The Economy's Not Bad, We Are

[MountainDon]

From Cal Thomas, syndicated columnist
http://calthomas.com/

If you believe big media, the economy is in trouble. If you worry about job layoffs and your inability to pay bills, you may be thinking about voting for Democrats this fall, which is the point of the negative media coverage. Every four years when a Republican is president, big media carry stories about economic gloom and doom. But is it true? It depends on the standard you use.

Last week, The Washington Post carried a story that is a metaphor for what ails us. It was about a Maryland couple whose mortgage lender took back what remained of a $95,000 home equity line of credit. The lender explained that the couple's home had fallen in value and it did not want to shoulder the risk that they might owe more than the house was worth. The couple was using the equity line to pay preschool tuition for their twins.

A good financial adviser might have helped them avoid this predicament, but we are immediately led to the supposedly bottomless well of the federal government. Politicians, especially Hillary Clinton and Barack Obama, pledge to shoulder the responsibility of making sure that people whose mortgages are higher than they can reasonably afford and whose debts are larger than they should be get bailed out by the rest of us who made right financial decisions and practice living within our means. I know, this sounds cold, but only to those who live this way.

Lenders across the country are pulling the plug on equity lines and tightening credit after a lending spree to people for whom the housing market was their pot of gold.

Much of this economic "pain" is self-inflicted. Rather than purchasing homes they could not afford — or putting too much down, making them cash poor — they might have invested their equity in balanced mutual funds (the Dow Jones Industrial Average rose 11.59 percent over a 10-year period). Such a path could have avoided the tight spot in which many now find themselves.

Some of the lust for bigger and better is human nature, but a lot is the result of consumerism. The Timex watch is no longer enough. We now must have a Rolex, though both accurately tell time. The adequate low-end automobile is insufficient. We must trade up to a luxury car with numbers and letters on the rear that mean nothing, but convey "status." And the house we are living in, which would have been more than adequate for our parents and certainly our grandparents, must be upgraded to larger digs in order to impress, if not growing families, than enlarged egos.

When none of this brings the promised happiness and fulfillment, we turn to drink, or pills, or counselors, or divorce court and seek significance in new things and relationships on what quickly becomes a personal boulevard of broken dreams.

We can't say we haven't been warned about this endless pursuit of stuff. The writer of Ecclesiastes wrote, "Whoever loves money never has money enough; whoever loves wealth is never satisfied with his income. ...As goods increase, so do those who consume them. And what benefit are they to the owner except to feast his eyes on them?" (Ecclesiastes 5:10-11)

When wants and needs are confused, desires become entitlements and politicians are afraid to tell people what they need to hear. Instead they tell them what they want to hear. Anger and envy result, as well as frustration with a political system that was not designed to indulge its citizens in their lusts or subsidize their greed.

Who will tell us that unending and expanding prosperity with home values constantly rising and a citizenry always able to afford them is a fantasy that is bound to end in heartache for those who buy into it?

The economy isn't bad. We are bad for believing that more is better and the most is best. We have an abundance of things, but a deficit of character. The economy is a false god, a golden calf. When this false god doesn't deliver, we complain to politicians who are happy to accept our faith in them to give us what we want — if we will only pledge to them our allegiance at election time.

So, IF you made it this far...

America needs a big attitude adjustment.   A democrat vote for president will continue bailing people out of their own stupidity and greed, and to continue feeding the masses false sense of entitlement, using tax dollars from people who have had the sense not to fall into those traps. A republican vote will continue spending money we don't have in a war.  There's got to be some other way....

