Lead us not into temptation

Last week was a very interesting one on Capitol Hill. The former Federal Reserve Bank Chairman, Alan Greenspan was in the hot seat, being grilled (slowly, and over an open flame) by a Congressional Oversight Committee on the economy and the role he played in the credit crisis. I still get a chuckle out of his comments that “we are in the midst of a once-in-a-lifetime credit tsunami,” and that he was “shocked” about the outcome, insisting that "I still do not understand exactly how it happened."

Guess what? As it turns out, I realize now that I am way smarter than Alan Greenspan. Really, no fooling. I predicted this mess was going to happen, sooner than later. Not that I did anything about it, of course. I mean, what do I know? If no one else was worried, why should I be? I’m not an economist, after all.

And another thing, not only am I smarter, but I’m a bigger man (figuratively speaking, of course) -- I accept my share of the blame in this economic debacle. My bad. I couldn’t help myself. I’m only human.

The temptation was just too much for me. Sure, deep down in my heart, I knew that I didn’t need any more debt – I was okay with my house, the one car and the few credit cards in my wallet. But the advertisements and the marketing was just so compelling? With the interest rates at an all time low, and the loose terms were so darn attractive, how could I (or anyone else, for that matter) pass them up?

It’s like this: If you put a kid in a candy store and tell him he can take as much as he wants, and all he’s got to pay you is a nickel a day for the next month, is he going to ask himself, “Do I really need this candy?” or “Where am I gonna get a nickel a day from every day?” Heck no. He’s gonna cram that candy into every pocket that he can, till they’re overflowing. He’s going to shove that candy down his own throat until he’s sick. He may or may not worry about where he’s going to get that nickel from to pay you back tomorrow (and the next day and the next day). But for now, he’s gonna enjoy that candy.

It’s basically the same thing with the economy, which is driven largely by consumer spending. We were tempted (not by the devil, but close -- it’s called a bank) and we gave in to that temptation. It’s as simple as that. I have to admit, I loved the bigger house, the second car and the freedom to purchase whatever I wanted with all of that credit. It was nice while it lasted.

But now, like the kid rolling on the floor clutching his aching stomach, we’re paying the price for our overindulgence. That price is too much debt, and that’s really a pretty significant cost. The real problem is a spoonful of Pepto Bismol isn’t going to cure this ache. Like too much candy, too much debt has a way of putting a serious hurt on you. If you want to show us where it hurts, then contact us, and make an appointment with a DebtStoppers attorney, and we’ll help make the pain go away for good.

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