Three Christmas Presents from the U.S. Economy 15 comments
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As Christmas 2008 approaches, let's pause and see what the US Economy has given you this December:
1) Do you have a Home Equity Line of Credit? If so, according to Standard and Poor's Research, your balance is likely to be somewhere between $50,000 and $60,000. This means that in December 2007 your payment was about $400. This December? You know. It is closer to $200. That means two crisp $100 bills in your stocking.
2) Now you and I know that you don't pay off your credit card balances every month. That's because the average US household balance is now at about $10,000. But if you have negotiated well, your card balance is indexed to the prime rate. Even if your rate is not prime, it is probably indexed to prime and your interest rate is now almost 5% lower this year than at Christmas time last year. Guess what? Your credit card interest payments on that $10K are going to be at least $500 less next year.
3) And what about wages? What does Santa have in store? Here is the latest Federal reserve chart on wages:
click to enlarge
And the US Department of Labor indicates that hourly wages will be up by $.07 an hour. If you work 160 hours next month, that means another $11 in your pocket (excluding those double-time hours).
But wait, I want to leave you with just one more present. I know I said you were only going to get three, but you know -- it's the holiday season...
The average price of gasoline is now down $2.50 per gallon since its peak at $4 in July.
As you fill up that 20 gallon tank on Boxing Day this Friday, put another $50 in your pocket.
Happy Holidays!
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This article has 15 comments:
I want to share a story told by Sister Maria Jose Hobday, a Franciscan nun and author who has written and lectured internationally for 30 years on Native American spirituality, prayer, and simplicity. In the 1930s, her family was living on the edge of poverty:
"One Saturday evening I was working late on my homework. I was in the living room, my brothers were outside with their friends, and my parents were in the kitchen, discussing our financial situation. It was very quiet, and I found myself more and more following the kitchen conversation rather than attending to my homework. Mama and Daddy were talking about what had to be paid for during the week, and there was very little money -- a few dollars.
"As I listened, I became more and more anxious, realizing there was not enough to go around. They spoke of school needs, of fuel bills, of food. Suddenly the conversation stopped, and my mother came into the room where I was studying. She put the money -- a couple of bills and a handful of change -- on the desk. ‘Here,' she said, ‘go find two or three of your brothers and run to the drugstore before it closes. Use this money to buy strawberry ice cream.' I was astonished! I was a smart little girl, I knew we needed this money for essentials. So I objected. ‘What? We have to use this to pay bills, Mama, to buy school things. We can't spend this on ice cream!' Then I added, ‘I'm going to ask Daddy.' So I went to my father, telling him what Mother had asked me to do. Daddy looked at me for a moment, then threw back his head and laughed. ‘You mother is right, honey,' he said. ‘When we get this worried and upset about a few dollars, we are better off having nothing at all. We can't solve all the problems, so maybe we should celebrate instead. Do as your mother says.'
"So I collected my brothers and went to the drugstore. In those days, you could get a lot of ice cream for a few dollars, and we came home with our arms full of packages. My mother had set the table, made fresh coffee, put out what cookies we had and invited the neighbors. It was a great party! I do not remember what happened concerning other needs, but I remember the freedom and fun of that evening. I thought about that evening many times, and came to realize that spending a little money for pleasure was not irresponsible. It was a matter of survival of the spirit. The bills must have been paid; we made it through the weeks and months that followed. I learned my parents were not going to allow money to dominate them. I learned something of the value of money, of its use. I saw that of itself it was not important but that my attitude toward it affected my own spirit, could reduce me to powerlessness or give me power of soul."
Wishing you power of soul in abundance in the New Year.
Yeah right
Show me the credit card companies that are cutting rates. That home equity line of credit is eating and will continue to eat people alive, as they don't understand how it works. Hint, it does not work like an ATM card like you think it does
And the wages- did you see the numbers today? Income was actually down
The average American with a credit file is responsible for $16,635 in debt, excluding mortages, according to Experian. (Source: U.S. News and World Report, "The End of Credit Card Consumerism," August 2008)
"Total bankcard debt per bankcard borrower" is $5,710. This was alternatively described as the total balance of bank-issued credit cards per consumer. (Source: TransUnion, December 2008)
I can't say which one is true, but take the average of these, and you get about $10,000.
www.creditcards.com/cr...
On Dec 25 09:12 AM Cynical Sam wrote:
> The average US household Credit Card balance is now at about $10,000?
> Bull! If that often repeated statistic is true, the long overdue
> correction is just starting. What's the Average Household Income?
> I think it's around $60K - they have $10K in high interest CC debt?
> Either hide the women & children & stuff your money in the
> mattress or quit repeating that rediculous stat. Do yourself &
> your readers a favor & investigate the source of the CC debt
> "legend".
On Dec 25 09:12 AM Cynical Sam wrote:
> The average US household Credit Card balance is now at about $10,000?
> Bull! If that often repeated statistic is true, the long overdue
> correction is just starting. What's the Average Household Income?
> I think it's around $60K - they have $10K in high interest CC debt?
> Either hide the women & children & stuff your money in the
> mattress or quit repeating that rediculous stat. Do yourself &
> your readers a favor & investigate the source of the CC debt
> "legend".