[tanya]

Well I agree with the idea that people should live within their means but withthat being said.... I also think that govt. has an obligation to it's citizens to stop these predatory lending and banking practices by the coorporations.  Especially toward the elderly and youth in our country.  The elderly lived in a time when banks were adequately regulated.  The young don't realize that getting into debt early on can lead to a life of poverty.  We have had no education for HS students who are sent mailboxes full of credit card offers even before they ever hold a job.  Young families are targets of predatory lenders who get them into huge morgage debt and then tell them what a flexible interest rate means.  Then there are late fees, over balance fees, etc.  All a thte tune of $35 each.  No I agree with regulating corporate responsibility.  The Republican objective of trickel down economics has nearly bankrupt this country's middle class at least twice in my adult life and it would be helpful if the media would present that information more clearly.  When there is no middle class there is no longer a democracy.  The rich control the markets and the poor simply endeavor to survive. To have a strong country we must all work toward fair and balanced practices especially the corporations and financial institutions after all the bigger they are the harder they fall.  The economy is BAD and the current administrations policies favoring the corporations and financial institutions has played a BIG role in that.  One option I would like to see for struggling families and those who are about to lose thier homes is a longer contract with lower interest rates.  That would be a win win situation and would increase "buy in" accross the board. 

[ScottA]

Media is always doom and gloom in one form or another. You can not watch the evening news in this or any other year without seeing story after story of doom and misery. To say this is because it's an election year is just stupid. Think back to last year and the year before than. Yup more bad news. Historicly the working man has had a better time of it when a democrat was in the white house and the business man had a better time when a republican was. Both parties waste tax money, both parties lie about their real agendas. I will never be convinced that one is less evil than the other. America is having it's belt tightened right now but the powers that be. They do it ever so often so they can consolidate their power ever more. Every recession, depression we ever had was preceded by sudden lack of money to borrow. This time is no different. Sure they blame it on a few bad mortgages but they knew what they where doing when they lent the money in the first place. Who you elect in november will have no bearing on this situation.

[glenn kangiser]

Yup -- the choices you are offered are not meant to solve any of the problems you want solved.

No answers except total meltdown.

[StinkerBell]

This is the problem with society imo. It started when people decided that all children are winners and they all get trophy's even if they do not place first, because we do not want to hurt their feelings. These children are now adults and do not know how to cope.

Well, this is a piece of the problem imo. The rest of it is glenn's fault.

[glenn kangiser]

I been unlucky since I was 3... when I was a baby they kept pinning things on me.

Homer and Jethro

I have never had a trophy as a kid -- I got a couple in the last 10 or so years with my old cars because there was not much competition-- one peoples choice, I won even though there were great cars there that were much better.  Mine was only stock and I said it still had the original dirt.

You see, Stink -- I am a winner, even though I don't try to be.  I only win for the fun of winning.  I have no team spirit.

What's that do to your theory?

[StinkerBell]

Then by default I just blame you. 

[glenn kangiser]

There you go.  I just won again.

[peternap]

Don, there's a lot of truth in that but there is also a lot of generalization.

Today is a good day for me and I'll explain why. I fully expect a meltdown in the government. I was also wrong once. Because of that, I like to wear a belt, suspenders and have a piece of tarstring in my pocket just in case.

Because of the big dump in the market today, I finished my positions in the stock market that ...If I live 5 years and the government doesn't completely go away, I'll be very, very, rich. That's the suspenders.

I already had things organized to the point of being comfortable...that's the belt.

If good things happen and we have a meltdown, I've been set up for that for a long time and I'm really more prepared than ever. That's the tar string.

Yes...I own a Timex and it's the only watch I own. Believe it or not, I also have a pocket sundial.

I owe NO money!

My wife has a Landrover but I have a beatup pickup and a Focus (and a Whizzer) and two Bicycles.

After a lot of lecturing (and a little help) my kids now have stable mortgages at lower fixed rates than their old adjustable teaser rates. Neither owe credit cards now either.

The bottom line is ...we are all happy and prepared, no matter what happens.
We certainly not alone in this.

Tanya, expecting the Government to help anybody with anything is a pipe dream. God helps those that help themselves. The Government just makes things worse.

