The Economy...How Did We Get Here and What Do We Do Now?

[KouponKing]

Economics was not my best subject in school, I have a basic understanding of it but I don't really understand how economically, we got to where we are. How did it start? Was it when we switched from the gold standard to fiat currency or was it simply too much debt?

When I was a kid, debt was frowned upon. The only time you went into debt, was to buy a house, or a new car. Not ever for a used car. If you didn't have the money, you didn't buy the car, you didn't go out to eat, you didn't do anything. Credit was hard to get, and it was a form of leverage that was taken seriously. And not paying back your debts was taboo. In the 80's I noticed credit opening up to the masses. Credit cards took hold, and debt became more commonplace. And I wonder is that the beginning of the downfall of our economy?

Or was it the stock market? It seems to me that there are really two philosophies of investing. (Long term investing and playing the market), I think too many people are playing the market as opposed to investing. Their more conserned with syphoning money out of the market, than in being patient and waiting for dividends.

I'm sure there is much more to it than what I've just mentioned. So, what do you think? :confused:

[bugspost]

Our society got into a 'gotta have it now' attitude.
And businesses encouraged it. I remember when I was a kid, you saved money to buy stuff.
You did not buy it if you didn't have the money.
With banks and stores throwing credit at consumers, they showed how you could have it now. the 90 days same as cash got consumers because many would believe they would have the money in 90 days but you never know what may occur such as car breaking down. Then, consumers got stuck w/outrageous interest rates.
Also, I remember homes were not available for you to purchase unless you had 20% down so many rented and saved up their money until you had the down payment. Again, banks got creative and started handing out loans for the 20% down to put against the home. And many changed it to 10% or sometimes 0 down.

We really need to get back to living our lives within our means.
I think you appreciate stuff more if you have to save and wait before you buy it. I understand a necessity like refrigerator or car repairs, etc...that you may have to put on credit if you can't afford it. But paying off that debt should be high priority not just paying the minimum amount when you can afford more.

I am guilty of buying whatever I want.......but now I am going back to the basics. If I don't have the money.........I wait until I do. :)

[we3kings]

I think that because of technologies such as the Internet and cell phones and things like that, people have become accustomed to "instant gratification". Everything is so fast now. People are being "programed" not to wait. There is no patience anymore. Just the way people drive is a good example. No courtesy, no time, hurry, hurry. We can't even spell our words out now, everything is abbreviated. "I need it now!" mentality.

My parents always paid for everything with cash. If they couldn't afford it they didn't buy it. I have tried to follow suit and do things the "right way", it felt morally good to do it. Now I have begun to question if I've done it the "right way". I see everyone who's done it the "wrong way" being rewarded.

It makes you wonder if things will go back to the old way of thinking again.

[bunny]

I think it is because people feel the need to put on the show that they are rich and have to have the new cars every 2 years and had to have that great big house that was beyond there means to begin with . people don't save for anything anymore they want a new kitchen they charge it anything they want goes on a piece of plastic. The loaners of money see this and were handing out loans that were much to big for the people receiving them . Well now the lending has come to a halt balloon payments are due and people are broke. The housing market is just in sane. people want there house to have more equity so they can borrow more against it. I have to tell you I don't want my assessment raised , I don't want to sell or remortgage of to have my taxes go up because of it. when ever people get a lump of money they don't pay things off they put a down payment on something else they can't afford. When we ASSUME we will have the overtime until we can pay that car off it is bad news.

[ALawicki]

I agree with all of you. People think that just because you can finance something they should get whatever they want. They think, oh I can pay it later, so why does it matter if it is really expensive. I have always been taught to save my money and always have. Now that it is so hard to get by, all that saved money is gone from having to buy things we needed (I mean really needed, food and such) and I never can catch up now. When companies make is so easy to just finance stuff, people will do it with everyone. Money isn't going where it should and it probably won't.:rolleyes: