Remember the days when you had to save up to buy something ?
Prices.... Going Up!!!
- Thread starter musichal
- Start date
And stores had a lay-a-way option.
All that has shifted to the "Credit card" model of doing business.
Now you "save" by having an acceptable credit rating.
Mystic
We're all born mad
Somewhat counter to this sentiment of "rampant~runaway" revolving credit reliance among consumers, at least in USA revolving credit card balances have, for the most part, since 2021 been paid in full @ the end of each monthly billing cycle. So cobsistently that economists are coming to understand and measure credit card balances as more a measure of spending, than of borrowing.
A couple of graphic representations tell the story.
1. CREDIT CARD BALANCES AS % OF TOTAL CONSUMER DEBT (Q1/2003 - Q3/2022)
Source: New York Federal Reserve Bank
2. CREDIT CARD BALANCES AS % OF DISPOSABLE INCOME (Q1/2003 - Q3/2022)
Source: New York Federal Reserve Bank
A Theoretical Conclusion
The stimulus monies distributed to consumers during the pandemic – stimulus checks, PPP loans, extra unemployment benefits, etc. – plus the monies that consumers didn’t have to pay, e.g., mortgage and rental forbearance, eviction bans, etc., left consumers with excess liquidity, and it seems that many who had fallen behind on their credit cards paid off their balances, while other consumers were able to enter their credit card arrearage into forbearance programs, and thus see their delinquent balances flagged as being “current.”
A Prediction
However, since credit card arrearage ended as of Q3/2022, it is expected that credit card balances that are transitioning into delinquency – i.e., accounts that are 30 days or longer past due – will resume accrual of interest penalty immediately and through the next year. In fact, the accrual of interest since the end of Q2/2022 has already begun: as of this point in Q4/2022 (i.e., late November), the average credit card balance among American consumers has increased to 5.2% of total household debt, putting it at around the same level as it was at the end of Q4/2016. Absent another massive & universal household-level "stimulus" payment accompanied by additional moratoria on debt servicing transfers to creditors (e.g., landlords, loanmakers, etc.), credit card balances as a % of total consumer debt and disposable income will rise much higher throughout 2023 and beyond.
And so it goes.
cc: @BillyTheKid @rickb119
bluesky
Lunatic Member
Yeah, now you just don't buy it. It's 'broken brand new' anyway. It's hard to find anything that works right anymore.
Remember when things worked right?
Got a new pair of Craftsman pliers from Lowes 2 weeks ago, I lost my real pair.
Well, I found my real pair of USA Craftsman. They make the 'new' Chinese Craftsman pair look and feel like PURE JUNK. They don't even feel right. Bought a new Craftsman Blower a month ago. The entire filter assembly fell off the motor. Where??? Who the F knows.????????????
I'm fed up with it all.
Don't even buy a new Whirlpool refrigerator!!!!!!!!!!!!!!!!!!!!!!!!!!!!!! Just - don't - do - it !!!!!!!!!
After I screamed for 2 weeks they finally took it back. What a NOISE MACHINE that was, hideous non-stop LOUD noise. So loud that you could hear it 40 feet away in the garage!
It goes on and on and on. I'm tired now. It's not enjoyable trying to fix any of this Chinese junk.
Want something quality?
Go to the Goodwill, Salvation Army, Garage sales, and estate sales. THEY have the 'real thing', like new, and dirt cheap too - almost like... Free.
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Bought a new speedqueen washer and dryer other than cost real happy with the quality and old school construction and yes it has a real agitator ! Cost twice what big box store junk cheap set does, but has a 5 yr warrantee !
I grab every old-school slip joint pliers that I can find. Some are incredibly well made..so much that you can actually use them for their intended purpose. They're usually $1 or free.
bluesky
Lunatic Member
I hear ya.
Picked up a pair of 'like new - perfect ' shiny old USA Craftsman channel locks for $1 at a garage sale !
Excellent score really. Now I have 2 pairs. Perfect.
or the occasional "Snap On" tool
I read somewhere recently that when polled, people would pay up to twice the price for something if it would only work and last.
My shop is filled with old tools.
Most of my powered woodworking tools were purchased used and made in the US.
