What goes up must go down. And we didn't know this allready? (neighborhood, buying)

[gtbguy]

Originally Posted by Howard Roark

When the average household has zero debt, the boom begins. But that's decades down the road.

Americans love credit, we'll NEVER see a zero debt society in America. Its much easier to charge something you want now, than it is to save to buy it later. You also need to remember we Americans have a "short" memory and therefore, expect we'll end up in another credit mess sometime in the future. We just don't learn......

[smokemaster]

My parents listen to Rick Ettleman on the radio. He's a financial planner; CFP. He always is encouraging people to keep a fairly good size mortgage on their home. I'm glad my folks didn't listen; neither did I. I like that other guy that broadcasts out of Texas. People call in and tell about their journey to be debt free. Kind of like a weight watcher's meeting or something. Don't recall his name; but I've heard he is becoming more popular. Maybe he'll be the next Paul Harvey.

[ArizonaBear]

Originally Posted by gtbguy

Americans love credit, we'll NEVER see a zero debt society in America. Its much easier to charge something you want now, than it is to save to buy it later. You also need to remember we Americans have a "short" memory and therefore, expect we'll end up in another credit mess sometime in the future. We just don't learn......

Yes and no. I do think that most Americans will be quite frugal for at least another generation (25 years) and a large 'minority' i.e. Baby Boomers/older gen Xers will remain that way for the rest of our days.

[twiggy]

Originally Posted by ArizonaBear

Yes and no. I do think that most Americans will be quite frugal for at least another generation (25 years) and a large 'minority' i.e. Baby Boomers/older gen Xers will remain that way for the rest of our days.

We can't be frugal and restart the economy. It's funny that people want this to end by not spending any money. lol Not buying on credit. What do we think Capitalism is?

Someone better start purchasing something........... The lesson to be learned is how are economy is really run and what it's really based on.

[SOON2BNSURPRISE]

I don't think we need to become enslaved by debt to get the economy moving again. Many that lived during the great depression did without consumer debt. I know people that still buy cars with cash. My dad still thinks it interesting that people find the need to go into debt for a car and if they do why they would carry that note for longer than 24 months. He always told us that if we can't afford to pay cash then we need to save until we could pay cash. I haven't always listened but I get the point.

I can't understand why someone would go into debt for anything other than a home, education, or car. I add the car because so many of us have a need for one to get back and forth to work. At the same time I have friend that is paying close to $800 a month on a truck payment and I see that as an unneeded waste of cash for something that they can not really afford at this time. I never understood the concept of trading in a car when we owe money on it. I have known plenty that have done that though. Buying a big screen, new computer, furniture with out cash and on time is something that I have never done or will ever do. The only way that this makes sense is when the interest is set at zero and you can pay that item off before any interest is due.

A friend mentioned a new concept to me today at work. He stated that in the future we may go back to owner financing when we buy or sell our homes. I had never heard of it other than when a family member purchases a home from another family member, particularly a parent or grand parent. Another co worker let us know that is how he purchased his home. He bought it from a former employer who held a note on the place. In his situation he was able to assume a 1st mortgage and his former employer held a note on the remainder. Funny thing with that situation was that this was an agreement between him and his old boss, nothing was written down and 7 years into the deal the former boss died and a third of my coworker’s mortgage disappeared. Lucky him.

[twiggy]

I agree it should be this way but in order for the turn around we will have to be willing to put a lot of people out of work first. Capitalism is buy and sell, think of all the advertisers and consumer products that would shut down. It would cripple us for a long time. Should we take the plunge? Sure, but will we, I doubt it. It would be the biggest disaster since the great depression, I don't think any political leader would knowingly push America into that direction.. It would be devastating and change the country as a whole. It would include everyone and everything.
Our government is based on this system, it too is in dept up to it's eyeballs. It would take a revolution and starvation to get it to frugal and independent of credit. We would have to give away that free land again. he he

[algia]

I was raised to not have any debt, debt was viewed as a flaw, I can still hear my dad saying "don't ever have any debt or borrow money from ppl"....and he was right..why would you want to have something that's not "really" yours, ALL yours? I don't like to buy something and then be stuck paying for it forever and also with interest so that whatever I bought becomes even more expensive! makes no sense!

