PERSONAL FINANCE

Why Americans Are Going Broke

The new economic stimulus plan encourages consumers to spend money-but isn't that what got so many into trouble in the first place?

By Jennifer Barrett | Newsweek Web Exclusive

Feb 1, 2008 | Updated: 1:19 p.m. ET Feb 1, 2008

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Posted By: online money&software trainer @ 02/15/2008 5:40:41 AM

Comment: Americans are progressively growing broke because the greater percentage of their monies are spent on "Consumer Oriented items" versus "Income Generated items".
I am specially trained in Finances,Economics and investments but is not teaching on that right now.
However, I think the real crooks in being broke - is Really the lack of Key, Key! investment information.This we can substantiate, and prove to you easily,because within the 2% Rich Americans populace are some rotten rich people, some even at age 16.Which simple means that it is the right /key information along with a decision that will in effect move you from the 98% to the 2% category even overnight.!
We see people in our EDC Gold Business who easily make $50,000/month time and time again!
Would that make a difference in anyone's way of life or their family?
Would that possibly stop people's house or business from foreclosure?
Go to www.richleo.edcgold.com

We are willing to change some people's lives forever!
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Posted By: observer101 @ 02/14/2008 10:53:53 PM

Comment: Maybe people should start saving there own money for stuff they want rather that putting stuff on credit cards. Ist if you think about it, they are charging you to buy something that you cant really afford with the hopes that you will miss a payment, or pay the min payment for the next 3 yrs. @nd why pay someone to hold your money, or withdraw your money? Invest in a safe and put away your own loot, no bank fees, no late payment hassles. That is the banks main gig is to nickle and dime you to death with there legal mumbo jumbo. Perfect example....If you have direct deposit, and you have checks that YOU know will be covered when the bank opens they will put ALL of the checks through first.( so the 25$ bad check rule applies for not having sufficient funds) then put your direct deposit through and then ring up the charges you just racked up. Run the nonsuff chx through again and they hope you dont have enough to cover the second round of insuff. chx. and walaaa they just made atleast $100 on you. This is done thousands of times around the country and it rakes up a pretty good chunk of change. If you think about it how many average ppl switch banks for this exact reason, only to have it done again and again. Its the all mighty banks that are ripping us off with DEALS on loans then balloon the payment and wipe out ppls savings...Moral of the comment..Save your own loot and dont rely on the banks.
Posted By: SharedThought @ 02/13/2008 12:55:15 PM

Comment: The day after Thanksgiving has come to be called "Black Friday," because the large amount of revenue businesses receive that day, as many consumers begin to do their Christmas shopping on the day after Thanksgiving, helping the balance sheets of businesses go from being "in the red" to being "in the black." ...BUT, if many of those consumers used CREDIT CARDS to make those holiday purchases on the day after Thanksgiving, creating DEBT that they would later have to begin paying off, then doesn't that mean that, if the day after Thanksgiving is "Black Friday" for businesses, then that SAME DAY is "Red Friday" for HOUSEHOLDS that GO "INTO THE RED" on that same day. ...But, the media gleefully highllights "Black Friday." SO, is it any wonder if some consumers take a similar devil-may-care attitude about spending?
Posted By: nawawimohamad @ 02/11/2008 3:22:12 AM

Comment: We are not only living on borrowed money but we also living on other things borrowed.The clean air, clean water, nice weather and oil amongst others are being borowed from the future generations without us being able to pay back.
Posted By: tdn0024 @ 02/07/2008 8:58:46 AM

Comment: "The average American household owes 20% more than it makes." Is this a problem?

I bought a house where I owed $180,000. I was making $80,000. So I owed 125% more than I made.

And I was in great shape financially, and our family of 4 lived very nicely.

I am thankful for the banking system that enabled my $40,000 down payment to buy a nice $220,000 home, well in advance of my having the funds to buy such a home outright.

So my question: Isn't it a good thing that people have debt equal to 120% of their income?