[MountainDon]

Peter, yep. There's never been anything wrong with being prepared. Triple over is even better. 

As for the government "should do this, should do that, to protect us".... only within reason. If you start expecting government to do "this and that" that soon leads to more and more government involvement, more regs, less freedom. Too many people are abdicating personal responsibility.

As for people (young, old, whatever) being suckered into something, a lot of that comes from the "it'll be someone else's fault. I'll blame the politicians or the big corporations". A lot of it also comes from greed, the "I want that TV now. I deserve that SUV now". Personally I've wanted a lot of things that I still don't have, because a lot of them are things I don't really need. So it really irks me to no end when government is called on to bail out the stupid, the inept, the greedy and the selfish. Credit is an excellent and a very important tool. Just as an improperly used circular saw can maim you, imprudent use of credit can maim you financially. Read the instructions. Read the rules.

Somehow I've always been able to understand that it's a bad deal to spend money when you don't have it.    How that happened I don't know. Maybe that makes it difficult for me to understand people who have "fallen into" consumer debt and owning houses twice as big as they need. I never remember anyone dragging me down to the store to look at plasma TV's. Sure, the ads are alluring, the financing glossed over by the staement of only $x.xx a month. But that's why God gave us all a brain. I was an early adopter of credit cards. I had a Visa card before they were called Visa. [FYI, they started out with the Chargex name.] My biggest complaint for years was that not enough merchants accepted the card.

OMMV

[Willy]

Don, there's a lot of truth in that but there is also a lot of generalization.

Today is a good day for me and I'll explain why. I fully expect a meltdown in the government. I was also wrong once. Because of that, I like to wear a belt, suspenders and have a piece of tarstring in my pocket just in case.

Because of the big dump in the market today, I finished my positions in the stock market that ...If I live 5 years and the government doesn't completely go away, I'll be very, very, rich. That's the suspenders.

I already had things organized to the point of being comfortable...that's the belt.

If good things happen and we have a meltdown, I've been set up for that for a long time and I'm really more prepared than ever. That's the tar string.

Yes...I own a Timex and it's the only watch I own. Believe it or not, I also have a pocket sundial.

I owe NO money!

My wife has a Landrover but I have a beatup pickup and a Focus (and a Whizzer) and two Bicycles.

After a lot of lecturing (and a little help) my kids now have stable mortgages at lower fixed rates than their old adjustable teaser rates. Neither owe credit cards now either.

The bottom line is ...we are all happy and prepared, no matter what happens.
We certainly not alone in this.

Tanya, expecting the Government to help anybody with anything is a pipe dream. God helps those that help themselves. The Government just makes things worse.

Things you say about not owing any money is sorta not true. You allways owe taxes unless you rent then you owe rent? My property taxes are $2500.00 a year and I owe that. You may also owe a phone bill, electric bill, medical insurance bill, car insurance bill, food bill, ect ect. Now saying that it is nice to own your own home free and clear which I do. It took me to the age of 42 to acomplish that!! I was in dept for my last home but sold it for more than I paid for it. I did that because I went into dept and bought the place knowing it would go up in value and was tired of paying rent. Being young, married, one child and self employed the money was not there to just pay cash for my first home. So borrowing allowed me to end up with my home now paid for. I also used credit cards and got a excelent credit rating over using it right. So now when I use a credit card, I use the "ZERO INTREST CARDS for a year "I get all the time tring to get me into dept. This way I use there money not mine to make more money with. I get paid around 3-4 times a year and it allows me to do it easier. I also pay off what I owe when I get the money. So it all depends on how much money you have and how long you want to live in a tent before you buy your first home with cash. Young people need to start somewhere and I garrentee you don't get your home and cars paid for with out working a long time having nothing  so you can save up the money to buy them with cash. In fact a home can increase in value faster than you can save like the one I bought on payments. So buying things on payments is also a way to get ahead if you do not inherit a ton of money first. Mark

[peternap]

Your right Mark. Taxes, utilities and other expenses are always there. I do have a little difficulty saying I OWE taxes though. I don't think I owe them...I just have to pay them...It's kind of like paying the mob protection money

Your also right about borrowed money working for you. I didn't make much use of it for one simple reason. After leaving the government, I've been self employed or employed by a corporation I owned the majority of. It has alway been difficult and sometimes, impossible to borrow money.

