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Poor Lickle Innocents - Save Them From The Credit Monster

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Not often an article in a media outlet makes me swear out loud, but this one did.

No personal responsibility, no recognition of the damage such idiots do to everyone else by inflating bubbles, nothing but excuses.

F**K them. I hope they burn in debt hell.

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Maybe you are reading a different version to me, but it sounds pretty reasonable. If you can't see the truth in it, or acknowledge the fundamental truths in the piece then I am puzzled by your presence in this forum.

The sheer prevalence of aggressive and deeply effective marketing geared towards massive overconsumption on credit is astounding - as is the manner in which the combination of wage deflation, stuff inflation, and housing coats has stripped the purchasing power of the consumer to a point well below perceived traditional levels.

This is a concept repeated at least daily on this forum, and as been for almost the last decade. The more global mainstream media pick it up, the sooner we might get out of it.

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"... I had to make a certain amount of money to fit in"

" ... driven by aspirations they can't afford"

Blimey, do people really think like this!? How spineless!

Talk about first world problems! People really worth knowing and true friends are usually those at the bottom of the economic scale anyway.

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I like the way that though they identify housing as major cause of this the problem its blamed on their credit card debt. That about ignoring the f..king elephant in the room.

Edited by Blod

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The report financially stressed households owed an average of about $7000 on credit cards, $250,000 on mortgages, almost $100,000 on investment loans, $12,000 on personal loans and $18,000 on student loans.

:blink: Not having debt is the #1 way to improve your life, I'm surprised these airheads know how to tie their shoelaces.

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"... I had to make a certain amount of money to fit in"

" ... driven by aspirations they can't afford"

Blimey, do people really think like this!? How spineless!

Talk about first world problems! People really worth knowing and true friends are usually those at the bottom of the economic scale anyway.

you can pay your car tax in instalments.

yes, they can take your money, on easy terms, whether its PAYE, an agreement with Revenue if you cant manage it all, to mortgages and cars.

You only have to make the monthlies. Everything else is irrelevant...until it isnt.

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:blink: Not having debt is the #1 way to improve your life, I'm surprised these airheads know how to tie their shoelaces.

In some respects there is nothing wrong with debt, providing you don't over extend and you pay it off. The problems arise with over extension and the belief that future growth will pay it off. If you can't continue paying your debts with a reduction in your wages you are in trouble, this is why deflation cannot be allowed as too many people would be found to be naked with no possible hope of paying off the debt.

Also I should add, debt for productive investment is necessary, bad debt is for speculation and unrestrained consumption.

Edited by interestrateripoff

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In some respects there is nothing wrong with debt, providing you don't over extend and you pay it off. The problems arise with over extension and the belief that future growth will pay it off. If you can't continue paying your debts with a reduction in your wages you are in trouble, this is why deflation cannot be allowed as too many people would be found to be naked with no possible hope of paying off the debt.

Also I should add, debt for productive investment is necessary, bad debt is for speculation and unrestrained consumption.

All good points, but none of them address the specific point I made because not having those debts - good or bad - is still better than having them.

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What on earth does 'almost $100,000 on investment loans' mean? Is the average household running a hedge fund?

The day you pay off your debts it's like a weight lifts from your mind. Never a borrower or lender be.

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All good points, but none of them address the specific point I made because not having those debts - good or bad - is still better than having them.

Debt has been great for many home-owners.

You just don't want it as a house buyer at a toppy bubble price, when it becomes musical chairs for the exit, and owners are cutting prices, into a HPC (which so many people doubt can ever happen)... indeed so many reports about doubling values into the next decade or so.

You don't have to big debt as a house buyer at a toppy bubble price. No one is dragging anyone into the banks and forcing them to sign up for jumbo big mortgages. It's not other people's fault if buyers have HPI future spreadsheets in their minds, for profit, and hold some fantasy the banks are on their side to make sure they get hpi galore into the future.

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What on earth does 'almost $100,000 on investment loans' mean? Is the average household running a hedge fund?

The day you pay off your debts it's like a weight lifts from your mind. Never a borrower or lender be.

My bet would be BTL all spurned on by negative gearing

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All good points, but none of them address the specific point I made because not having those debts - good or bad - is still better than having them.

That's true- but it's also true that if everyone suddenly started paying off their debts tomorrow the economy would probably collapse- firstly because demand would drop and secondly because the money supply is created in part by people borrowing, so no borrowing means that the amount of money in the system declines leading to a decline in economic activity.

So in that sense debt is not a bug- it's a feature. Because of the way that our money is created by the banks we need people to take on debts simply in order to avoid the system grinding to a halt for lack of funds.

So perhaps the highly indebted are providing a vital social function? :D

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Maybe you are reading a different version to me, but it sounds pretty reasonable. If you can't see the truth in it, or acknowledge the fundamental truths in the piece then I am puzzled by your presence in this forum.

