Your general feeling is great, you have a job, you have a house, you have a car. You feel like treating yourself to something nice, after all, you deserve it. You go to the mall and you use your credit card to buy a couple of items you don’t really need, and will never use. No money exchanged hands. Your elation disappears by the time you get home, you’ve wasted some money.
You have already forgotten about the items you bought, but the bank and the credit card company have much longer memories. The monthly bill shows up. You pay minimum payment. Why pay more? You still have a job and a house and a car. But after a few years you start to choke. The credit card is consumed to the limit and the interest rate is not negligible anymore. Plus the minimum payment is growing…
You take a home equity loan. With which you pay the balance off the credit card, and buy a new car. You feel better, for ten minutes, then it’s back to the good old cycle: buy, pay minimum, choke, home equity.
Cycles, however, have weak links. One day you realize, your car and home are repossessed, you’re out of a job, and you owe tons of money. You’re a 2008 American.
You suddenly realize that you’ve been fooled. You’ve been fooled to waste your money and life away, mortgage your life, your health, your children’s education, in exchange for a few minutes of happiness, and a few billion dollars in someone else’s hands. You are screwed. You can’t waste more money, not because you don’t want to, but because you don’t have it, and they, the big bad credit card companies, can’t allow you to borrow anymore. They think you won’t be able to repay them. They are correct.
You realize further, that unfortunately, you’re not the only one. In fact, everyone was doing the same thing. Your conspicuous consumption caused retailers to up the prices, open more stores, hire more people, who in turn wasted their money just like you. The stock market boomed, supported by your irresponsible shopping. People were selling their houses, whose prices were inflated, to get more money to invest in the stock market.
It was a party. And like all parties, when everyone realize they are too drunk, too full, and that it’s too late – your party crashed too.
Everything around you is failing. Your friends are losing their jobs too, the banks are moving into your neighborhood. This time, they are not looking for new fools to take crazy mortgage loans. This time they are after the keys. Cars are being towed, the stores are either locked or empty.
It seems that America has put consumption on hold, from software and hardware, to clothes and toys. From cars to cosmetics, even food. The amount of money which evaporated in bad loans, stock values, real estate is guessed to be in the tens of trillions of American Dollars. Yes, your part was negligible, but there are three hundred million of you. And American determinism and perseverance is famous. When American do, the go all the way. America has consumed itself to the brink of bankruptcy.
Greed, irresponsibility, malice, psychology of consumerism. It’s time to pay.
Unfortunately, when it comes to payment, America is not alone. The whole world chips in. Children labor used to manufacture toys for American children are out of work. The entire Indian diamond industry is going back to their villages, because they are out of work. Millions of workers at $100.00 per month, working 16 hour days with no break are now unemployed. Countries are unable to pay their debt, individuals are becoming homeless and hopeless.
Will Obama be able to fix it? Will throwing money and bailing out industries work? Is this a resource question? Or is it an education and training question? Do we have to change our attitudes? Think about tomorrow? Save? Consume with responsibility? And will we ever realize that when something seems to be too good to be true, it definitely, absolutely, categorically is. Wake up, smell the coffee. We are experiencing a depression. Not a recession, depression. And it won’t be over any time soon. It’s here to stay, until we learn to use resources in a reasonable manner. And yes, that includes the environment.
Have a good day today. Make sure you remember that tomorrow is around the corner. If you have dependents, make sure that you give them a runway. If you absolutely need something, by all means, explore the options, buy it responsibly, and with money that you have. Understand that it’s a zero sum game. If you buy this, you won’t be able to buy that. Save. Save. Save. Don’t listen to salespeople offering you free lunches. You must understand by now: there are no free lunches, dinners, breakfasts. No free loans, no low interest, no interest free. There’s no “buy one get two”, “buy now pay later”. Be careful, be responsible.
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