All Posts Tagged With: "recession"

With the economy faltering, more Americans are paring down their spending. At the least, Americans are starting to buy only what they can afford. Could the next few years become the age of Americans saying good bye to credit cards and living within our means? And if so, is life without consumer credit a fiscal utopia?

Consumer credit is like a passionate romance that sizzles, and then fizzles. Consumers are lured to the relationship with large credit lines and promises of being able to “afford” life’s luxuries, today. For a while, life is grand. Borrowers have no need for a budget, as minimum payments are low and credit lines are always available for unexpected expenses or if ends don’t meet, as they inevitably won’t. Consumers are enamored with their credit, and creditors love their consumers, unwittingly racking up balances that will make creditors a fortune.

Sooner or later, the honeymoon ends. Borrowers max out their credit lines and minimum payments are not so minimal anymore. Life gets tough, and consumers begin to resent the credit they so recently embraced. Continued

The markets are seesawing, the big banks are panicking, and W. is throwing U.S. taxpayers a $300 - $1,200 bone. At my age (27 as of next week), I couldn’t be happier. Continued