***Strong views and possibly language may appear in this post. Be advised***
I caught someone saying something on the weekend news shows that almost made me spit out my Sugar Crisps. I wish I was paying attention to which show or which economist. As I recall, he was one of these Nobel economists. Anyway, this is what struck me.
He said that when individuals choose to save instead of spend, this is good for the individual. When a lot of people do it, it becomes trouble for the economy. When everybody in the country is doing it, we have a serious problem.
Now, I’m no Nobel laureate, but let me try to express my concern in such a way that takes into account his standing. What the hell is this guy thinking? When people act, it is bad for the economy? Without people, what f**king use is the economy?
Let me try to offer a different take on this.
When a family saves money instead of spending when not needed, this is good for the family, and good for the economy because the people are in a stronger place.
When a lot of families save money instead of needlessly spending, this is good for each of the families, all of the families, and for the economy because more people have figured it out.
When the country is saving money, this is great for everybody because the people are building real worth, real wealth, and not relying on themselves. The economy is strong because it is no longer based on phantom wealth (credit) to survive.
When people say they have X amount of wealth, but really have that amount of debt, this is bad for them and for the economy. This is what has been happening for decades. Sadly, this is the so-called “new” economic truth that many who teach the subject still believe.
Economy types will tell me that my view is backwards, that I’m selfish, and will ask me about the common good.
Right now, many in the media are upset because AIG employees are getting paid bonuses after the company took government money to stay afloat. The anger is that we taxpayers are footing the bill for the employees to get paid bonuses, and we cannot vote on this.
Where was the media when the decision to spend taxpayer money on a failing business was made? (crickets chirping)
We are coming to a crossroads.
On one path, we, as individuals, start focusing on ourselves. Saving money for things we want to buy, teaching our children to live within their means, treating a house as a place to live and make memories that are priceless rather than a place to make a quick buck. Further down that road, we start looking for ways to help those people who got a bad hand. We start thinking of ways to make the next generations better off than we were. We succeed.
On the other path, we forget that we have any value or importance as individuals at all. We forget how to think outside the hive. We forget how to thrive, and take what we are allowed to have by our caretakers. Further down that road, those who are in the very worst off are left behind because there simply isn’t anymore to give. The only silver lining is that we won’t have to worry about future generations because there won’t be any. We die off.
I know which road I’m going down.
Banks are places to put my money for safety. I expect them to lend my money to people who can repay that money with interest. Some of that interest should pay for salaries and buildings. Some should go back to me, as a fee for allowing my money to be lent out.
Houses are places to live. I will buy a house in a neighborhood that I would feel comfortable in raising a family. When that house no longer fits my family, I will sell it to another family. If I’ve taken care of the house, I will get a little more than I paid for it. If not, I won’t.
Credit is a tool to help me make purchases that are larger than I can afford. These will be few and far between. Maybe a car, maybe a house. I’ll pay a reasonable rate of interest to the bank who lends me the money.
If I believe that a company is being well-run and managed, I might give some money to that company to get bigger. I’ll take ownership of a small investment. If the company continues to do well or improves, I’ll get a little more money back for my investment.
Do you see a pattern here? I believe that many people will follow me down this path. Those who choose to go down the other path, I’m sorry for. We’ll meet again, and we’ll help you to work for your own success.
But right now? Right now I’m tired of hearing economic types and “experts” tell me how saving and self-reliance is a bad thing. I’m even more tired of trying to convince them otherwise. Screw it. You want to throw it all away? Go for it, but don’t expect me to jump in with you.