Wednesday, November 26, 2008

Not Much Reason For Thanksgiving For Everyone

This upcoming holiday celebrates having plenty, and that just isn't the case for entirely too many of us. While some of us have family commitments, the call for help for the desperate is growing really strong. As losses of jobs and homes mount, we can't ignore basic need growing into a very common problem.

The food banks are feeding former contributors, and unemployment bernefits are under seige. This is a year for making a trip to the store for things to give to local charities, if you possibly can.

Still, we have the supply side telling us it's all about psychological stumbles. Too funny, to hear the WSJ Report every week insisting that we are refusing to spend all that money because we lack confidence, and the maladministration telling us we can go borrow now since the bank has been given all our money.

A great irony of contemporary capitalism is that what's good for the U.S. economy is bad for the individual. Americans should save, but the economy is dependent on spending. Personal consumption is 70 percent of our gross domestic product; the rest of the GDP consists of the government and the few people who managed to save and invest, only to lose 40 percent of it now.

Jonesing for new junk helped get us into the current economic crisis. Yet a new credit card campaign seduces shoppers to binge more: "We're a nation of consumers. And there's nothing wrong with that." Oh, yes, there is! The ad continues: "The trouble is there's so much cool stuff. It's easy to get carried away." To the poorhouse, especially with the company charging 11 percent to 19 percent interest, plus 24 percent on cash advances, rates a bookie could love.

This behavior may be changing, despite such seductions. "People feel that they should be conservative. It's the right thing to do even if, personally, they're not feeling the challenges," says consumer business expert Tara Weiner, managing partner of Deloitte's Philadelphia office.

"Part of the problem is emotional," TD Bank economist Joel Naroff says. "An awful lot of people are concerned, and they're scared. People who might be spending are not."
Consumers have lost confidence, plus they're bored, Mr. Hoch found in a recent study. "It's all the same stuff." We've lost the thrill. Mr. Naroff wonders "whether people can stay irrationally depressed for an extended period of time."

Does that just make you weep with regret that you are so emotionally in a bind? Me, neither. But I give the op-ed writer credit, she is telling her readers that shopping 'til you drop was never a good idea, and now is a good time to give it the pass it always deserved.

Spending money for the good of the Unreal Economy has become a lot harder and that may be good practice for getting what we really want eventually. Credit is what makes the financial community go 'round, but that industry happens to be the source of the whole world's present trauma. When I hear that the credit crisis has been solved, I just don't want to jump in the air with glee.

Just think, if you didn't borrow but saved, it would not mean all those interest charges went to support the lenders that are salivating at the thought that you can be advertized into loans that come with economic shackles for the rest of your life.

Good time to take a holiday from all that financial, and emotional, slavery for good. Thanksgiving seems like a good time to start on the road to real freedom.

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