Russell and Duenes

Your Money or Your Life

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My wife and I have started reading a little gem of a book, Your Money or Your Life, by Vicki Robin and Joe Dominguez. This tidbit from the Introduction caught my attention. Of course it’s nothing new, but it beggars the mind anyway, and it makes me realize that if this is true of people personally, it is no wonder that we tolerate a federal and state government that acts similarly with money.

Speaking of debt, well, where do we start? A savings rate hanging near 0 is a nice way of staying in hock, in the suds, on the rocks – that is, in debt. Did you know that credit-card debt of the average U.S. consumer is over $3,000 and of the average household over $8,000? That’s not even counting the over $5,000 of mortgage and auto debt the average American carries. Encouraged at every turn to consume, we have spent every penny and taken advantage of debt limits on multiple cards and, during the market and housing bubbles, used home equity loans and subprime mortgages to keep creditors at bay. We’ve wrung out every resource for its debt potential – and we’ve pretty much reached the end of that game. More Americans now declare bankruptcy than graduate from college. But it gets worse. According to the U.S. National Debt Clock the public debt as of August 27, 2008, was $9,624,855,389,454, increasing at over $1.85 billion a day for the last year. This translates to over $31,500 for every U.S. citizen. Whose debt is that? Ours. (And how are we going to cover that?)

-D

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Written by Michael Duenes

July 18, 2010 at 11:26 am

Posted in Duenes, Economics

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