For my young family, it was a great thing. It sure beat living in an apartment or a $40,000 house!
Posted By: Rick1217 @ 02/07/2008 3:33:54 AM

Comment: 40 years ago consumer spending was about 30% of the total economy; back then it was manufacturing, investment, innovations, government fiscal restraint (a few times). But now consumer spending is over 60% of the economy. That is so dangerous towards the creation of a 2 class caste system that it is frightening. Government debt control is imperative! The dollar is now almost the lowest currency on the planet; things are going to start to get expensive from overseas and then other countries will once again pay our buildings, our banks, probably Ford, etc. with cheap dollars. Learn to speak Chinese or Farsi Baby if you want to survive OR get an arsenal.
Posted By: phiomalibumalibu @ 02/06/2008 9:16:45 PM

Comment: True - set limits, but I consolidated all my debt at a great rate at CreditLoanApproved.com + cash back I would highly recommend them!
Posted By: NickWill @ 02/06/2008 3:51:08 PM

Comment: the government should actually set limits on how much you can borrow, depending on your income?
The citizens of the U.S. should set limits on how much the government can borrow, period! That is the single biggest contributor to the deflation of the U.S. dollar by 50% in the last decade. The U.S. economy would be far brighter if it did.
Posted By: NickWill @ 02/06/2008 3:50:05 PM

Comment: the government should actually set limits on how much you can borrow, depending on your income?
The citizens of the U.S. should set limits on how much the government can borrow, period! That is the single biggest contributor to the deflation of the U.S. dollar by 50% in the last decade. The U.S. economy would be far brighter if it did.
Posted By: onlc2660 @ 02/05/2008 12:13:33 PM

Comment: Comment: I am a 58 years old. My first heart attack, 100% blockage of my left coronary artery, that was 26 years ago, I have restarted my life 4 times due to additional episodes of health problems. If and when I and my wife receive a rebate from the Government it will be used to by down my debt. After all is said and done it is only my personal economy that counts. If more people took their own economy into account, we would not be in the shape we are today.
Posted By: richdear @ 02/04/2008 9:50:51 PM

Comment: My wife and myself are retired. We have no debt and can use interest on our savings to supplement our social security. Recently the lowering of the prime rate effects our CD's. Also the government lowered the amount of I bond purchases from $30,000 to $5,000. They don't want us to save!
Posted By: Holly Garfield @ 02/04/2008 11:23:44 AM

Comment: One key to spending is that your spending is some else's paycheck. We may be a bit overextended for credit, but a significant pullback can easily deepen any economic dip we have. Yes, there will always be those who overspend, but that is part of having 300 million people. As the author points out, many economies that have high savings rates are also very sluggish. China has a problem in that their citizens are so saving oriented that their domestic economy is suffering, and they rely too much on exports for growth. This makes them very sensitive to the US slowdown. Citi is now in the process of cancelling subprime credit cards in one of their divisions. This is a move that will help stabilize the economy without upsetting the economy too much. More banks should follow. In the meantime asking millions of people to suddenly change their spending habits is a bit unlikely to work. Asking the financial institutions to tighten their internal low end consumer credit policy is more liekly to work since this involves a relatively few professionals who are currently getting hurt due to their own policies. Since they are now getting hurt, we probably don't even have to ask. This is all part of the normal business cycle. By the way, proposing legal credit limits based on income is something thak cannot work. What about the people like me who live off investments and have no guaranteed income, and my unrealized capital gains are not even reportable, or others who have either non-guaranteed or non-reportable means of income? The problem appears to be more complex than even the author understands. There are also legal issues outside of consumer credit involved in regulation, such as personal privacy issues and over-regulating businesses. There is no one action that will get us through the current problems. A cutback in low end credit is a part of the solution, however. And the financial losses we are having will take care of that as the banks cut back on credit on their own.
Posted By: phiomalibumalibu @ 02/04/2008 2:05:01 AM

Comment: Great interview. It's true I think. I reconsolidated all my loans into one at creditloanapproved.com and I donated my car (thanks to my wife) to AutoGiver.com (its a gas guzzler) We are going to buy a hybrid with the tax-credit from the donation. So, its a start for us. Seems like the future is brighter now. Good Luck!
Posted By: Liora @ 02/03/2008 6:51:14 PM

Comment: If you are interested in this interview, definitely check out his book. Not only will it give you a lot more insight into the problem, it's loaded with solid advice and suggestions for improving things. And it's axctually fun to read. I agree--it is about time "we the people" get educated and take a stand!
Posted By: eddiewhere @ 02/03/2008 5:43:45 PM

