Don’t Call it a Recession
So the Fed cut interest rates yesterday. I won’t pretend to understand the inner workings of the economy, but here’s what bugs me:
Everyone keeps talking about it.
I’m convinced that the more that people say things like “we’re headed toward a recession” or even just ask the question “are we headed to the recession?” that we move closer and closer to it. It becomes a self-fulfilling prophecy.
I’d like to give the American Public the benefit of the doubt, but the pundits in the media are being pretty irresponsible in the way that they throw around the word “recession.” The public tends to listen pretty intently to the media (even though they really don’t have any reason to trust them).
There’s no doubt that the crash of the sub-prime mortgage market has had an effect on the economy, but there’s fiscal irresponsibility going on all across the US. I was listening to some woman talk the other day about how she’d racked up thousands of dollars in credit card debt BUYING CHRISTMAS GIFTS.
Here’s my free tip for the day:
Don’t charge Christmas gifts. If you don’t have the money, don’t spend it. I didn’t realize that it needed to be said, but people use credit cards way to liberally. As great as they can be, they aren’t YOUR money. You have to pay it back. I’m not saying credit cards have no place. But, if you have outstanding debt already, you might want to think about paying it off before you rush to get more plastic.
Maybe I’m crazy. I thought this information was common sense.
5 Comments to “Don’t Call it a Recession”
Brian
It would seem to be common sense, but you know the majority of Americans have more consumer debt than ever before. I know it started in college for me, and it took a while to pull myself out of it. Even now, I still have to be careful to not spend money we don’t have, which is why I’m working hard on my resolution to get better organized and better budgeted.
As for buying Christmas gifts, we went a long way toward cutting back there by arranging a $50 limit gift exchange with my wife’s family. This year, I hope to start putting money aside from each paycheck starting NOW, so that we can afford the gifts up front, rather than floating a bit into the following month.
The Mvelopes program sounds intriguing and I may start using it soon. Plus, their website has a lot of free resources on budgeting that I am finding useful for planning.
- 8:20 am on 01 23, 2008
travis
Your free tip of the day reminds me of the SNL skit with steve martin, don’t buy stuff you can’t afford:
http://danwho.net/mp/index.php?id=snl_dontbuystuff
- 10:17 am on 01 23, 2008
Brett
Can i charge my portion of the cow on your credit card? Just kidding, credit cards are extremely dangerous, it still baffles me that we don’t require some sort of money or budgeting class in our schools. We require kids to take an hour of P.E. where they learn how to play pickleball(great game by the way) but we don’t teach them how to be smart about money.
- 8:07 pm on 01 23, 2008
Shane
I still think that Personal Finance with Linda Debarthe was one of the most useful classes that I took at Graceland.
- 8:13 pm on 01 23, 2008
G2
After the great crash of 1929 the government needed something to call the event that didn’t seem very negative, so the term “depression” was coined instead of the old term “Panic” I can’t remember when recession was first used, but it’s it was sure to have made george orwell proud!
- 9:09 pm on 01 23, 2008
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