😉

All this stuff is politics pure and simple. If Mr. McCain were in office it would be business as usual on annual debt ceiling increases and passing our war bills onto future generations. That was all fine and dandy while a Republican held the White House. I just hope those jokesters in Washington don’t put us into yet another financial crisis like they did in 2008 by refusing to raise the debt this time. It takes them eight years of letting the CEOs have control of business to get us into the messes they did and now they proclaim that Mr. Obama should have been able to fix all that stuff in a year and a half so now he is to blame for everything now.  If these guys (and gals, I don’t want to be called a sexist) cause yet another financial melt down with all this “we won’t raise the debt ceiling” jokes I hope they will have to pay the piper in next years elections. But like always they think all us folks who put them in office have very short memories.

Personally I agree with the Republicans (don’t tell my Democrat friends) that our government are spending too much money and they have been for almost ten years now.  They need to find the purse strings and close them up some.  But we can do that in a sensible manner; it doesn’t have to be a big panic that sets us off into another depression. I can’t let this go by without sharing what Will Rogers said about this kind of stuff almost eighty years ago

Politics is applesauce. I hope I never get so old that I can’t peep behind the scenes and see the amount of politics that is mixed in this medicine before it is dished out as pure statesmanship.

Both parties have their good times and bad times at different times. Good when they are out. Bad when they are in.

But what do I know….