All A State Of Mind
Mass layoffs, bank failures, rising unemployment: the Great-Panic of 2009. This may very well be the end of the world, or so we’re being led to believe.
With each proceeding day comes another round of wrenching economic news. Along with 24/7 coverage of every job loss, every foreclosure, and every Wall Street banker now wearing threadbare Armani, it’s almost as though the pseudo-psychological beat-down can’t be escaped – not on a plane, not in a train. And with a souring economy and consumer confidence at historic lows, the most recent Discover Spending Monitor reported that nearly 30 percent of consumers are planning to further decrease their household spending.
It’s gotten to a point where it appears all industries seem vulnerable, not even Valentine’s Day was safe, with many weary consumers opting out of spending $100 for a dozen roses.
But need it be so? Should we be so quick to stiff loved ones of their much deserved dozen roses – priced appropriately for our nation’s favorite Hallmark holiday?
Yes the unemployment rate is at 7.6 percent and rising, but should we not consider the inflationary effect of the 16yr-19yr old labor force demographic which has an unemployment rate of 20.8 percent? Should those with a college degree not consider the 3.8 percent unemployment rate among their peer group before joining the frenzied masses?
Times are indeed difficult but optimism will prove to be a virtue.
Such a positive state of mind was summed up best by a recent radio interview discussing one man’s decision to spend money on Valentine’s Day:
Interviewer:
“Sir why have you chosen to spend money on flowers during such tough economic times?”
Man:
“I’m fine; I’ve chosen not to participate in the recession!”
Staunch optimism as economic philosophy; maybe we should all follow suite and chose not to participate!
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Comments
Comment from Anonymous on February 18, 2009 at 1:11PM EST
I agree with the man. If everyone cuts back altogether, even if they do not have to, but out of fear...nothing will improve. Buy that pair of shoes you want ladies. My family has cut back, but only by means of not taking on new loans.
Comment from TX Debt Atty on February 19, 2009 at 11:43AM EST
Or maybe we should prepare for the worst . . . which thinking could have saved inumerable families from facing foreclosure and eviction. Economic over-optimism was a key factor in creating the current financial problem, and further promoting of such ideas is sheerly irresponsible.
Comment from Captain Compliance on February 19, 2009 at 6:03PM EST
I don't know that its good to go to either extreme...neither spending like there's no tomorrow nor squirreling every penny away like a miser is good. The idea is to live well but within your means. It's fine to treat yourself and do nice things if it doesnt take you deeper and deeper into debt to do it. Every day we all see thousands of files on people with 20, 30, 50 thousand dollars in credit card debt - that is absolutely INSANE. Even worse, someone convinces them that their only way out is to borrow against the equity of their home, which they do...and lo and behold in no time at all they run the cards back up again and now they have a 50K 2nd mortgate PLUS 50K in plastic debt. Most of them won't live long enough to ever dig out of that bottomless hole. It's a recipie for disaster regardless of whether we're talking recession, depression, or booming economy!
Comment from Anonymous on February 20, 2009 at 11:46AM EST
$100 for flowers? Have you not figured out yet our consumption driven society is what got us into this mess. Take your $100 and give it to a charity.
Comment from Anonymous on February 20, 2009 at 11:54AM EST
Exactly captain compliance. Live within your means. Its living above your means that got this country into this mess.
Comment from TL on February 20, 2009 at 6:00PM EST
While the media breeds panic it has brought about pro's and con's.
First of all, live within your means.
I was guilty in my youth of spend now pay later... and I am still paying now. I have an excellent credit rating but that does not mean much when your income goes to paying those old debts.
Try this. WANT VS. NEED
WANT- I really want that new Big Screen TV....i really do.
NEED- Do I really need that Big Screen TV.... NO
A Need as an example- I need to pay my mortgage and buy groceries.
I am older and wiser and have cut unnecessary spending..... but I am SAVING (and picked up a part time gig) and will pay CASH for that big screen by kick off of FOOTBALL season...... so I will STIMULATE THE ECONOMY but not go in to debt to do it.
Let the good times roll.
Comment from Anonymous on February 23, 2009 at 12:28PM EST
Let's be real. If we did not have the ability to go into debt.. this country would have NEVER become what it is today.
This Recession was caused by GREED - NOT DEBT. Greed of the Elite.
Hundreds of years ago the elite ruled the common man. 5% of the population had 100% of the wealth. Not much has changed.
Fix the MORTGAGE issue - STOP the DOWNWARD SPIRAL of the Economy and it will level.
Credit will return, business can borrower and hire and people can recover and spend and the recession will ease.
Until the New Administration figures out that spending $7B to wire Rural areas with DSL (just one of many idiotic deficit spending measures in the "stimulous") is better spent going toward the re finance of millions of mortgage close to foreclosure - or write off of toxic assest the ELITE created.. NOTHING is going to get better.
NOTHING!
Pave all the roads.. fill the world with wind turbins... create battery cars ... fix as many bridge to no where as you want.. IT WILL HAVE NO AFFECT on pulling us out of this recession.
ELIMINATE the ELITE - CAP THEIR EARNING POTENTIAL - FORCE BUSINESS to ACT Responsiblity for TAX CUTS or get none...
FIX THE MORTGAGE ISSUE and you STOP the RECESSION.
That F'ing simple yet apparently TOO hard for this BABY administration to comprehend.
Bring Back Bill Clinton!
Comment from Anonymous on February 23, 2009 at 3:07PM EST
*Shortly after class, an economics student approaches his economics professor and says,"I don't understand this stimulus bill. Can you explain it to me?" The professor replied, "I don't have any time to explain it at my office, but if you come over to my house on Saturday and help me with my weekend project, I'll be glad to explain it to you." The student agreed.*
*At the agreed-upon time, the student showed up at the professor's house. The professor stated that the weekend project involved his backyard pool.*
*They both went out back to the pool, and the professor handed the student a bucket. Demonstrating with his own bucket, the professor said, "First, go over to the deep end, and fill your bucket with as much water as you can." The student did as he was instructed.*
*The professor then continued, "Follow me over to the shallow end, and then dump all the water from your bucket into it." The student was naturally confused, but did as he was told.*
*The professor then explained they were going to do this many more times, and began walking back to the deep end of the pool. The confused student asked, "Excuse me, but why are we doing this?"*
*The professor matter-of-factly stated that he was trying to make the shallow end much deeper. The student didn't think the economics professor was serious, but figured that he would find out the real story soon enough.*
*However, after the 6th trip between the shallow end and the deep end, the student began to become worried that his economics professor had gone mad. The student finally replied, "All we're doing is wasting valuable time and effort on unproductive pursuits. Even worse, when this process is all over, everything will be at the same level it was before, so all you'll really have accomplished is the destruction of what could have been truly productive action!"*
*The professor put down his bucket and replied with a smile, "Congratulations. You now understand the stimulus bill."*