I hate stories like this.
The ones that say “Oh woe is us, shoppers this year are going to be oh so careful with their money! They’re not going to go into debt! They’re going to be responsible and frugal and reasonable and careful! Oh woe!!!”
Latest offender: (click here) which says people will actually, to avoid going into debt, be paying with cash. The horror!
Actually, it is, because not only won’t they be going into debt more to the banks, but they won’t be paying exchange fees to the banks for using their credit cards — that’s that tax that banks hit us with, one-to-five percent, for every purchase we make using a credit card.
See, this is what’s wrong with America: Our whole economy is geared to Americans being foolish with money, throwing the stuff around like potato chips as the Super Bowl, not caring a whit if we go into debt because it’s all about spending and consuming, so any switch to something different must be bad, right?
Banks and other financial institutions have business plans, and future economic plans, that are based on you and me managing our own personal finances like drunk teenagers with car keys. This makes their bottom lines look good and they don’t care how we end up.
So ignore. Pay cash. Be careful with your money. If you have to hand make your kids Christmas presents this year, I guarantee the kids will treasure them a lot longer than an iPod.
Yes, this does mean the economy will be slower coming back. It has to be. The past boom was built on false money, money that didn’t exist in the form of grossly inflated home values. That money will never come back, so the booming levels of the economy that it supported won’t be back either.
Get used to it. And save your money. Don’t spend what you don’t have. If you simply must spend a bundle at Christmas, cut back somewhere else. Cancel the cable or something. It will be worth it to give your kids that iPod they can’t live without, right?
Or, maybe, will let you pay the electric bill this month. Whatever, eventually, we may emerge from this recession a more frugal, economically sound America. We’ll only do that if we quit listening to news stories like this one.