11.27
As you very well know, the country is in a bind with credit lending and borrowing crisis in the media. We have a considerable rise in foreclosures due to incompetence from lenders to qualify borrowers. As for me, the little guy, I forecasted such a scenario as huge homes were built and the owner who seemed plentiful were able to purchase 400K+ homes along with several new cars in the driveway. Indeed, that situation is very common today.
However, for some reason we had a bad mix of sketchy lenders and unrealistic borrowers converging. We need to be aware of your surroundings to gauge economic activity, never solely rely on stats and government figures. Not everyone, even combined incomes, can afford a generous lifestyle realistically without devoting an amount towards saving and investment. Negative savings is higher than ever and now we are hitting the holiday season with a less than spectacular consumer spending report. As for the negative savings hype, it’s rather mistakenly unreported due to the fact it may not necessarily factor in today’s description for high debt of consumers. Yes, credit cards are at a record holding along with record balances, yet families are also playing the stock market and investing in general more than ever compared to 20 to 30 years ago. That said, we have an adjustment only the financially literate and economist can understand. Rest assured, the negative savings hype should be addressed, yet nothing to point at recession fears. Of course this along with foreclosures spells opportunity for some. I hope things get better and individuals start a more conservative effort towards their spending habits.
For more information on where this blurb came about, see the latest article here.