On the news earlier this afternoon they were discussing how Americans are saving their money and how it was a bad thing and they even mentioned that it causes depression and people should spend more because it's not making anyone happier.
I do see a point of luxuries in moderation but the whole story seemed to be a bunch of BS propaganda to get us to spend money and feel bad about saving it.
Just wondering what you gals thought.
snwb08
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actually I'm taking classes on this now, and based on history (sorry for sounding like a dork, i'm literally reading about the 'panic' of 1907 which sounds way similar even though it was 100 years ago) problems are caused when people hold on to their money, when banks want to hold onto their reserves - which is what they are doing now instead of issuing more credit like the govt expected them to as part of the bailout.
spending leads to rises in CPI, increases in jobs, and inflation. Inflation isn't always bad - it's good for the economy in moderation - but right now we're more in a deflation situation (though that hasn't happened yet) because the goverment is printing money.
hm... be nice if I'd get an A in a class for once.
SFAR89
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Posted by snwb08
actually I'm taking classes on this now, and based on history (sorry for sounding like a dork, i'm literally reading about the 'panic' of 1907 which sounds way similar even though it was 100 years ago) problems are caused when people hold on to their money, when banks want to hold onto their reserves - which is what they are doing now instead of issuing more credit like the govt expected them to as part of the bailout.
spending leads to rises in CPI, increases in jobs, and inflation. Inflation isn't always bad - it's good for the economy in moderation - but right now we're more in a deflation situation (though that hasn't happened yet) because the goverment is printing money.
hm... be nice if I'd get an A in a class for once.
That makes a lot of sense. We really need someone to guide us into this, and I don't know if Obama is really doing that great of a job so far with that. I really , honestly, don't know b/c I don't follow it...I just hope that whatever he is doing will start to clear things up soon.
MCA1180
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hmm... yeah definitely sounds like that to me....
yes, spending is good for the economy, but nowadays alot of people don't have much to spend even if they wanted to... what with so many people losing their jobs and homes on a daily basis! and the people that do have some kind of money (be it a little or alot) are holding onto it as long as possible because they don't know what tomorrow may bring.. maybe they'll lose their job too.... generally speaking! then there's people that don't have to worry either way... so everyone's in a different category..
snwb08
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Posted by MCA1180
hmm... yeah definitely sounds like that to me....
yes, spending is good for the economy, but nowadays alot of people don't have much to spend even if they wanted to... what with so many people losing their jobs and homes on a daily basis! and the people that do have some kind of money (be it a little or alot) are holding onto it as long as possible because they don't know what tomorrow may bring.. maybe they'll lose their job too.... generally speaking! then there's people that don't have to worry either way... so everyone's in a different category..
this is definitely true; people are panicking and not spending what they have. it's just saying I guess that the lack of spending is making things worse, but if people don't have it, they can't spend it.
me, i still spend. every vacay I go on this year I tell DH - 'I'm stimulating the economy!!'
futuremrsfab
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interesting, but I agree with a pp it sounds like propaganda to me- our spending habits have changed- but less to do with the economy and more to do with that we now have a mortgage and a year ago we didnt
Autumn08
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I don't think people have the confidence to be spending like they were. When major companies are being bailed out multiple times and still laying off workers, it's no wonder people are 1. scared of losing their income, and 2. angry. Why should we pay to buy products and then pay to help these companies who have been mis-managed? Maybe that's just how I feel. I do spend a little, save a little. IMO it's irresponsible to tell people to not save their money in this economy, and basically scare them, if you don't spend money you'll be depressed. I'll be more depressed if I have to move back with my parents! And families will be mroe depressed if they can't put food on the table.