The snowblower that I purchased in 1979 for $500 (a lot of money then) still works great.
I believe that I also read that in Germany, a product is engineered and then priced.
In the US, we engineer to hit a price point.
Just random points.
I dread buying something new.
My shop is filled with old tools.
Most of my powered woodworking tools were purchased used and made in the US.
The snowblower that I purchased in 1979 for $500 (a lot of money then) still works great.
I believe that I also read that in Germany, a product is engineered and then priced.
In the US, we engineer to hit a price point.
Just random points.
I dread buying something new.
Mystic
We're all born mad
AMERICANS CONTINUE TO OUTSPEND ... INFLATION.
Americans, still (seemingly) flush with pandemic cash from federal and/or states that are issuing inflation checks and whatnot, getting big pay increases and/or pay rises when job hopping in the continued (huge) labor demand, and /or still sitting on all kinds of capital gains -- real or imagined -- are still outspending inflation.
Which determines that prices for most goods and services will remain "inflated".
REAL CONSUMER SPENDING (Trillion $ / Seasonally adjusted) Q1/2016 > Q3/2022
Source: Bureau Of Economic Analysis / U.S. Department Of Labor
Americans, still (seemingly) flush with pandemic cash from federal and/or states that are issuing inflation checks and whatnot, getting big pay increases and/or pay rises when job hopping in the continued (huge) labor demand, and /or still sitting on all kinds of capital gains -- real or imagined -- are still outspending inflation.
Which determines that prices for most goods and services will remain "inflated".
REAL CONSUMER SPENDING (Trillion $ / Seasonally adjusted) Q1/2016 > Q3/2022
Source: Bureau Of Economic Analysis / U.S. Department Of Labor
I gotta say, I'm a bit baffled at the effect of all the stimulus money and maybe I'm not paying enough attention to understand.
What the heck is an inflation check?
I know that as an "essential worker" for a school district in Iowa, I didn't get crap for extra money.
And as I understand it, the majority of the stimulus money is just now hitting the economy - for example the CDC just released $3B of stimulus money to the states for healthcare infrastructure.
What the heck is an inflation check?
I know that as an "essential worker" for a school district in Iowa, I didn't get crap for extra money.
And as I understand it, the majority of the stimulus money is just now hitting the economy - for example the CDC just released $3B of stimulus money to the states for healthcare infrastructure.
Erik Tracy
Everyone's happy when the wizard walks by
November reports show inflation has gone down a teeny bit, but still rising at 7.8% (over a 12 month period). And jobs are still strong - so the Fed is expected to keep with more rate hikes to 'destroy demand.' Inflation continues...for now.
DesertRatt
All Bark, No Bite!
The tools the FED has to manage the economy are 100 years old. Today's economy compared to the 1913 economy is like comparing a Tesla to a Model T. Asking the FED to tame inflation but not crash the economy is like asking a man with an ax and wedge to build a fine dining table out of some fallen oak trees. Precious little of our economy operates under any kind of "command and control" concept. Considering the many thousands of entities that can "create money," and considering the vast array of securities and derivatives that can be created, and considering the thousands of cryptocurrencies in existence, and considering the free movement of capital around the globe, and considering the arbitrary enforcement of various "sanctions" on crucial energy products in particular, and the nested intertangling of the economies of 190 other countries with ours, the concept of "whipping inflation" by fooling around with interest rates is patently absurd.
Inflation will eventually cool, just like any wind eventually dies down. Just like a rainstorm eventually stops. Just like a hurricane eventually blows itself out. I suppose the FED will take credit for it, and the nonsense will continue in the future the next time an inflation storm arises.
Inflation will eventually cool, just like any wind eventually dies down. Just like a rainstorm eventually stops. Just like a hurricane eventually blows itself out. I suppose the FED will take credit for it, and the nonsense will continue in the future the next time an inflation storm arises.
Mystic
We're all born mad
Or: The Fed simply needs to increase QT to $100B monthly, starting now until ________.
Mystic
We're all born mad
I agree: There's gonna be a landing, a natural one, but it ain't likely to be, um, soft.
I dunno could bee wrong but seems to me key to getting inflation stabilized would be to stop printing money we dont have.
