The American Dream Built on Debt, Living in Beverly Hills

[Scataphagos]

Quote from marketsurfer:

here is a thought:

Debt equals optimism equals boom times for all.

Does that include debt (1) you'll never be able to repay, and/or (2) debt you never INTENDED to repay?

 

[risktaker]

All I know is the country is slowly withering away, one industry at a time. Thanks to the greed, extravagance, stupidity & calousness of many, future generations will grow up without much of a future in the US.

Quote from Scataphagos:

Regardless of everything else, legacy costs and union influences = lesser product.

Either lesser quality for the same money as Asian competitors, or equal quality car for more money.

If American car makers can't retool and compromise, they will eventually be gone... regardless.

 

[Scataphagos]

Quote from risktaker:

All I know is the country is slowly withering away, one industry at a time. Thanks to the greed, stupidity & calousness of many, future generations will grow up without much of a future in the US.

Picture the Soviet Union before the collapse... where nearly ALL of the GDP went to military expense to fight the cold war with the USA.... and 90% of the population stood in line for their ration of potatoes and toilet paper..

We're not "spending everything" on military, but we're still barreling down that path of "government consumes everything... people have little-to-nothing".... Obama is ACCELERATING our demise...

 

[jjf]

Quote from Scataphagos:

Obama is ACCELERATING our demise...

You mean "middle class" demise.

Wall Street has now become America, Main Street is no longer important.

jjf

 

[Appleseed]

i recall when the Schuykill Expressway was built, sometime in the early 50's. It became inadequate and outmoded shortly
afterwards. During this period Pres. Eisenhower decided that we
would become a society of highways and auto's.
The why of that has been written about extensively...something about his service during WW! when he saw how the highways in France helped to move armies and aided in its defence...i think.
We also then became the biggest energy consuming country
in the world and dependent on the kindness of our oil producing
friends.
Unless we develop our railroads and other means of public transportation your co mutes will continue to get longer(I'm retired)
and more costly in time and money
cheers
john

 

[Scataphagos]

Quote from jjf:

You mean "middle class" demise.

Wall Street has now become America, Main Street is no longer important.

jjf

Main Street not important (financially) is true. As far as "the rich get richer", not really.... not most, anyway.

The poor had nothing, still do.

The middle class has been severely "trimmed".... many now have virtually nothing.

The rich are paying all of the bills and will continue to do so. Most of those currently thought of a "rich" will be POOR by the time Obama gets through implementing his delusional, narcissistic, pathological bilge.

 

[Scataphagos]

Quote from Appleseed:

i recall when the Schuykill Expressway was built, sometime in the early 50's. It became inadequate and outmoded shortly
afterwards. During this period Pres. Eisenhower decided that we
would become a society of highways and auto's.
The why of that has been written about extensively...something about his service during WW! when he saw how the highways in France helped to move armies and aided in its defence...i think.
We also then became the biggest energy consuming country
in the world and dependent on the kindness of our oil producing
friends.
Unless we develop our railroads and other means of public transportation your co mutes will continue to get longer(I'm retired)
and more costly in time and money
cheers
john

Since the oil embargo of the '70s, periodically politicos have stated "we need to reduce our dependence on foreign oil"... all LIP SERVICE.

35-40 years ago, we as a country could have legislated that cars get "much more MPG"... and weigh no more than 2500 (or 2000) pounds. We'd be getting 40 mpg on average now... maybe more. (Remember the VW Beetle? Weighed in at <2200 pounds, if I recall... wasn't that great on gas considering the low weight. But if we were using the "Bug" model and with current technology, our entire fleet of cars might have been getting Prius MPG numbers for DECADES already.)

Could have been done... wasn't.

 

[Rickshaw Man]

Quote from wildfirepow:

For the last three decades millions of Americans have been living in Beverly Hills. How can this be? Only 35,000 people reside in Beverly Hills, California. Millions have acted like they live in Beverly Hills, where the median household income is $125,000. The median household income in the United States is $50,000. There are 116 million households in the United States. Only 12 million households have income of $125,000 or more. There are 60 million households making less than $50,000.

