Apr 20, 2010
By: Justice_Litle
More evidence has arisen that the "strategic default" consumer spending thesis is correct - and that the economic recovery on the whole is based on a rotten sham.The economic "recovery" we are now witnessing is based on theft, greed and deceit. It's a giant rip-off, a rotten sham. In this sleazy imitation of a free market economy, liars, cheats and deadbeats are the ones getting rewarded
And as for the savers, the hard workers, the ones who chose to honor their debts and live within their means? Nothing but a bunch of suckers. (They're the ones paying for it all.)
If you're one of those "suckers," at least you've got company. I'm a sucker too.
All this time, I thought working hard for my money and staying debt free was wise. I thought sticking with one credit card - paying down the balance every month, no exceptions - was prudent. I thought driving a five-year-old car - fully paid off, nothing flashy - was a sensible thing to do.
Nope. Turns out those were sucker moves. What I should have done, to be in synch with this economy, was to have bought a 3,000-square-foot McMansion at the peak of the bubble... pulled out a cool hundred thousand in home equity loans... and then defaulted on the place.
That way I could have had the cash for a jet ski and a new convertible and a Hawaiian vacation - you know, the means of living in style - without having to worry about a thing.
No Morals Is the New Normal
Apologies for my cranky tone today. I hope I'm not messing up your Monday. It's just that, heading into the weekend, I read something that absolutely made me sick. More on that in a moment...
Two weeks ago your humble editor asked, "Did the Housing Bust Fuel the Consumer Spending Binge?" In that piece, it was explained step by step how the phenomenon of "strategic defaults," i.e. homeowners walking away from their mortgages, may have fueled a surge in retail spending by way of freeing up cash.
As it turns out, it looks like the strategic default thesis was correct. And this helps show why those who were expecting a "new normal" got it wrong.
Full article HERE