So I had to learn to play the game. I bought a block of slums in the city once. Paid 1500.00 each (that was a while back and yes, fifteen hundred). I had an idea the Redevelopment Authority was going to renovate the area. They bought them from me for 20,000.00 each. I had a sharp enough CPA who figured a way to roll the investment back into more real estate with very little tax exposure. I could borrow against the property, but as usual, I could only borrow, when I didn't need to.

Through all those years, I worked my butt off. As most self employed people here know, 80 hour and more weeks, aren't unusual. But the investments were just reinvested. Then came college for the kids, then weddings and all the time, we were able to pay them out of pocket.

Most of our investments now are solid. Tree farms and other real estate. The farms won't be sold in my lifetime although the timber may. The rest of the stable stuff is Tax exempt Muni Bonds and partially exempt muni management companies.

Several small businesses and this year, I've done very well in the stock market. I also have a lot of hard assets, gold, gems, silver from a silver extraction business I've owned for years. Tools,etc.

Most experts say no credit is worse than bad credit. I guess it's in the perception because it just tickles me pink to have no credit.

[MountainDon]

Things you say about not owing any money is sorta not true. You always owe taxes unless you rent then you owe rent? My property taxes are $2500.00 a year and I owe that. You may also owe a phone bill, electric bill, medical insurance bill, car insurance bill, food bill, ....

Good point Mark. There are a great many expenses we owe in daily life. Most anyone who is still on the topside of the grass has all those bills.

If I had made the remark that I owe no money, which to my mind, is true, I would have meant NO credit card debt other than the current billing period. No mortgage payments. No car loan payments. No other "revolving credit" debt of any type. That's what no debt means to me. My mind overlooks those, and the taxes, because they do get paid on time and I'm not left owing them for months on end as past due.

[benevolance]

America has consumed more than  it's share of the world's resources for over a hundred years...There has to be some sort of pendulum swing back towards balance...4% of the world's population using up 25% of the worlds resources...

All we do is consume full out all the time...The pattern holds true for gasoline, precious metals, copper steel food and money...

Nobody buys the car they need...They buy the car they want....Ditto when they shop for food or clothes or even a house. And we have been told all our lives that we need credit cards and we have to use them to get good credit....They are like drug pushers urging us to use crack and smiling when we get in over our heads and hooked knowing they can ride us like a pack mule all the way to their bank


We need to spend less and waste less as a society...and for America that means driving cheaper smaller cars with less power that give more mileage....It means eating at Ruby Tuesdays less and cooking at home more...It means making better decisions with appliances and saving energy...It means making smarter choices with clothing...Hunting for deals on the things we need...Accepting second hand goods..Learning how to fix things instead of throwing everything away for new items...Learning how to barter or working a second job...

There is this huge misconception that the good times will never end... that the future is secure because technology will provide us with all the answers to our energy food water and housing needs.

I wrote a paper on this a long time ago...and I believe it more today than when I was in College...Technology provides no  answers to our problems...Answers come when we take a good idea that uses common sense and logic and allow technology to help us towards that goal... But if the logic is bad technology will just keep us going on the road to hell.

