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Wednesday, March 13, 2013

Profiting off the Populace to Bolster the Economy

As we've written extensively, this nation survives and thrives economically by one thing and one thing only...

Debt load.

It took from 1789 until 1980 to compile $1 Trillion in National Debt, which is 191 years.

Its taken 33 more years (1980-2013) to push it to over $16 Trillion.

And as horrible a figure as it is, that is how this nation survives and gives the illusion its thriving-- by spending and spending on this program and that war, and keeping everyone working (who is still holding employment)

Think of spinning plates... Same theory with debt..

Economy Must expand.. Circulating dollars.. Must keep spinning!

Now more specifically, this nation is also utterly and completely dependent upon personal debt in order to exist....

Your personal debts-- your mortgage payments, car loans, the student loans, credit cards, etc..  without it, the entire US economy collapses upon itself.

Debt to one means profits to others and from those profits come building rent, salaries, electric and utility bills, purchasing of large amounts of office supplies and electronic equipment, etc..

And those entities who sell more have more profit to pay their bills and employee salaries, and on and on..

And when people can't pay anymore, there's plenty of bottom-feeder professions that profit off that-- the bankruptcy lawyers and court system in itself, people in real estate like the brokers and appraisers, and on and on..

We wrote two detailed posts on this a while ago explaining how many jobs would be lost if everyone magically could repay their debts in full and be in the fiscal black.

Click:  'The Big Business of Economic Suffering' -- 2/7/12

Click:  'How You Being In Debt Drives US Economy' -- 2/8/11

So, OK-- you're a nation in economic small-d depression but your ego is too big to admit it and the ruse of a manipulatively high stock market is going to wear off eventually...  So what's stage 2?

Simple:  Weaken credit score criteria so those with poor scores presently denied loans will enjoy greater access to new credit i.e. debt accumulation, and all the horrible personal consequences of before..

But of course the media spins this concept as a positive...
"FICO's chief competitor introduced a new credit score Tuesday that captures up to 30 million more people that otherwise couldn't be scored by conventional credit scores.

The VantageScore 3.0 can create a score for a so-called thin file consumer by considering accounts at least 1 month old, factoring in nonaccount data such as collections, inquiries or public records, and counting accounts that are more than 2 years old." (

Oh goodie...

"VantageScore's new model will also weigh rent and utility payment records, and public records like bankruptcies for people with very limited credit histories...  FICO announced Monday that it will begin looking into ways of factoring in alternative records to calculate scores for those without -- or with limited -- credit files"  (CNN/Money)

Remember-- without people, particularly the poor and uneducated getting into heavy amounts of personal debt, this economy contracts then collapses.

The poor think in the 'now'.. the immediate and they want that access to credit so they're quite happy to get it without worry of the consequences of tomorrow...
And as long as mechanisms are in place where others can profit off every step of the downfall into bankruptcy, foreclosure and eviction, there's zero motivation to change course.

This was the mindset a decade or so ago when President Bush pushed into law easier access for people to acquire mortgages for housing, especially first time borrowers.

Credit history.. employment.. personal savings.. all didn't mean much because as long as the suckers put their signature on the line, there were many, many others prepared to profit whether Mr or Ms Adams could pay their mortgages or not...

Student loans are the same way..

You don't have to hold a job or own even an automobile much less a piece of property... don't need a parent or other adult to co-sign.. Nope, just be eighteen, doe-eyed and naively stupid that a degree matters, and you will receive 10's of thousands of dollars in indebtedness before you are old enough to legally drink
"I'm going to college.. No idea why.. No idea what my major is.. but.. I'm 18 and supposed to go, right?  Oh well... la la la"

That's how this terrible nation functions..  and yes, it is a terrible nation when the parameters are set up where they only way a person can survive and have any hope of a decent quality of life outside of inheritance is through debt acquisition.

More and more and more of it...

If you are angry with things are... If you want to be a true rebel and spiritually middle-finger the System that's in place, then live as debt free as humanly possible.. Don't allow others to profit off you more than one absolutely must put up with...

Learn to be content with what you have and if you want/need something different, learn to be a good shopper.. a smart shopper...
Time is money.   The more time you waste making the money to re-pay debts, the less time you have to do anything in life that is actually important and meaningful...

And life is short..   Money.. cheap as the paper printed.