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Why is America living beyond its means?

Discussion in 'News' started by Dawood, Aug 2, 2005.

  1. Dawood

    Dawood Elite Member

    Joined: May 8, 2002 Messages: 4,677 Likes Received: 146
    I thought this would generate an interesting discussion....

    Economists are furrowing their brows, scratching their heads and asking each other, Is the US deficit growing too large? Is the US dollar plunging too fast? Will the Chinese keep buying our bonds?



    Meanwhile, the mainstream media is growing alarmed. A recent Newsweek cover-story outlined the very real potential of an economic collapse and dimly added that "if you think that some economist – or even Alan Greenspan – has a realistic solution, think again.” The New York Times ran an editorial criticizing President Bush’s “tax-cut-and-weak-dollar deficit-bloating ploys.” It warned that the US economy is precariously close to a meltdown.



    On the other side, a number of economists are pooh-poohing the danger of a crash. David Levey and Stuart Brown insisted in Foreign Affairs that US economic hegemony is “solidly grounded” and the country’s financial stability is not under threat. Prominent former Salomon Brothers economist Henry Kaufman has also downplayed fears, confidently assuring the New York Times that “We have an economy that is performing far, far better than the other industrialized countries.”



    But amid all this pro and con analysis, no one has yet asked the most obvious, common sense question of them all: Why are Americans living beyond their means in the first place? Why are residents of one of the richest countries on Earth spending hundreds of billions of dollars a year more than they earn? And then there's the obvious follow-up question: Why is the rest of the world subsidizing America's $420-billion a year military machine?
     
  2. SF1

    SF1 Elite Member

    Joined: Apr 25, 2003 Messages: 4,866 Likes Received: 5
    I'm not. Are you?
     
  3. Dawood

    Dawood Elite Member

    Joined: May 8, 2002 Messages: 4,677 Likes Received: 146
    Me, personally, I dont own a television or a credit card, I have a paid for 94 work truck and a 96 mini van for my wife.
    I dont spend what I dont have, Most of the writers I know are like that because not many of us buy into the whole American picket fence thing, but are you saying that Americans in general are not in Hock up to their necks? Because if you are , you need to go check the figures again.
    And just in case you werent paying attention , credit is HUGE in america. And the average American is mega charge happy.
    Am I wrong? You just like to argue with me dont you? ha ha!
     
  4. KaBar2

    KaBar2 Senior Member

    Joined: Jun 27, 2003 Messages: 2,125 Likes Received: 64
    Dawood, this is a subject upon which you and I seem to agree. I am very concerned about the extremely foolish practice of mailing credit cards to anybody and everybody. It's actually just an attempt to snare the foolish and the unwary into a web of debt. CONSUMER DEBT is the worst possible kind. Credit cards have high interest rates, and even if they start out at a more reasonable rate, if the cardholder is the slightest bit late with a payment, they jump the APR up to a much higher rate, sometimes as high as 24% interest.

    I think people should not go into debt except for the most serious of reasons. Every person should have an emergency fund of three to six months' living expenses. Priorities go like this:

    Food.
    Shelter.
    Electric bill.
    Transportation to WORK. (Bicycle, bus, motorcycle, USED car.)
    Emergency Fund savings account (3-6 months expenses)
    Investment accounts
    Retirement account
    Kid's college account
    Saving for down payment on your own home.

    Most people aren't saving a cent. They spend every dime they make on unnecessary bullshit that will not make them happy.

    I can think of a number of excellent principles to live by, whether one is an individual or a company, or a government.

    1.) LIVE WITHIN YOUR MEANS.
    2.) Start saving and investing with the VERY FIRST PAYCHECK YOU EVER EARN. Don't ever stop.
    3.) Never quit a job until you have another job secured.
    4.) If the economic situation you are in requires more money than you have, GET A SECOND JOB.
    5.) Never accept a credit card from any company, no matter what.
    6.) If you must use a card, use a DEBIT CARD.
    7.) PAY CASH FOR WHAT YOU BUY. If you don't have the cash, you can't afford it, so don't buy it.
    8.) Do not pass debt on to the next generation.
     
  5. RumPuncher

    RumPuncher Elite Member

    Joined: Jul 4, 2005 Messages: 4,500 Likes Received: 5
    9.) dont be a drunk or a slave to your vices.
     
  6. !@#$%

    !@#$% Moderator Crew

    Joined: Oct 1, 2002 Messages: 18,517 Likes Received: 621
    the consumer, throwaway culture of america is insidious

    affecting and contagious, it threatens everyone's well being
    a selfishness and sense of entitlement that seems to have arisen out of our very prosperity, i can only blame it on our obsession with money, status, and power

    while i don't feel like i subscribe to these ideals, it seems most americans do
    dooming ourselves with the gas guzzling, polluting SUV, impractical and obtrusive, it is a perfect symbol of the problem in the states

    why don't people care about our plunge into debt
    buying every thing we don't need
    proabbly made in a far away land by poor we help enslave, polluting by it's production, then by it's existence amd finally it's disposal

    i watched 'the corporation' the other night
    wow
    that shit is very scary
    the corporation, with all it's rights as an 'individual'
    is taking over while we all sleep
     
