drevno

Do You Believe Borrowing Leads to Prosperity? (Part 2)

It's not only cars that represent the illusionary wealth or status (even though some people can and should genuinely afford it). It is also the house, a much bigger expense and cost. Hence it is not only driving an expensive SUV by a single person to the shopping mall, it is also living in a 3,000 sq.ft house that is essentially empty of people, and 20 or even 50 miles from a place of work, that seems such a waste of money and effort. And very likely financed by debt.

The list goes on and on - e.g. the garages so full of stuff that nobody has time to use...or a wardrobe so stocked and stacked that it is like a warehouse. All millstones around a consumer's neck.

Going into debt to pay for such excesses makes no sense indeed. And an economic recovery based on this presumption would be likely unsustainable and would likely lead back to where we are today - but without the Government's ability to bail out the failed ones again.

Black Credit Card Wars

Here's my 2-cent's worth:

1. The credit card is a great invention, but it should remain a convenience, not an easy way of getting into debt from which many just cannot seem to climb out. It is a great way of paying for goods and services without lugging cash or the cheque book. But it makes sense ONLY if the balance is paid of every month in full, or at least making substantial payments on the amount owed rather than carrying debt at usury rates.

2. I do like the idea of creating one's own black card with an appropriate picture of a dark night (romantic!) or a lump of coal (for the owners of the anthracite mines) or the picture of a certain portion of our financial system (the black hole).

After all, if one can get a good looking 'Rolex' watch for $10, why not pay with a good looking CC? After all, it is generally the cashiers in the restaurant or a hotel, whom the CC holders (of any card) are trying to impress...Or does such black CC comes out intermittently during the cocktail hour on one's own yacht or during a golf or a polo game?