Comment: Comment: FInally someone who recognizes that corporate America has indoctrinated the average JOE. Spend and make them wealthy while you go broke and live a life of debt. Why do you think that the FED lowered interest rates twice. THEY do not want AMERICAN CITIZENS TO SAVE and INVEST.
STAY STUpid is the essence behind this problem. IT is the reason individual are broke. THEY HAVE BEEN completely indoctrinated. BUSH's policies represents this economic feudalism.
EIGHTY percent of the world's capital is owned by a thirteen to twenty families. BUSH's are directly linked to these families. THE QUEEN of ENGLAND is part of this as well. IT IS IN THEIR BEST INTEREST TO KEEp people STUpid. INDOCTRINATE THEM TO Spend and manipulate the economy through the FEDERAL RESERVE to encourage people to spend. EVERY AMERICAN need to learn this RULE.
The middle class has been the victim of corporate indoctrination. Stay StuPid. They do not want you to double your money they want you to double their money. Every middle class family should be able to do compound interest problems in their heads. It can be learned in grade two. It is a very useful skill to have because it gives you a lightning fast benchmark to determine how good (or not so good) a potential investment is likely to be.
The rule says that to find the number of years required to double your money at a given interest rate, you just divide the interest rate into 72. For example, if you want to know how long it will take to double your money at eight percent interest, divide 8 into 72 and get 9 years. If the Middle Class can make better financial decisions it would have a profound affect on the economy.
The rule A stronger middle class will make the rich richer in the long run and helP uPlift the Poor.
Posted By: eddiewhere @ 02/03/2008 5:43:08 PM

Comment: Look and listen carefully. Is he avoiding detail, is he camaflouging his real agenda. Can he really make you believe that he will leave no child behind again, How many times can one nation be foolded. Think about all the bankrupt people sitting at home, those in debt, those without healthcare, and unable to afford education watching his speech. Their probably wondering how they could have been suckered into voting for this guy.They did not listen and we all know many of them voted for Bush in two thoudand four. OBAMA/.Hillary for president.
WHY CAN'T WE SEE THAT THE PeoPle Profiting from the war are haPPy with the status quo. WHo are these PeoPle,
Private Contrators who lobbied the RePublican adminstration
Cheney/ Halliburton who Provided billion dollar contracts to selected firms.
These caPitalists decided to unite and Profit in Iraq, Build a new economy in Iraq where the oil comPainies, caPitalists that suPPort the Bush Administration, War Profiteers and other Private comPanies could all make Billions at the tax Payers exPense. HERE"S THE proof, keep in mind this is just the tip ot the ice berg

Cheney's stock options which were worth $241,498 a year ago, are now valued at more than $8 million-- for an increase of 3,281% . Cheney has pledged to give the proceeds to charity. Cheney continues to receive a deferred salary from the Halliburton. He was paid $205,298 in 2001; $162,392 in 2002; $178,437 in 2003; and $194,852 in 2004.

Halliburton, has already raked in more than $10 billion for work in Iraq, and was handed some of the first Katrina contracts. The company has been criticized by auditors for its handling of no-bid contacts in Iraq, and there have been numerous allegations of over charging for services. Auditors found the firm marked up meal prices for troops and inflated gas prices in a deal with a Kuwaiti supplier. The company also built the American prison at Guantanamo Bay. "It is unseemly for the Vice President to continue to benefit from this company at the same time his Administration funnels billions of dollars to it. Lautenberg???
They even "pimped" our troops. ENOUGH IS ENOUGH
Do you think Bush and Cheney care that we are spending billions in IRAQ, NO. THis is why they hated the CLINTONS. THE CLINTON"S ACTUALLY USED TAX payer money to help the middle class and all AMERICANS.
Posted By: eddiewhere @ 02/03/2008 5:42:35 PM

Comment: Our country is too large to have all its affairs directed by a single government. Public servants at such a distance, and from under the eye of their constituents, must, from the circumstance of distance, be unable to administer and overlook all the details necessary for the good government of the citizens; and the same circumstance, by rendering detection impossible to their constituents, will invite public agents to corruption, plunder and waste." --Thomas Jefferson to Gideon Granger, 1800. ME 10:167
"I consider the foundation of the Constitution as laid on this ground: That "all powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States or to the people." [X Amendment] To take a single step beyond the boundaries thus specifically drawn around the powers of Congress, is to take possession of a boundless field of power, no longer susceptible of any definition." --Thomas Jefferson: National Bank Opinion, 1791. ME 3:146

