Quote:
Originally Posted by dreadgeek
Dean:
I get what you're saying and I'm wrestling with this myself because my wife and I are not buying on credit and we've basically decided that if we can't save up for it, we don't need it. On the other hand, certain industries--and here I'm thinking about the computer industry--is predicated on a certain amount of 'churn'. Let's say that people took your advice and stopped buying the latest computer. That means that Dell, Apple and HP won't need as many employees so they'll lay them off. That means that the software vendors won't need as many employees so they'll lay *them* off. If everyone closes up their pockets and buys only the necessities then I think the economy will get worse, not better. It may not be the way we want it to be but I fear that whether we would prefer it, this is the economy we have to start with and make changes to that system.
I would like to see more emphasis on thrift and delayed gratification on the consumer side and a return to slow-and-steady growth on the business side. I would like to see businesspeople once again use, as one metric of success, hiring people instead of it being seen as, at best, an inconvenience to have a larger payroll this year than last.
Cheers
Aj
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The upper 10% of income earners have a much smaller debt burden relative to income and net worth. Those people should have ample spending power to help fuel an economic recovery.
The data in 2007 stipulated that low income families I made up 40% of the population and just 12% of consumption. Middle class, 50% of the population and 46% of the consumption. Wealthy 10% made up 42% of the consumption.
The figures might have change somewhat, but the reality is the rich can afford to consume enough to make up for the rest of us slowing down a bit considering what's been happening. Hell I bet they prefer to spend to help economic recovery more than they would like to pay more taxes. They could just take one for the team.