Thursday, May 01, 2008

The boom-bust cycle

Take a look a this article from the Arizona Republic. Although written with real sympathy to those who now find themselves deep in debt, it leaves me wondering "what were these people thinking?" and "who failed to teach them about basic fiscal responsibility?" Since when is it a good idea for someone living in a mobile home to fill it with electronic gear?

Or maybe the point of many of our fiscal institutions, including the Fed, is to promote fiscal irresponsibility. As I watch the Fed lower rates, and the government hand out money, to induce debt-laden people to spend more, it's hard for me to deny that possibility out of hand. Fiscally irresponsible people are easier to control, after all.

5 comments:

Jim Peet said...

Sadly most americans are ignorant about fiscal responsibility. One sees it in personal lives, in families, in churches, businesses and the government.

If you want some fiscal responsibility "entertainment" (poor choice of a word!) check out www.prosper.com and look what many people are trying to borrow money for: a vacation, a diamond ring, etc.

Bike Bubba said...

I believe I saw that--hadn't you mentioned it once before as a free market in loans? You're right; I was appalled.

Bike Bubba said...

Well, credit card companies have essentially been doing this for what--40, 50 years, now? Add into that the pawnbrokers and loan sharks of the world, and this isn't anything new; it's just automated.

Shawn said...

hmm. that was a foolish comment of mine, wasn't it? not quite sure what I was thinking there.

Bike Bubba said...

Nah. It's never wrong to be somewhat incredulous at the kind of decisions we encourage, in my not humble enough opinion.