The sheer prevalence of aggressive and deeply effective marketing geared towards massive overconsumption on credit is astounding - as is the manner in which the combination of wage deflation, stuff inflation, and housing coats has stripped the purchasing power of the consumer to a point well below perceived traditional levels.

This is a concept repeated at least daily on this forum, and as been for almost the last decade. The more global mainstream media pick it up, the sooner we might get out of it.

I'm reading an article in which the danger of credit are highlighted, but no mention of personal responsibility made. "I have been here for seven years and in that time I have noticed a shift towards middle class clients who can't afford everyday expenses – they have no savings and no financial buffer in case of emergency,"

Lets rewrite that with less spin "I have been here for seven years and in that time I have noticed a shift towards middle class clients - who had plenty of high earning years - who through their own overspending can no longer afford everyday expenses. They have no savings and no financial buffer because they failed to resist the urge to spend."

I'm comfortably middle class. I could have stayed in Australia, got a ******off massive mortgage, big car loan, and private school for the kids. But I was honest enough to know that debt = pain so I moved to follow work overseas, giving up the comfy option, paid down debts as quick as possible, and saved like a *******. No designer suits or cufflinks here. No wine cellar. No lexus 4x4. Missing out on mates drinks every night, no footy games to go to, no beach 30 minutes away. I've sacrificed a lot to avoid massive debt. The debt I do have (mortgage) I have reduced by 54% in 11 months.

And so, yes, I have NO sympathy for the borrowers. They could have cut their cloth, but chose not to. The article is treating it like a thunderstorm out of nowhere, rather than the personal failure it is.

Oh, and the same people who overborrow also vote, in my experience, with no understanding of what the promises by LIBLAB really mean for the country. Stupidity squared.

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There is good debt and bad debt.....all debt for consumption is bad debt, good debt is debt that adds value like a home bought at the right price at the right time, a good business, you are the business, the security, the added value, with a viable business plan, to start no more than 50% debt, 50% cash investment......there are times when a down payment on a good business is a better down payment than overpriced bricks.

Life span average four score years.......borrow it, grow it, pay it down by middle age 50 to 60......last third of life to live debt free, meaning more freedom and better choices....... ;)

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That's true- but it's also true that if everyone suddenly started paying off their debts tomorrow the economy would probably collapse- firstly because demand would drop and secondly because the money supply is created in part by people borrowing, so no borrowing means that the amount of money in the system declines leading to a decline in economic activity.

So in that sense debt is not a bug- it's a feature. Because of the way that our money is created by the banks we need people to take on debts simply in order to avoid the system grinding to a halt for lack of funds.

So perhaps the highly indebted are providing a vital social function? :D

It would be impossible to pay off all debts tomorrow, money issued is debt as you say, and interest is added. So, there's more debt and interest than money. There always will be and the banks will always profit from making money out of nothing. We could have the government issue money but the banks wouldn't like that. I believe Kennedy was keen on that idea and look at what happened to him. But, if we did, it wouldn't have to be as debt. The gov. could just make £60 trillion appear and share it out equally, call it the new pound, and not print anymore (except replacing damaged notes). No more issuance, no more inflation, no more debt slaves, no more dodgy budgets. Probably some deflation at first, as the new pound couldn't be inflated away, but no interest charged or given (remember every new pound has been shared out, none for the banks to give as interest), so no carry trade/arbitrage for the city. They'd probably just forget sterling and trade in Euros, Dollars, Yen etc.

I know, a daft idea that will never become reality but it shows that we do not need debt, however much the banks protest that.

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It would be impossible to pay off all debts tomorrow, money issued is debt as you say, and interest is added. So, there's more debt and interest than money. There always will be and the banks will always profit from making money out of nothing. We could have the government issue money but the banks wouldn't like that. I believe Kennedy was keen on that idea and look at what happened to him. But, if we did, it wouldn't have to be as debt. The gov. could just make £60 trillion appear and share it out equally, call it the new pound, and not print anymore (except replacing damaged notes). No more issuance, no more inflation, no more debt slaves, no more dodgy budgets. Probably some deflation at first, as the new pound couldn't be inflated away, but no interest charged or given (remember every new pound has been shared out, none for the banks to give as interest), so no carry trade/arbitrage for the city. They'd probably just forget sterling and trade in Euros, Dollars, Yen etc.

I know, a daft idea that will never become reality but it shows that we do not need debt, however much the banks protest that.

No it should take up to two thirds of an average lifetime to repay individual debts, up to retirement.......but this will of course never happen if the amount of debt an individual takes on in the first third is so great in comparison to income and projected future realistic income......now you can see why inflation of wages plays such a big factor in the wealth and future wealth of a person.......what we are seeing is global low inflation, real falling wages and the good productivity growth.....excess in the wrong places and deficiency in other places......there is enough to go around except it is being filtered into the wrong places/hands.