We have been fooled by our own government and there is no way any Republican is going to win this election. THE Middle class has had it with all this Bin LADEN terrorist crap. WE are now scared of our own government more than we are of the terrorist because the decisions this government is making on our behalf is not in our best interests and it is killing us. The government is now dominating our civil liberties. They are giving the states millions for Real ID Cards. This is just the start of government intrusion. Combine this with the misuse of the Patriot Act and the future Plans of insurance comPanies and corporations to have full access to our personal records and we have a real crisis.
Credit Card companies have already started selling and sharing our personal information with the private sector. We really have to wake up and protect our constitution it is all we have to defend ourselves against interests that become too rich and powerful in this country. The government keeps expanding and is being predominantly controlled by special interest and lobbyist. The middle class is being weakened and our civil liberties are being threatened. Real ID Cards will not make "us safer" infacat terrorists can obtain fake ones and move about freely. The American people did not vote on Real ID Cards, we need a vote. Our constitution would have to be ammended in order for Real ID's to become legal. I do not know what has happened in Washington but it is getting out of hand. They know what they are doing is unconstitutional so they are trying to bribe the states by offering them money. I hope every state agrees with me and Prevents the federal govenment from imPosing and unconstitutional law. If the states allow the government to do this then they would have set a bad Precedent that could lead to further government violations.
Posted By: eddiewhere @ 02/03/2008 5:41:52 PM

Comment: FInally someone who recognizes that corporate America has indoctrinated the average JOE. Spend and make them wealthy while you go broke and live a life of debt. Why do you think that the FED lowered interest rates twice. THEY do not want AMERICAN CITIZENS TO SAVE and INVEST.
STAY STUpid is the essence behind this problem. IT is the reason individual are broke. THEY HAVE BEEN completely indoctrinated. BUSH's policies represents this economic feudalism.
EIGHTY percent of the world's capital is owned by a thirteen to twenty families. BUSH's are directly linked to these families. THE QUEEN of ENGLAND is part of this as well. IT IS IN THEIR BEST INTEREST TO KEEp people STUpid. INDOCTRINATE THEM TO Spend and manipulate the economy through the FEDERAL RESERVE to encourage people to spend. EVERY AMERICAN need to learn this RULE.
The middle class has been the victim of corporate indoctrination. Stay StuPid. They do not want you to double your money they want you to double their money. Every middle class family should be able to do compound interest problems in their heads. It can be learned in grade two. It is a very useful skill to have because it gives you a lightning fast benchmark to determine how good (or not so good) a potential investment is likely to be.
The rule says that to find the number of years required to double your money at a given interest rate, you just divide the interest rate into 72. For example, if you want to know how long it will take to double your money at eight percent interest, divide 8 into 72 and get 9 years. If the Middle Class can make better financial decisions it would have a profound affect on the economy.
The rule A stronger middle class will make the rich richer in the long run and helP uPlift the Poor.
Posted By: jefors @ 02/03/2008 2:34:38 PM

Comment: Re: trusty1two
regarding your daughter's tax refund...don't fool yourself...inflation is NOT increasing at 5% a year. there are 6-month and 12-month CDs that will give her at least 5% return on her money if she can part with it for that long. first and foremost have her apply the refund toward any debt that she has that exceeds an interest rate of 5% (ie. credit cards, auto loans, or anything besides a home loan) and if she has none and has one of the rare good heads of the country on her shoulders then have her put it in the said CD. standard bank savings accounts will only return around 3-4% and credit unions usually a bit more but CDs are safe in a volitile economy and will still outpace inflation.
Posted By: jefors @ 02/03/2008 2:27:26 PM

Comment: here's a novel concept: don't spend more money than you make. today, everybody lives like they're wealthy...new cars, new or remodeled homes, second and third mortgages, and nobody is making more money than they were years ago before this disease started to infect the country. take a lesson from your parents and grandparents and don't buy stuff you can't pay cash for with only one exception...your home. otherwise, but used cars and run them until the wheels fall off. cars are the single most awful waste of money in the world today and made worse by the cost of fuel and repairs. don't buy a house if you can't afford to pay a conventional mortgage (principle and interest). interest only loans and the like are for the unwise and greedy, ask countrywide home loans. wise up folks and start living within your means! if you have to take a loan to buy it (and this includes credit card debt) then DO WITHOUT or save cash the old fashioned way before they had credit cards and second mortgages. we are shooting ourselves in the feet and creating a much worse economy for future generations (not to mention setting a rotten example) and we must get control of it.
Posted By: jefors @ 02/03/2008 2:27:11 PM

