Comments on: Stress test the consumer

By: B.Free

B.Free — Thu, 09 Jul 2009 17:32:09 +0000

Unfortunately, today we face the effects. Jobs are being lost. What was once a two income household is now a one or no income household? Granted many of us have borrowed against future income and now it is difficult or impossible to repay that loan. Many will make mortgage and car payment while buying food and what clothing is necessary and the rest will go by the wayside. The rest will just hope they don’t take home and car to soon. It is sad.

Now for anyone to state that Gas prices didn’t contribute to the collapse get off you bicycle and try driving to work. I would love to get off of gas and onto a better more economical and efficient mode of transportation but the auto industry has done nothing since the last oil crisis in the 70s to bring the internal combustion engine to its fullest potential or put out a viable alternative to the gas guzzlers. What do they give us but toy cars like the Volt and crap like the hybrid? No we should not have bailed out the auto industry. They have brought this debacle unto themselves. I would have loved to see new blood come out and take over our auto industry.

The consumer is always the ultimate payer. We pay while our voice is silent in Congress. We pay while CEOs are paid 100 times their worth. We pay as our retirement funds are slashed in half and our government does absolutely nothing to bail us out. You could run a consumer stress test but, we would fail.

By: bloke nouvo

bloke nouvo — Wed, 08 Jul 2009 03:25:23 +0000

What about the don’t wants ?

By: Sergey

Sergey — Tue, 07 Jul 2009 14:25:12 +0000

There are several fundamentally wrong things:

1. We cannot borrow our way out of debts. US is addicted to unsustainable way of life. People consume more than they can afford and cover deficit by borrowing against future income and assets. Finally we exhausted all reserves and… Government jumps in borrowing on our behalf put us as nation deeper into debts.

2. US pumps money to people/institutions who just prove that they cannot manage their money. At the same time government is taxing people who have proved that they can manage money.

3. US didn’t charge people who were at root of wrong decisions that affected whole society (AIG/Citi/Lehman/Bear/etc).

4. Gov overlooked second cause behind recent problems - Failing corporate governance. CEOs have heavy sway over corporate boards and rule unchecked. Instead of persuade interests of shareholders and public they play power brokers between unions/board/politicians and pocket unjustified compensations.

5. I am 39. There is no way current system can provide me with decent retirement.

By: Matthew

Matthew — Tue, 07 Jul 2009 13:54:52 +0000

Naughty bankers may have exploited people who wanted to borrow more than they could afford to pay back, but that doesn’t absolve the people concerned from blame, nor, more importantly, does it get governments off the hook. For a generation now, governments have encouraged profligate borrowing because it allows them to claim that we’re all so much better off. What we’ve seen recently in the UK is the most extreme form of this: banks going under because of foolish lending and borrowing, introduced stringent conditions for new mortgages (25% deposit and so on). Very sensible on the face of it. NO! The government virtually ordered them to lend more! You couldn’t make this stuff up. We’re all in Never-never-land.

By: Elyse

Elyse — Tue, 07 Jul 2009 13:19:20 +0000

The sad fact is that the government’s stupidity, and the banking industry’s greed (well, everybody’s greed) has put us in this mess. Capitalism at its worst. Bank should never have given out loans to people who couldn’t afford to pay them back. It was insane. The trouble is that the idiots are now dragging everybody down with them. The banking industry across the globe should the same strict regulations (well, let’s hope they get some!). Alas, I see a lousy economic forecast ahead for the next several decades.

By: Mr. Anderson

Mr. Anderson — Tue, 07 Jul 2009 12:35:46 +0000

The consumer is already stressed tested and now the bottom is falling out as this depression will be agrrevated by the government trying to bail us out with trillions of $$$’s………All the printed dollars that are piling up have no where to go (velocity) to get into the system if the jobless will not take out loans and start spending……I see DEFLATION Japanese style…America will feel this pain for decades….. for the Japanese are still able to go through this period because of individual savings…..American’s are just starting to save……It’s too late!!!

By: Myfanwy

Myfanwy — Tue, 07 Jul 2009 08:48:45 +0000

What a lot of interesting comments - things in the UK are almost exactly the same - what a nightmare mess. People here were also sucked into living way beyond their means thinking their increasing house value would pay off their debts. The wickedness of the “city banker boys” no doubt saw them as fat stupid birds for the plucking and our Government let it go on because they were getting loads of tax revenue from the city spivs’ bonuses to squander on “public services”. It ain’t pretty - beam me up Scottie - if only!

By: alice

alice — Tue, 07 Jul 2009 05:10:44 +0000

Oil companies are at it again - today I paid over $3/gallon. Auto companies deserve to go out of business if they can’t serve consumer interests by making alternative fueled cars, instead of serving big oil which we all know is going to dry up before long. Efficiency of the workforce has increased exponentially due to technological advances and the profit has gone only to those at the top. Wages for working people hve not increased in the last 25 years. Even though their contribution is creating much greater profits, their buying power is greatly diminished since the price of everything has also increased exponentially - especially the cost of owning one’s own home - a basic necessity. When did consumers become the enemy to be sucked dry? Last I knew, we were a country of, by and for ‘the people’ - it seems we’ve become a country divided into the 1. Haves who want to scam even more away from everybody else; 2. Co-Dependents of the Haves who create the legislation or fail to enforce the law that allows the Haves profit from scamming everyone else; 3. Everyone else who still believe that we’re “one nation” seeking truth, justice and a peaceful, prosperous way of life for all… 4th of July celebrates our independence from exactly this kind of tyranny…what in the world has happened to America?!

By: Gregman2

Gregman2 — Tue, 07 Jul 2009 03:51:15 +0000

“There are several potential mishaps that could swiftly undermine consumer spending and set the recovery back to square one.” Chris, I think you’re a little late to notice, but the situation is already at a crisis stage. There’s no real recovery happening, and in case you hadn’t noticed, poor folks have been subsidizing the rich for a very long time. See: http://www.debtdeflation.com/blogs/

By: Ian

Ian — Tue, 07 Jul 2009 01:07:48 +0000

I knew this was coming, many people would buy second homes in the Southern United States, West coast, locals made lots of money on dumb people, most wealth now is most southern states.

The young generation are much more aware, the 1980’s 1990’s generation is the Spend Generation. Most people in their 20-30 are better off then their parents. Most forclosed homes are people that are 45-50-60.