Why shouldn’t the 60 million households be entitled to live like the top 10%? This is America, where the American Dream of wealth and riches is achievable. Just one small problem. Millions chose to live like the privileged Beverly Hills elite without doing the difficult work to earn their way into the top 10%. They made these dreadful decisions of their own free will. No one forced millions of Americans to borrow and spend like drunken soldiers.
It appears that the psychology of the nation transformed in the early 1980’s. Was it the optimistic message of “Morning in America” preached to the country by Ronald Reagan? Was it the fact that the youngest Baby Boomers were turning 35, entering their prime spending years? Or, was it the long-term decline in interest rates from 18% to 1% over two decades? Whatever the rationale, millions are now drowning in deep pool of debt.

I spend 500 hours per year in my car commuting on the Schuykill Expressway to and from work. In my spare time, I’ve calculated that I will spend at least a year of my life in traffic before I retire. While commuting at 5 mph on the Schuykill, I can’t help but survey the cars I’m sharing the road with. There are thousands jamming the highways in the Philadelphia area. There are 230 million cars in the U.S. and approximately 200 million drivers. We are a car crazed nation, with the number of cars per person 40% higher than Europe, 500% higher than China and 6,200% more than India. In 1970, when I was seven years old, the number of cars per 1,000 people was 529. Today it is 765, a 45% increase in three decades. Suburban dwellers have a love affair with their cars.

The average price of a new car exceeds $30,000 today. That is a nice chunk of change. I have a mental block paying that much money for an asset, that losses 20% of its value in the 1st year of ownership. My price limit is $20,000. I finance my cars over 4 years and try to get 10 years out of them. The 6 years of no payments goes directly into savings. My frugality regarding cars probably harks back to my father buying used cars during my entire childhood. Cars were a means of transportation, not a symbol of success. It appears to me that expensive luxury cars are an attempt at filling a psychological or emotional void in people’s lives. We spend half our lives in cubicles or offices and the other half in our shielded houses with gates and fences to keep people at a distance. The only time we are seen by others is on the highways and byways. An expensive sports car tells the world you are a success. A luxury car is a futile attempt at increasing your perceived happiness. Your fashion sense may be a little whack, but your car isn’t a piece of crap.

This brings me to the conundrum that has confounded me as I drive to work each day. There appears to be many more BMW and Mercedes vehicles on the road than people with enough income to own one of these vehicles. How can this be? I was befuddled. After a little research it became quite clear. The graphs below tell the whole sordid story. Borrow today, live like a Beverly Hills hotshot, roll the loan or lease into the next loan or lease in 3 years, and don’t be troubled about the future. According to the Federal Reserve, consumer non-revolving debt grew from $300 billion in 1980 to $1.6 trillion today. About $1 trilion of this is auto loans. The average automobile loan today is for 63 months, with some going as high as 84 months, compared with an average of less than 48 months in the early 1990s. In 1997 banks financed an average 89% of a new vehicle's price. The average loan amount was $17,000. In 2007 banks financed 101% of a new vehicle’s price, since consumers borrowed to cover the amount they were upside down on their trade-in. The average loan amount is now $29,000. A full 40% of all trade-ins involve upside-down car loans. The average American car “owner” is in debt up to their eyeballs and upside down on their loan, but at least they look like a million bucks in the eyes of their neighbors and co-workers. Looking marvelous is what passes for achievement today.

Complete big article-: http://www.marketoracle.co.uk/Article13294.html

George Bush said get out there and spend, after 911, we can't let the enemy win, that’s what he said. So Americans being the patriotic bunch we are, did as we were told.

 

[Sam Mcgee]

Quote from wildfirepow:


I spend 500 hours per year in my car commuting on the Schuykill Expressway to and from work. In my spare time, I’ve calculated that I will spend at least a year of my life in traffic before I retire.

The average price of a new car exceeds $30,000 today.

I don't mean to be offensive, just to point something out. You imply that Americans are wasting too much money on expensive cars.....what about yourself? You're wasting 500 hours a year commuting. If you value your time at $25 an hour, that's $12,500 a year. More than buying a new $30,000 car every three years.

Why don't you move to a nice apartment nearer to your job? I think home ownership is way over rated if that's your current situation. You end up spending way too much money and time on taxes, utilities and maintenance for a house. You tie up hundreds of thousands of capital that could be earning a positive return.

 

[Scataphagos]

Quote from Rickshaw Man:

George Bush said get out there and spend, after 911, we can't let the enemy win, that’s what he said. So Americans being the patriotic bunch we are, did as we were told.

"Enemy winning" is defined as "anything which crimps our borrow-and-spend lifestyle"... including taking the time to watch and reflect upon an attack on our country and the death of many of our citizens...

Bush was/is SUCH a Douche!