Which is where we are all heading folks

[Homegrown Tomatoes]

Like Don said earlier, somehow it is hard for me to believe that the people who get into debt over their heads don't really know what they're doing.  Even from the time I was a little kid, I understood that I could not spend money I did not have.  When I was around 8, I knew some kids who weren't allowed to leave the area right in front of their house.   My cousin and I would rollerskate down to the local mom and pop grocery store and spend a few pennies on candy.  Then we'd go back and sell it to the neighbor kids at a few cents' profit so that we could afford to buy the candy we wanted for ourselves.  By the time I was sixteen, I saved and bought my mom a cedar chest for Mother's Day.  I paid 2/3 of it in cash, and the store owner extended me a line of credit to pay the rest off at ten dollars a week.  It wasn't exactly a credit card, but it taught me a lot about how they worked.  Thankfully, the store owner wasn't as greedy as most credit cards and didn't charge me much interest. 

Recently, some friends of ours in Wisconsin were looking for a house.  It would be their first house, and they were really anxious to move out of their tiny apartment.  Well, the husband had convinced himself that they could spend 40% of their gross income on housing (not including the cost of bills, maintainence, etc.) for said new house.  The wife was going crazy with worry that he was going to push them into bankruptcy, because she understood that just because you can get approved for a loan that big doesn't mean that you can afford it.  My husband and I jumped on the guy and practically beat him over the head with "What are you thinking???!!"  Thankfully, my husband sat down with him and showed him that he absolutely could not spend more than 1/4 of his income on a home loan because of all the added expenses of home ownership that he wasn't even thinking about.  Thankfully they ended up buying a foreclosure that was a nice enough house, but still within their means.

I think some people who are "deceived" into paying more than they can afford do so because of the lust of their eyes... they see it and want it, and what they can afford never comes into play.

[tanya]

"Tanya, expecting the Government to help anybody with anything is a pipe dream. God helps those that help themselves. The Government just makes things worse."

While that statement may be true, the government is not exempt form the citizenry's expectations.  The fact that the smokescreen continues to be that the lazy, inept etc. amongst us instead of the govt. regulations concerning the corporations that enjoy our dollars is one of the biggest problems we face in addressing this issue concerning our economy.  In fact if the govt. doesn't regulate the corporations, and the corporations continue to fail to regulate themselves, ( I know hahaha) there wont be an economy left to regulate.  Not only are people honest folks as well as the lazy, inept etc. sick and tired of being duped into buying and investing in corporations that continue to ship jobs and wealth of our citizens overseas, only to have it come back and bite us in the ass but the economy cannot take it. 

It doens't matter what  I think, or if the govt. gets off thier ass and does what needs done what matters is that the corporations have already sucked the middle class dry and if they don't get back on track and begin supporting that very same middle class with some policies that build insead of suck then they will be the ones that fail.  The bigger they are the harder they fall.   The govt. can only protect the corporations so much.  The middle class will survive, they might be poor but they will survive, it will be the corporates who sink regardless of the govt. involvement. 

So to say that expecting govt. to do somehting to regulate the corporations is not going to work, well that is probably true but in the end that is still thier JOBand what they collect taxes for.  Protecting our economy is as essential to our nation as is protecting anything else, maybe even more so. 

[Willy]

America has consumed more than  it's share of the world's resources for over a hundred years...There has to be some sort of pendulum swing back towards balance...4% of the world's population using up 25% of the worlds resources...

All we do is consume full out all the time...The pattern holds true for gasoline, precious metals, copper steel food and money...

Nobody buys the car they need...They buy the car they want....Ditto when they shop for food or clothes or even a house. And we have been told all our lives that we need credit cards and we have to use them to get good credit....They are like drug pushers urging us to use crack and smiling when we get in over our heads and hooked knowing they can ride us like a pack mule all the way to their bank



There is this huge misconception that the good times will never end... that the future is secure because technology will provide us with all the answers to our energy food water and housing needs.

I wrote a paper on this a long time ago...and I believe it more today than when I was in College...Technology provides no  answers to our problems...Answers come when we take a good idea that uses common sense and logic and allow technology to help us towards that goal... But if the logic is bad technology will just keep us going on the road to hell.

