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WASHINGTON (AP) - Americans are hunkering down and saving more. For a recession-battered economy, it couldn't be happening at a worse time.
Economists call it the "paradox of thrift." What's good for individuals—spending less, saving more—is bad for the economy when everyone does it.
On Friday, the government reported Americans' savings rate, rose to 2.9 percent in the last three months of 2008. That's up sharply from 1.2 percent in the third quarter and less than 1 percent a year ago.
Like a teeter-totter, when the savings rate rises, spending falls. The latter accounts for about 70 percent of economic activity. When consumers refuse to spend, companies cut back, layoffs rise, people pinch pennies even more and the recession deepens.
The downward spiral has hammered the retail and manufacturing industries. For years, stores enjoyed boom times as shoppers splurged on TVs, fancy kitchen decor and clothes. Suddenly, frugality is in style.
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Suddenly, frugality is in style? No, smart has finally out lived stupid, or greedy, or better still, screw the "Joneses".
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Way back when I got married, either 35 or 350 years ago, I can never remember, we were trained, told, read that we were supposed to save at least 5% and housing was supposed to never be more than 25% of combined income.
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Somewhere, those numbers got buried as fertilizer and up sprouted greed and stupidity. I'm not unfeeling, but if you spent 105% of your income for the last 10 years, your family of 4 was living in a 4200 sq ft house, you, the old lady and your kids each own every electronic device known to man, and you each have a car less than 5 years old...SCREW YOU!!
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You deserve to suffer, survival of the fittest does NOT include text messaging or leather upholstery.
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Sensible Stevie
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GO CARDINEELERS!!! (I don't really care)
8 comments:
"I'm not unfeeling, but if you spent 105% of your income for the last 10 years, your family of 4 was living in a 4200 sq ft house, you, the old lady and your kids each own every electronic device known to man, and you each have a car less than 5 years old...SCREW YOU!!"
Hmmm. When I read that at it's face value...
My house is only 3000 sf... I do NOT over spend (I save) but my family DOES have all the little toys, and we do not own a car under 5-years old... BECAUSE I WORK MY FUCKING ASS OFF TO GIVE MY FAMILY EVERYTHING I CAN; are you saying I should feel bad or appologize?
Maybe you should clarify or maybe I should say screw you too.
Schteveo - Knowing you - I'm just misreading and having a knee-jerk reaction - that's okay, I love you anyhow and if things get bad you're welcome in my house anytime, no questions asked.
Mr. & Mrs. C-Bug are here - we've had an outstanding time. Look for the picture I promised of C-Bug in her bikini - I will try to post it tomorrow after Mr. & Mrs C-Bug head on to the other islands after their too-short stay on O'ahu.
Did you set-up that shower cam jimbo?
I blame obama
Jimbo -
Are you
(1) spending 105% of your income to buy your "toys" and piling up massive debt (that you'll expect the gov't to bail you out of),
or (2) are you working hard and living within your means to buy your stuff? That's where the difference is. I don't think anyone here has a problem with the second scenario.
PS - Tell MR & Mrs C- Bug we all say hello.
Jimbo loves Schteveo
Jimbo loves Schteveo
Jimbo loves Schteveo
Jimbo,
IF you are saving, then you're not spending 105% of your income. I'm addressing the idiots who over bought, over spent, over impressed their family and neighbors with all the crap the "owned". You don't own it until it's payed for IMHO. I don't think that's you, or anyone here from what I've read about all of us.
We had a 2200 sq ft house for 3 of us, our cars were all new and we had(and still have) all the toys too. But we owned it, we saved for it, then bought, or owed way less than the max. We had months of savings, we did everything right, and we still lost our asses when I first became disabled. So it can happen.
I stand by my unfeeling part though.
Our country is in the economic toilet, because of those who spent their lives into a hole. Our country is in the economic toilet, because of the greedy assholes who loaned them the money or gave them lines of credit.
We're all paying the price of their combined ignorance and arrogance.
Ignorogance?
My angry tirade was in no way aimed at those that have it all, and do it right.
I save that for my ENVY!!
(do we have to pay for the C-Bug photos, candid photos, nudge, nudge, wink wink, know what I mean, know what I mean?)
Easy come, easy go.
Steve - I know your tyrade wasn't directed at me or "haves" - I was just tyrading, too; mainly because silly liberals don't believe I should have the "comfort" of supporting my family better than they can support theirs with free cheese.
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