  7. angelofdeath

    angelofdeath Elite Member

    Joined: Sep 15, 2002 Messages: 4,375 Likes Received: 79
    i agree with kabars points. while im guilty of buying a crap load of cd's books and the like, im mostly considered the most cheap-ass bastard around by people who know me.
    i do use credit cards. i think there is some good in them. if anything for an insurance policy, knowing that you will have that backup if you fall on hard times and need that car repair or what have you. the one of 2 that i have has a super low rate, with no annual fees. i usually charge all my gas, groceries etc etc on that card, then write one check at the end of the month. while i dont follow kabars principles exactly on this, the logic is the same. i only use it as a convience. i dont rack up 30,000 in debt, then start crying. i pay every bill off, completely every month. i havent been charged any interest yet. i guess they hate me.
    i dont trust debit cards for some reason. perhaps its because my girlfriend uses her's all the time, and generally once every couple months, some one fucks up somewhere, and she is missing money in her account, after a series of aggravating phone calls, she gets it cleared up.

    i max out my roth IRA's every year and save every spare penny. i think the 2 biggest areas one can save and be heads and tails better than most, is buying a USED car, not a new car, eating in, not at the outback everynight. one person can survive on 50$ a week in food, give or take, depending on your eating habits. that MIGHT cover one meal for you and your girl/wife/guy/husband at a resturaunt.

    I do have some expensive things. however, those things that i buy that are expensive ATLEAST hold thier value or go up. things like my custom made flintlock for example, paid 2000$ for it, before the maker had a name. i could EASILY sell this for 5000$ just 3 years later. same goes for my guitars etc etc. the worst thing you could do is waste all that money on a new car. that 20,000 car turns into over 30,000 after you get done paying for it, and tags, title. if you drop 2000$ on a used honda for example, do preventive maintenance, take care of it, you will be saving tens of thousands of dollars in the long run, and the car will run forever. (unless the rear end RUSTS off...)
     
  8. SF1

    SF1 Elite Member

    Joined: Apr 25, 2003 Messages: 4,866 Likes Received: 5

    I agree. I'm just a cheap bastard myself. I've never had a credit card or even a MAC card cause I refuse to for the same reasons Kabar was talking about. I do at least have a TV though, I aint tryin to live like a monk. :haha:
     
  9. SF1

    SF1 Elite Member

    Joined: Apr 25, 2003 Messages: 4,866 Likes Received: 5

    :haha: :haha: I had a 82 Toyota years ago that the rear end (where the trunk closes) was litterally rusting off, I duct-taped the son of a bitch to keep the water out and spray painted all the rust spots with rusto. :haha:
    That car ran like a champ too. RIP.
     
  10. Dawood

    Dawood Elite Member

    Joined: May 8, 2002 Messages: 4,677 Likes Received: 146
    I had an 89 Honda Accord that looked like it was through a war. plus I used It for my sign business. I paint storefronts and I used to use the closed trunk as a table. LOL I got apint all over it. After awhile I just started writing on it and testing out paint on it...I got a picture of it somewhere ...I gotta find it...

    SF...Monks dont have computers.....and TV's stupify you and make your kids hyperactive and fat. In my humble opinion
     
  11. SF1

    SF1 Elite Member

    Joined: Apr 25, 2003 Messages: 4,866 Likes Received: 5

    I can't argue with the stupifying part, but kids are naturally Hyper. If anything the TV keeps them on the couch. That's how they get fat. :yuck:
     
  12. Dawood

    Dawood Elite Member

    Joined: May 8, 2002 Messages: 4,677 Likes Received: 146
    exactly, fat ass ren and stimpy greasy chip finger, red fruit punch lip havin ed, ed, and Eddie lookalikes....Kids without TV are much more eloquent, better mannered and generally have a better disposition than kids who sit in front of the tell-a-lie-vision all day.
     
  13. SF1

    SF1 Elite Member

    Joined: Apr 25, 2003 Messages: 4,866 Likes Received: 5

    I don't know, that sounds like a stereotype. I remember this kid shawn when I was a kid didn't have a TV cause his fam was mad broke. This kid was a HELL-RAISER!!! I tagged along with him while he robbed houses (for cigarettes and whatever money was lying around), beat kids up at random and other random nonscence. Shit, me him and this other cat Ian even had a b-b-gun fight in my house resulting in my dads bong accidentally getting merked (that was an ASS-WOOPIN!!!). This was all when we were 8 or 9. I credit him with me never picking up smoking though cause he tried to get me into that shit and (being so young...8) I was like "cough...cough... WHAT THE FUCK IS THAT!?!? PEOPLE PAY MONEY TO GET HOOKED ON THIS SHIT??? cough...cough). :yuck: :sick:
     
  14. KaBar2

    KaBar2 Senior Member

    Joined: Jun 27, 2003 Messages: 2,125 Likes Received: 64
    You need not have a super great job to be a successful investor. Online, there are many "investment calculators", and you can use them for free to see what will happen to your investments in the future. If you are young, and not making a lot of money, and you can only afford, say, fifty bucks a week EVERY WEEK to invest, what would the outcome be?

    (To put this in perspective, in 1975, when I was 25 years old and had a shitty job as a bill poster for a billboard company making $3.85 an hour, my weekly "budget" for alcohol and grass was $40 a week. WHAT AN IDIOT I WAS. I was drinking up and smoking up nearly 25% of my income.)

    $50 per week, invested at 6% return:

    1st year---$2,678

    2nd year--$5,521

    3rd year---$8,541

    50th year--$826,562

    This assumes that you won't ever get a better job, and that you won't ever be able to invest more than $50 a week. Obviously, this is not the case. So at some point, you might be able to invest $200 a week, OR MORE, especially if you are debt free.

    LIVE FRUGALLY. WORK TO CREATE A FUTURE FOR YOURSELF AND YOUR FAMILY.

    Guys, I know LOTS of tramps that could EASILY invest $100 a week. Every week. If they didn't drink/drug it up.
     
  15. RumPuncher

    RumPuncher Elite Member

    Joined: Jul 4, 2005 Messages: 4,500 Likes Received: 5

    see my point number 9.
     
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