Credit is tighter now than it has been in many years. According to Barrons, credit on home loans, business loans, and credit cards is getting more difficult to get. Too many people were getting cheap, simple credit and then wondering why they couldn’t pay their bills. Americans have become addicted to consumer credit.
When banks began offering 100% mortgages, I predicted that this tactic would cause problems if someone tried to sell a home at less than its loan value. Guess waare getting too many credit cards. We baby boomers remember when there were few credit cards available, and certainly no debit cards. We had to GASP! pay CASH! OMG!
It’s time for everyone to start lessening their expectations. Do we really need all that credit? Does everyone have to have that bigger vehicle? more massive house? newer everything? A tiny fiscal restraint would be a welcome change from our current pattern of “conspicuous consumption.”
Tags: baby boomers, Fannie Mae, Freddie Mac, mortgage financing, small businesses, subprime crisis
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