Comment: here's a novel concept: don't spend more money than you make. today, everybody lives like they're wealthy...new cars, new or remodeled homes, second and third mortgages, and nobody is making more money than they were years ago before this disease started to infect the country. take a lesson from your parents and grandparents and don't buy stuff you can't pay cash for with only one exception...your home. otherwise, but used cars and run them until the wheels fall off. cars are the single most awful waste of money in the world today and made worse by the cost of fuel and repairs. don't buy a house if you can't afford to pay a conventional mortgage (principle and interest). interest only loans and the like are for the unwise and greedy, ask countrywide home loans. wise up folks and start living within your means! if you have to take a loan to buy it (and this includes credit card debt) then DO WITHOUT or save cash the old fashioned way before they had credit cards and second mortgages. we are shooting ourselves in the feet and creating a much worse economy for future generations (not to mention setting a rotten example) and we must take back control of this vice.
- Posted By: NeoLotus @ 02/05/2008 13:43:34
  
  Comment: Who's the "everybody" that lives like they are wealthy? Try supporting a family on $10/hr and see how far you get.
Posted By: Trusty1two @ 02/03/2008 12:24:39 PM

Comment: My Daughter got back a nice refund on her Federal taxes. She ask me what to do with it. I told her she could put it in a savings account but it would be wotth less in one (1) year then it is now because of inflation. A new car will be worth a lot less. A home is not a good choice at the present time. The stock market is living on borrowed time because of the speculators. You tell me where you can put your money, have access to it and have more buying power a year from now.
- Posted By: jefors @ 02/03/2008 14:45:47
  
  Comment: Comment: Re: trusty1two
  regarding your daughter's tax refund...don't fool yourself...inflation is NOT increasing at 5% a year. there are 6-month and 12-month CDs that will give her at least 5% return on her money if she can part with it for that long. first and foremost have her apply the refund toward any debt that she has that exceeds an interest rate of 5% (ie. credit cards, auto loans, or anything besides a home loan) and if she has none and has one of the rare good heads of the country on her shoulders then have her put it in the said CD. standard bank savings accounts will only return around 3-4% and credit unions usually a bit more but CDs are safe in a volitile economy and will still outpace inflation.
Posted By: missgarlic @ 02/03/2008 12:16:56 PM

Comment: big oil , banks, and taxes on gasoline and savings have all grabbed most of the excess spending cash we american have. this sounds like a socialist society run by government.
I remember Greenspan saying he was going to burst the bubble and get a soft landing,,,,,,,what ever that means. we must take a second look at where we are heading with the current type of politicians we are electing into office and put term limits to some of the offices. to much back door favors going on, such as why we cannot get a simple $800 rebate, why is our fate in the hands of overpaid and over aged politicians.
Posted By: djonesss @ 02/02/2008 1:52:51 PM

Comment: We need to have our people in debt. Some of the hardest working citizens in our nation's history were indentured servants. They worked off their debt and became the backbone of America. We are now returning to those glory years, where millions are truly indebted and will have to work hard for the rest of their lives to pay it off. Once unemployment is up, people will be willing to work for low wages just like India and China, and America will once again be competitive. True, many will live and die in poverty, and the gap between the haves and have-nots will spread, leading to civil unrest. But that is the way things have been since the beginning of time. It is obvious that people would rather spend their way into debt and then climb out of it rather than live more modestly and avoid the pressure. Deep down inside, they just know that they will not work as hard if they do not have that monkey on their back.
Posted By: misterharban @ 02/02/2008 12:11:23 PM

Comment: Why wouldn't we spend recklessly and lenders lend recklessly when our tax laws and financial experts encourage the mindless purchase of real estate at any price and our bankruptcy laws encourage lenders to extend credit without regard to the borrower's creditworthiness? Homebuyers believed that real estate is a risk free investment that will always pay off -- amazingly, so did their lenders. That's what happens when you don't teach history in schools.
Posted By: Olderthing @ 02/02/2008 9:24:43 AM

Comment: Isn't it a wee bit odd when the primary equity for most Americans, their home, becomes a pawn in the Wall Street game? Of course Wall street was only capable of giving out $20 billion in bonuses this past year due to the homeowners being "greedy and irresponsible".. You steal peoples home and get a bonus: It smell a lot like criminal activity, organized criminal activity.
Posted By: cindydrake @ 02/02/2008 8:54:30 AM