I mean, I could pay $40 for a pair of shoes and they are all mine today, OR the other option is to buy a pair of shoes that costs $40 but end up paying $80 or more depending on how much you drag the payments! how can that make anyone happy? as I see it, it makes ppl broke because of all these payments and interest etc! and you end up paying $80 for a $40 pair of shoes!!!! you could have bought two pairs with that money.

My dad still thinks it interesting that people find the need to go into debt for a car

my mom saved up and paid for her cars cash...I sold some property and bought mine cash too, car payments scare me...mostly because if something happens they'll repo my car.....who would want to live with that fear?

I can understand borrowing for education, a home (with common sense, now what happened here)......larger items, but everything else is just silly! not to mention that this "credit" thing bleed into basic utilities which is just horrible, if someone doesn't pay...electricity is shut off, period, same for gas, water, phone etc...but don't suck up "deposit money" when my credit is 750!

Originally Posted by gtbguy

Americans love credit, we'll NEVER see a zero debt society in America. Its much easier to charge something you want now, than it is to save to buy it later. You also need to remember we Americans have a "short" memory and therefore, expect we'll end up in another credit mess sometime in the future. We just don't learn......

[algia]

I highly disagree with this....because Germany is very capitalist too but ppl there are nowhere near buried in debt like ppl are here....and no one had to close any stores......same in Spain, Italy and most of Europe....they do have "credit" available but the culture there is not to use it, or abuse it like it is here. People there KNOW that the store will be there tomorrow too...Honestly, my biggest culture shock here was that Friday shopping after Thanksgiving, I never realized that ppl like to sit in front of a store at 4AM and then have to step all over each other to go to a store! that to me is the weirdest thing in the world....The only time I knew of ppl being at the store at 4am was in communism where the food was rationed. But for stuff that will be there tomorrow too, I am very sorry I will never understand it, not to mention that these days you can find all that half the price online.


Actually, they are capitalists but did not kill the mom and pop shops.....

Originally Posted by twiggy

I agree it should be this way but in order for the turn around we will have to be willing to put a lot of people out of work first. Capitalism is buy and sell, think of all the advertisers and consumer products that would shut down. It would cripple us for a long time. Should we take the plunge? Sure, but will we, I doubt it. It would be the biggest disaster since the great depression, I don't think any political leader would knowingly push America into that direction.. It would be devastating and change the country as a whole. It would include everyone and everything.
Our government is based on this system, it too is in dept up to it's eyeballs. It would take a revolution and starvation to get it to frugal and independent of credit. We would have to give away that free land again. he he

[OnYourSide]

Originally Posted by SOON2BNSURPRISE

[color=black][font=Verdana]I don't think we need to become enslaved by debt to get the economy moving again. ...

That's a really good point. I'm concerned about the long-term stability of things when the government is taking on so much debt in the name of it's citizens. We need to dramatically increase production.

[gtbguy]

Originally Posted by algia

I can understand borrowing for education, a home (with common sense, now what happened here)......larger items, but everything else is just silly! not to mention that this "credit" thing bleed into basic utilities which is just horrible, if someone doesn't pay...electricity is shut off, period, same for gas, water, phone etc...but don't suck up "deposit money" when my credit is 750!

I think credit is a good thing when used sensibly and sparingly. When young people are staring out you have to get in debt to make more money (like borrowing money for a house, land, etc.) for one's future. If credit is used correctly a person over a 30-year career can build a nice nest egg for his/her retirement.

The big problem I see is the amount of people trying to "keep up with the Jonses". Too many people get in debt up their eyeballs by buying cars and homes that are way above their financial means. This is the wrong way to use credit. And then we can't forget about GREED, that is what has killed the economy. I'm sure you all know the guy that makes $100K a year and acts like he makes $700K. This is the guy that keeps buying and getting deeper in debt just to show everybody his latest toy, house, etc. Kinda stupid but its happening....well maybe not now so much these days.