It absolutely amazes me to read some of the comments from trolls on this blog - mocking people for saving, for being frugal, for clipping coupons, for driving 5-year-old cars, for living within their means, for buying things with cash versus credit.
What's happened to our world where 20 year olds live in McMansions and drive Mercedes cars, while making $50,000 a year? How screwed up are we when people rack up insane amounts of debt in order to look successful, when it's so obvious that the only thing they've been successful with is acquiring debt?
The Great Unwinding is also going to be The Great Smack Your Ass and Wake You Up for Generations X and Y. You work your way up in this life, you don't magically just get there without work and without making a decent living (unless your parents are rich of course).
A generation of spend spend spend, me me me, fake fake fake will now learn learn learn. And the credit crunch will be the catalyst.
Just ask any senior about how their grandkids are carrying on with their big houses, big cars, big TVs, and big debt loads - you're likely to get the same answer, "I don't know how they pay for all of that".
Well, they don't pay for a lot of it.
Never before has credit flowed so freely and never before has so much debt accumulated. Never before has it been easier to buy a house. That is, if you don't mind non-traditional mortgage products where no money down is needed and not only can you avoid paying down the principle (interest-only), but you don't even have to pay all the interest due (pay-option).
Of course, as a long-term plan, this looks like it may not work out so well now that housing prices are falling and subprime lenders are falling even faster.
The younger set has been fearless when it comes to taking on new debt over the last ten years. This is likely to change in the next ten years - all part of the Alan Greenspan legacy.
It's too bad that Lemming suicide is a myth - it would have provided a fine analogy for the headlong rush by youngsters toward the dream of homeownership and sure riches. The trouble is that nontraditional mortgage products, subprime lending, short sales, and foreclosures are no myths.
Will single people start asking prospective partners what their "mortgage status" is before considering whether or not to date them? Shouldn't they?
Is the social stigma of "owning" a home (renting money from a bank in order to sleep in a rapidly depreciating asset) now worse than renting?
It absolutely amazes me to read some of the comments from trolls on this blog - mocking people for saving, for being frugal, for clipping coupons, for driving 5-year-old cars, for living within their means, for buying things with cash versus credit.