Comment: We are going to put our rebate straight into savings. We are now to the point where we only owe for house and vehicles--all other debts are paid off. Now we actually have money in the bank and will be putting extra toward the house and cars. I agree with the person below who said that none of the politicians will pay your bills. You have to do what's right for your household, and in many American cases, this means pay down debt or save it.
Posted By: carnabylane @ 02/02/2008 7:13:42 AM

Comment: I have no debt & no credit cards. I payed cash for a 600 sq ft a-frame that is inexpensive to heat & cool because I insulated it well and it's a small.space. I have a gray water system to keep my water bill & usage down. I keep a year supply of food staples replenishing when items are on sale. I shop for food and household supplies from the sale flyers. I do not buy anything I can't pay cash for. I do not eat out or go to bars. I have a TV antenna instead of expensive cable or satellite. I check out DVD's from the library instead of going out to the theater or renting them. I roll my own cigarettes limiting them to 4 a day. I buy my clothing and household items at St. Vincent DePaul or other thrift stores. That is how I keep my head above water. I will not go out and spend a rebate I will put it aside for a rainy day.
- Posted By: jefors @ 02/03/2008 14:51:59
  
  Comment: you rock! you're exactly what this country needs more of. if the country was full of people like you it would be the PEOPLE running this government and not the other way around. hats off.
Posted By: kerryln @ 02/02/2008 1:44:38 AM

Comment: work hard and save your earnings. Shop Goodwill and clip coupons..... be thrifty. Just got back from eating out in a fancy restaurant ironically filled with young people. I probably was the only person who could truly afford to be there. But when you're young you have no time to wait for that trophy home, BMW, and all the things that I have , guess you'll have to keep hoping Uncle Sam keeps succoring you.
Stew
Posted By: kerryln @ 02/02/2008 1:43:59 AM

Comment: work hard and save your earnings. Shop Goodwill and clip coupons..... be thrifty. Just got back from eating out in a fancy restaurant ironically filled with young people. I probably was the only person who could truly afford to be there. But when you're young you have no time to wait for that trophy home, BMW, and all the things that I have , guess you'll have to keep hoping Uncle Sam keeps succoring you.
Stew
Posted By: kerryln @ 02/02/2008 1:42:33 AM

Comment: work hard and save your earnings. Shop Goodwill and clip coupons..... be thrifty. Just got back from eating out in a fancy restaurant ironically filled with young people. I probably was the only person who could truly afford to be there. But when you're young you have no time to wait for that trophy home, BMW, and all the things that I have , guess you'll have to keep hoping Uncle Sam keeps succoring you.
Stew
Posted By: Striker41 @ 02/02/2008 12:46:17 AM

Comment: If the government encourages taxpayers to spend the rebate checks, but is fearful that the money will only be socked away, invested, or used to pay down personal debt, then the treasury needs a way to control how the money is spent. But how? Gift cards. Millions of them. They must be spent and generally can only be used to purchase goods and services. You want cash instead? You'll have to sell what you purchased. But all this stimulus is bittersweet. We know the government shouldn't afford it, and the IRS will want it back next year because it is income. Rob, St. Louis
Posted By: mjwallin @ 02/01/2008 3:39:15 PM

Comment: Besides living beyond one's means, we have only the government to thank for our situation. The Constitution provides that money be of 'gold and silver' only. In 1913, we started down the road to inflationary ruin when the Fed was created to foster the fiat money system ("money from nothing"); FDR, a devout Keynesian, took us off of the gold standard. Savers were tossed aside iin favor of Wall Street Bankers and speculators.
- Posted By: mjwallin @ 02/01/2008 15:43:27
  
  Comment: Vote Ron Paul - restore gold standard and abide by the Constitution. Fiat money is a plague.
Posted By: mjwallin @ 02/01/2008 3:39:07 PM

Comment: Besides living beyond one's means, we have only the government to thank for our situation. The Constitution provides that money be of 'gold and silver' only. In 1913, we started down the road to inflationary ruin when the Fed was created to foster the fiat money system ("money from nothing"); FDR, a devout Keynesian, took us off of the gold standard. Savers were tossed aside iin favor of Wall Street Bankers and speculators.
- Posted By: mjwallin @ 02/01/2008 15:41:18
  