It is all well and good pumping the QE into new loans but loans require incomes to pay them, like landlords need rents to make being a landlord viable....if you just got a helicopter and dropped the notes to the people for free money would become like monopoly money, would need a case full to buy a loaf of bread.....think this has been done before in other places before.

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It does seem crazy that the only solution excessive debt seems to be to create even more debt in the hope that this will create the growth needed to pay the debt back- but this is inherent in the way the system works.

The real joke is that the beneficiaries of QE are the same gamblers who took down the system in the first place, and they have no interest in growth- so instead of the long term investments in the real economy that we need we get speculation and carry trade games.

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All good points, but none of them address the specific point I made because not having those debts - good or bad - is still better than having them.

I think IRRO has

If I have debts over £300k but Assets of £2 million how does clearing those debts improve my life ? I have been in massive debt and not, the actual quality of my life was independent of that balance sheet position

My health, family, friends and general life balance had a much bigger impact

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There is good debt and bad debt.....all debt for consumption is bad debt, good debt is debt that adds value like a home bought at the right price at the right time, a good business, you are the business, the security, the added value, with a viable business plan, to start no more than 50% debt, 50% cash investment......there are times when a down payment on a good business is a better down payment than overpriced bricks.

Life span average four score years.......borrow it, grow it, pay it down by middle age 50 to 60......last third of life to live debt free, meaning more freedom and better choices....... ;)

good way of putting it

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That's true- but it's also true that if everyone suddenly started paying off their debts tomorrow the economy would probably collapse- firstly because demand would drop and secondly because the money supply is created in part by people borrowing, so no borrowing means that the amount of money in the system declines leading to a decline in economic activity.

So in that sense debt is not a bug- it's a feature. Because of the way that our money is created by the banks we need people to take on debts simply in order to avoid the system grinding to a halt for lack of funds.

So perhaps the highly indebted are providing a vital social function? :D

Or prices become cheaper, and those who can borrow, do borrow - against a market that has to sell for lower prices.

At least your attitude is more rounded than some who hand out excuses. On other threads, where they're saying ALL borrowing/debt is bad, and all borrowers paying these prices are w@nkers who are victims of w@nker-bankers... err they choose to borrow/pay these house prices; no one is dragging anyone into banks to pay 30% higher prices than just a few years ago, to set new peaks in Norwich at £500K+ for a house.

Not all debt is bad for the borrower; if some of us could go back in time to early 1980s.. would we not take out £30,000 mortgages on a home at £45,000.. or 1997 similar...? I'm waiting until house prices reflect better value, and the mortgage debt will be fair value 'good debt' to borrow toward buying a house, in my market view. There's nothing I can do against those buying at ever higher prices now.

It all comes down to what we're prepared to prices market participants are willing to pay, and what borrowing we're prepared to take on. Agree with your business approach too, but that also depends on the owner being able to position the business for profit (value alone doesn't mean anything), and for me anyway, a business which could be robust against wider downturns.

There is good debt and bad debt.....all debt for consumption is bad debt, good debt is debt that adds value like a home bought at the right price at the right time, a good business, you are the business, the security, the added value, with a viable business plan, to start no more than 50% debt, 50% cash investment......there are times when a down payment on a good business is a better down payment than overpriced bricks.

Life span average four score years.......borrow it, grow it, pay it down by middle age 50 to 60......last third of life to live debt free, meaning more freedom and better choices....... ;)

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Not often an article in a media outlet makes me swear out loud, but this one did.

No personal responsibility, no recognition of the damage such idiots do to everyone else by inflating bubbles, nothing but excuses.

F**K them. I hope they burn in debt hell.

If anyone wants to go to the source and read the report, it is here

http://www.wesleymission.org.au/assets/Document/Our-words/The-Wesley-Report/The-Wesley-Report-14-May-2015.pdf

It's 72 pages.

Edited by 200p

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If anyone wants to go to the source and read the report, it is here

http://www.wesleymission.org.au/assets/Document/Our-words/The-Wesley-Report/The-Wesley-Report-14-May-2015.pdf

It's 72 pages.

The policy recommendations on p42 of the report suggest more financial education, and counselling. Now if anyone has read Rich Dad Poor Dad, there is an institutionalised neglect for financial education (and it is worse than that in his more recent conspiracy of the rich book - and you can pick up these books for a couple of quid). Change will never happen. Big business need people to take on debt, to be on the treadmill, the rat race. We want a nation of debt slaves, how else can receiver of debt interest prosper? A debt is an asset to the receiver of the interest. An asset puts money in your pocket, a liability takes money away. The bigger the debt, the bigger someone else's piggy bank.

In a world where the fishermen are in control, would they seriously invest in time and money telling the fish not to bite the bait?

And so it will carry on... first world problem? No, it is a system where some people profit, and some believe they are empowered in their social circles by the debt so they can have a big house and a new car.The information is out there, you just have to choose between the blue or the red pill.

2012-Audi-A7-300x200.jpg

You know you want me, I can make your dreams come true....

Edited by 200p

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