Which is where we are all heading folks

Wow I read this and the word "we" is used all the time? Are you saying your wasteing all this stuff and me too? You may be wasteing but I am not. The word "we" means all of America is doing this.
The nice part is this is America and we can have a nicer life if we work for it. Some countrys only a few have the nice life and the rest work for them to keep it that way! We also feed a lot of people in this world with what we grow and buy.

Quote "Nobody buys the car they need...They buy the car they want....Ditto when they shop for food or clothes or even a house. And we have been told all our lives that we need credit cards and we have to use them to get good credit....They are like drug pushers urging us to use crack and smiling when we get in over our heads and hooked knowing they can ride us like a pack mule all the way to their bank"

Both my vehicals are what I need not what I would like. One is a high MPG small 4X4 pick up for little loads ect that it can handle and may go to town once a week. The other one is a 1 ton 4X4 1973 Chevy Dulley used to haul hay, livestock and heavy supplys to our farm in the country a few times a year. You can think of my old perfect running truck is not in a junk yard and the country did not need to build another plastic messed up over priced new truck to replace it! As for cloths I don't own a suit or tie as I don't need one. I still buy jeans and work shirts cause fancy cloths don't work on the farm well. My home is 1,680 sq ft and it does not seem to be very large just enought rooms for my family to sleep and eat in. I heat with fire wood only so I am doing my part to not waste energy.
Now I sure don't want to live in a stacked cubical like they do in Japan and share it with someone who works a different shift. For a year I slept in a tent on a cot in Vietnam and that is all you realy need to live in to stay alive but I like a nice home free of bugs and safe from the rif/raft they may want to do my family or me harm while I sleep. I may eat at a restrant once or twice a year cause I have to but we raise most of our own food on our property. Guess I could not do this if you had your way I would live in a multi-level apartment with no land, riding the bus every where I go, wearing extra cloths so I can keep the heat down to 50 in the winter cause you can still stay alive at those temps if you dress right.
No I will work so I can have my truck I need and want, I will also work to keep my 40 acres of land that a 1,000 people could live on instead of me if you packed them in right. You should fly over the USA once and take a look down and you will see all kinds of land people don't even walk on yet. It is the crowded citys that need to be leveled to a normal living condition. This way when something happens millions won't die cause they can't drive out or get away from a disaster. I could go on about this even more but I won't. It gets me all wound up when people/goverment ect tell me how I need to live/buy/own ect cause I fought to keep America free and love this country. If your not happy with it and it would make you feel better there are other countrys that people live the way your talking and you could move there? PS if I want to build a little cabin in the toolies for something to do, to me this is not waste it is progress in my way of life I enjoy.
I just wrote this, I never went to college cause I could not afford it so I learned to work with my hands instead to make a living. Mark

[MountainDon]

Great comments Mark. I read the post referring to "we" and "nobody" earlier today. The over generalization that the "we" and "nobody" transmits aggravated me then and still does. That's way too broad a brush. Statements like that incline me to discount heavily whatever message the messenger is trying to deliver.

I didn't bother commenting this morning because there are times I just don't feel like  .

As for technology haters/disbelievers...  If it wasn't for technology we'd all still be suffering periodic epidemic die-offs due to pathogens in our water. We'd have our families decimated by plague every hundred years or so. We'd be burning coal and living in soot smeared cities. If we lived in the country we'd likely heat with wood, until we burned all the trees up. We'd be using candles for light and breathing their byproducts of combustion. And so on.

[benevolance]

mark

I feel you man...My wife and I drive old cars we buy for a couple hundred bucks...and we buy used furniture..We fix old appliances other people are throwing out...we make old things new again and we learn to have whatever we want for less money...

There are many hard working people out there that work for what they have and they do it without debt...But when I said we I was referring to America as a whole country....The facts do not lie...The average american is in a staggering amount of debt...the average american wastes a staggering amount....We throw so much away as a country...

that is what I was referring to