  Comment: Sorry for the duplicates - the Newsweek Server should be called the Newsweak server.
Posted By: mjwallin @ 02/01/2008 3:38:56 PM

Comment: Besides living beyond one's means, we have only the government to thank for our situation. The Constitution provides that money be of 'gold and silver' only. In 1913, we started down the road to inflationary ruin when the Fed was created to foster the fiat money system ("money from nothing"); FDR, a devout Keynesian, took us off of the gold standard. Savers were tossed aside iin favor of Wall Street Bankers and speculators.
- Posted By: jefors @ 02/03/2008 14:55:56
  
  Comment: you resight interesting and impressive facts but nobody can argue the fact that at the end of the day we're all responsible for our own fate or fortune. it's blaming the government for everything and NOT taking personal responsibility for our actions that has gotten us in this predicament in the first place. less blame and more accountability PLEASE!
Posted By: Change is a verb not a platform @ 02/01/2008 3:37:50 PM

Comment: what to do with your rebate.
1. Pay down debt
2. Save it
No mater who you vote for - NONE of them will be paying your bills.
Posted By: jdf212 @ 02/01/2008 3:35:07 PM

Comment: s
Posted By: StarTrekFan @ 02/01/2008 3:30:24 PM

Comment: It took us 5 years to crawl out of the financial mess that we were in. One of the things that my wife and I had to learn was to ask "Do we need this or Do we want this" before any purchase. Most of the time we would only buy things if we needed them.
- Posted By: jefors @ 02/03/2008 14:56:50
  
  Comment: inspiring! spread the word!
- Posted By: Change is a verb not a platform @ 02/01/2008 18:04:03
  
  Comment: It is a challenge to break those old habits. Good for you!
Posted By: Saltydog_0 @ 02/01/2008 2:41:24 PM

Comment: Excellent article, but it doesn't address the underlying cause of America's financial troubles; namely that we are a society of addicts. Addicts are people that pursue instant gratification despite the long term effects. Addicts cannot stop. Even when they have some notion that their actions are harming them, they do not have the power to change.

We are addicted to oil. We are addicted to consuming. We are addicted to power.

Every now and then you see an article like this that points out how our actions are costing us more than we can bear to repay. While everything being said is true, every reader knows that stating the truth has no effect. If we, as a society. were capable of deciding to change our ways, we would have done so long ago. The effects of our addictive nature have been glaringly obvious for several decades now. What have we done in response? Increased our dependance on oil. Increased our borrowing to sustain our consumer culture. Increased our dominance over other countries.

Like all addicts, our society can never get enough of our drug of choice. We must have more, more, more. We do not act out of reason. We act out of an insatiable need. There's a saying among those familiar with addiction: "You can't reason yourself out of something you did not reason yourself into."

This articles means well; and it certainly doesn't do any harm. But, in the end, the message will be forgotten as soon as we become distracted by some shiny object that we simply MUST have. We, the readers, will be thinking about how we should save our refund, start paying down our credit cards, etc. And then. . . "Ooh. What's that?! A big screen TV? ON SALE?!" And like lemmings over the cliff we'll pull out our credit cards.

OK. So maybe I won't do that. And maybe YOU won't. But WE will. We. . .just. . .can't. . .stop.

The good news is that, one way or another, every addict stops. They either stop by getting help or by going to the grave. Is there a 12-step program for countries? No? Grave it is then.
- Posted By: jefors @ 02/03/2008 15:02:14
  
  Comment: very insightful. let's remember, the $3000 plasma tv that is 30% off doesn't save us $1000, it sets us back $2000.
- Posted By: ZUMOFALLFEARS @ 02/02/2008 10:02:40
  
  Comment: WELL SAID
- Posted By: ZUMOFALLFEARS @ 02/02/2008 10:00:55
  
  Comment: WELL SAID
Posted By: CivilServantBradley @ 02/01/2008 1:43:11 PM

Comment: The market needs a correction. based on speculative homebuying and people using equity as personal checkbooks, we've ramped up our economy and national debt. The author hit the nail on the head in the final paragraph. We need economic reform, and it starts with changing the way we as Americans spend (and save) money.
- Posted By: phowells @ 02/02/2008 10:54:14
  
  Comment: "We have only the government to thank for our situation."
  
  We have met the enemy and he is us.
- Posted By: phowells @ 02/02/2008 10:53:43
  
  Comment: "We have only the government to thank for our situation."
  
  We have met the enemy and he is us.

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