Inflation & the dollar
Inflation worries me. (I just paid $2.50 for 18 eggs, when they were under $2 last month. At this rate I might start thinking about raising chickens in my rock-covered suburban backyard.)
The huge amount of debt that the United States has worries me. Those of us who are or have been in debt know what it’s like to be beholden to someone. There’s a pressure, a sense of weariness even, when your money is not your own. I’m no policy-maker, but I do have experience with debt, and I don’t think that owing more than you could possibly pay back is in any way a good idea. Especially when you owe the money to people that don’t have your best interests in mind.
And what about the dollar? It affected me personally this summer when we went on vacation. At $1.40-something for every Euro, even the little things were awfully expensive. I don’t know about you, but I don’t normally pay almost $5 for a single bottle of water. (Luckily there were plenty of fountains to refill in for free.) I suspect that people in Europe still think of Americans as rich. Most of us aren’t rich — we just spend a lot of money that we don’t have. Even rock stars sing about needing “a credit card that’s got no limit” as part of the trappings of fame. What does that say about us? When your money is worth less & less, prices increase more and more, and salaries stay flat — that’s just not a good thing. What could we as individuals do to improve things?
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September 26th, 2007 at 10:43 am
Yes Europeans think that Americans are rich because you have so much stuff.
Compared to the UK, the cost of living is lower and salaries are higher. If you aren’t all rich, you only have yourselves to blame. :D
September 26th, 2007 at 11:33 am
We were in France when the housing market officially “burst.” French headlines announced America’s Black Friday, and every morning news show provided graphs and statistics on what is going on with our economy. I came back expecting everyone to be at least slightly panicked, but hardly anyone in America seems to be aware of the disaster Europeans were outlining for us.
September 26th, 2007 at 12:52 pm
I agree that in general we do have a lot of stuff, most of which is crap. Of course that is our own fault. I think the U.S. government and many, many individual Americans have made a huge number of very poor decisions in a lot of areas. I’m not surprised at all by the lack of awareness of impending (and current!) problems.
But rich isn’t having a bunch of crap. Rich isn’t when your highest salary from shortly after 9/11 up until a few months ago was $32,000 a year (which is what, £15,888 or €22,857?) and that’s when you WERE employed. Is that a normal salary in the UK or Europe? I have no idea.
But I know many, many people that are in the $32-$40K range here — in a medium COL area. And many of them haven’t seen a single COL adjustment in years. Of course, there are other people who make $100,000 a year or more. They just aren’t the majority of people that I know.
I just feel like we need to be personally responsible for the state of things — because if we don’t feel that sense of responsibility, we also won’t feel empowered to help change things. And things need to change.
September 28th, 2007 at 7:27 pm
The good news is that the type of inflation you’re talking about is very temporary. Wage increases are what fuel inflation, and if wages don’t rise, eventually, prices cannot rise either. Yes, people can borrow, but eventually, they can’t pay their debts — it’s an unsustainable model. Prices have to come down.
But the thing is, inflation is not bad at all right now. You can’t pick out one item, eggs, and declare there’s runaway inflation. Look at the price of microprocessors. Yeah, you can’t eat microprocessors, I know, but they are cheaper and cheaper every year — as are a lot of items. Food and energy are notoriously volatile.
Of course, this is not to say there isn’t a problem — only that if you think things are bad now, they’re probably going to get a whole lot worse before they get better. The Fed is cutting interest rates, throwing more gasoline on the fire, and exacerbating inflation. The administration is talking about bailing out subprime lenders and borrowers, which completely degrades the dollar. What can we do? We can demand better leadership from our elected officials. Lower taxes, less regulation, an end to corporate welfare and deficit spending, etc. There is one candidate for president who has made these issues part of his platform. His name is Ron Paul.
September 29th, 2007 at 3:00 pm
And we all just wanna be big rock stars….
:)