Consumer credit went up 5B in February

most people are fine in their equity. The economic illiterate turbo lib wing of my party is misguided in there domesday rhetoric. As evidenced by Darala getting her head shoved up her ass on the dried up credit statement.
 
almost everyone in a house 10 years is way up. And most 5 yrs are up. Yes a lot of speculators and dumbasses late to the party got burned. Before on of the big market crashes maybe 87 a large fund manager said when cabbies and shoe shine guy's started giving him stock tips he knew it was time to sell.
 
uscitizen said:
Some areas are still doing well on real estate and some are mediocre and some dismal.
Click to expand...

Though one would think that it would be taken into consideration what the housing market had been historically in that area? I KNEW the area I was moving into, while a step down housing wise, I knew it had excellent schools, which was of the utmost importance to me at that time, as my children were of 'that age.' I could have bought a single family home in another 'good suburb', but the schools were not as good. Ahem, 'know one's priorities.' So, a townhome it was.

Held the value.
 
Frankly, I do not view continued growth in credit spending a good thing. What do you suppose the average household these days spends on the interest of all the stuff they purchase on credit? Suppose we subtract out interest paid on mortgages or even car loans. I'll bet it still adds up nation wide to a hell of a wad of cash going out every month to simply pay for having borrowed money to buy things people weren't willing to wait and save for.

Now, imagine all that cash going out to pay for goods instead of paying for past borrowing. What would THAT do to our lagging economy?

In short, a slowdown in credit spending is, IMO, a GOOD thing. As a society we need to get away from the whole immediate gratification attitude. Save for that big screen TV instead of buying it now. Put the same $50/mo you'd be paying your credit card company in an envelope, and you'll have the TV in half the time it would take to pay off the credit card. Then you can take the money you save by not paying interest charges and buy something else you want. Now you have twice as much, and with zero debt.

I have never bought anything other than my house on credit. I buy used cars because they are more affordable so I can pay cash for them. I have a savings account specifically earmarked for buying my next car. Each month I transfer about half what most people's car payments are into that account. I buy a two-year-old car every 5 years with cash. Having a car without a lean also saves me a ton on insurance since I can get away without full coverage.

When I see something I want, like a new TV or set of golf clubs, and do not have the money on hand, I make an envelope and write the name of the item I am saving for on it. Every week I put some money in the envelope until I have enough to buy the item. My current envelope is labeled "boat". I am about 2/3 of the way towards a new 14" aluminum fishing boat with 20 HP motor.

If more people went to a pay-as-you-go status we'd see a lot healthier and more stable economy as a result. We keep (uselessly, but not completely without hope) demanding our government evolve a pay-as-you-go budget. Why do we not demand the same of ourselves?
 
Good Luck said:
Frankly, I do not view continued growth in credit spending a good thing. What do you suppose the average household these days spends on the interest of all the stuff they purchase on credit? Suppose we subtract out interest paid on mortgages or even car loans. I'll bet it still adds up nation wide to a hell of a wad of cash going out every month to simply pay for having borrowed money to buy things people weren't willing to wait and save for.

Now, imagine all that cash going out to pay for goods instead of paying for past borrowing. What would THAT do to our lagging economy?

In short, a slowdown in credit spending is, IMO, a GOOD thing. As a society we need to get away from the whole immediate gratification attitude. Save for that big screen TV instead of buying it now. Put the same $50/mo you'd be paying your credit card company in an envelope, and you'll have the TV in half the time it would take to pay off the credit card. Then you can take the money you save by not paying interest charges and buy something else you want. Now you have twice as much, and with zero debt.

I have never bought anything other than my house on credit. I buy used cars because they are more affordable so I can pay cash for them. I have a savings account specifically earmarked for buying my next car. Each month I transfer about half what most people's car payments are into that account. I buy a two-year-old car every 5 years with cash. Having a car without a lean also saves me a ton on insurance since I can get away without full coverage.

When I see something I want, like a new TV or set of golf clubs, and do not have the money on hand, I make an envelope and write the name of the item I am saving for on it. Every week I put some money in the envelope until I have enough to buy the item. My current envelope is labeled "boat". I am about 2/3 of the way towards a new 14" aluminum fishing boat with 20 HP motor.

If more people went to a pay-as-you-go status we'd see a lot healthier and more stable economy as a result. We keep (uselessly, but not completely without hope) demanding our government evolve a pay-as-you-go budget. Why do we not demand the same of ourselves?
Click to expand...

Yeah a good thought or two there, but a couple of problems. It will take the average american probably 5-10 years to pay off their auto and misc debt.
And for the most part they will be buying very little else while they are paying it off.

Also the growth over the past several years has been largely based on excessive consumer and govt spending.
 
uscitizen said:
Yeah a good thought or two there, but a couple of problems. It will take the average american probably 5-10 years to pay off their auto and misc debt.
And for the most part they will be buying very little else while they are paying it off.

Also the growth over the past several years has been largely based on excessive consumer and govt spending.
Click to expand...
But if they bite the bullet and pay it off instead of maintaining a load of debt, they will be much better off for it. The economy will slow down, and we'll need to weather a recession. But we're gonna weather a recession anyway. Better to weather a recession that will lead to long term gains than keep the way we're going and face a full blown depression.

Also, it has been a hell of a lot longer than the past few years that much of economic growth came from deficit spending. Try since the mid 70s. Economic growth from deficit spending, whether from governments or individuals, only leads to a fragile, unstable economy. The instability of the economy with all its short cycle ups and downs is due in large part to the fact that people are outspending their means.

We have a rough road ahead of us. The housing credit crisis is only one of many that are going to crop up over the next couple decades. But if we, as a society, start moving toward a pay-as-you-go life style, it will be easier to weather the upcoming crises. However, if we blithely continue to spend, spend, spend, and worry about paying later, we're gonna take it in the shorts big time.
 
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