Guest Post: The Decline Of The American Saver And The Economy

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Tue, 03/29/2011 - 14:33 | 1113640 Mr Lennon Hendrix
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Buy silver!

Tue, 03/29/2011 - 14:35 | 1113643 tekhneek
tekhneek's picture

buy guns.

Tue, 03/29/2011 - 14:36 | 1113655 Long-John-Silver
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I did that long ago.

Tue, 03/29/2011 - 14:39 | 1113661 TIMMAYYY
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buy a ticket outta there...nice knowing you america,

You wouldn't think so judging by the media image they pump around the world about what america is like.

Tue, 03/29/2011 - 14:44 | 1113680 Mr Lennon Hendrix
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In the game of 'who sucks the least', we are all kings and queens.

Tue, 03/29/2011 - 14:59 | 1113743 Sudden Debt
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queens as in gay?

 

Tue, 03/29/2011 - 14:47 | 1113714 breezer1
Tue, 03/29/2011 - 14:41 | 1113669 Mr Lennon Hendrix
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Plenty of guns.  Not that much silver.  I am sticking with the catch phrase I came up with.

Tue, 03/29/2011 - 15:40 | 1113919 AcidRastaHead
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Buy silver guns!

Tue, 03/29/2011 - 14:38 | 1113666 unwashedmass
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yeah, and then, there's the bunch of us so terrified by what Ben is doing that we've taken out wealth out of the system and put it into gold and land....

Tue, 03/29/2011 - 14:44 | 1113694 impending doom
impending doom's picture

Is silver a productive asset?

Tue, 03/29/2011 - 14:47 | 1113715 Mr Lennon Hendrix
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Does the Pope dress up like a liberty cap mushroom?

Tue, 03/29/2011 - 14:58 | 1113749 Sudden Debt
Sudden Debt's picture

can you handle the truth?

 

Tue, 03/29/2011 - 15:33 | 1113897 depression
depression's picture

NO, I wouldn't know the truth if it stepped on my foot.

My daily meditation is: Shoot first and ask questions later.

Tue, 03/29/2011 - 21:03 | 1115183 francis_sawyer
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Does this sound like a Geico commercial?

Tue, 03/29/2011 - 21:29 | 1115235 TBT or not TBT
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Does a doomer meme collect no moss?

Tue, 03/29/2011 - 15:43 | 1113937 MX_DOGG
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Man I hope this site doesn't get bought. just sayin..

Tue, 03/29/2011 - 14:37 | 1113651 Long-John-Silver
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I convert my FRN's to physical Gold and Silver as soon as I get them no matter the current price. Am I the problem?

Tue, 03/29/2011 - 15:58 | 1113996 Strider52
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No wonder personal spending is up. Gas and food cost a lot more nowadays.

 I just bought a silver (and black) gun. I already have silver & gold, plenty of canned food, bought at 1/2 the current price. Hey, does that make stored food an inflation-hedge?  Now I gotta go get 10-20 of those monster plastic water bottles.

Tue, 03/29/2011 - 17:56 | 1114612 RafterManFMJ
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I buy sardines by the 12 pack on Amazon. In Olive Oil. MMmmm. Bought 3 packs last year for 19.95 per, and just got on last night to buy some more. On Aug. 17 of last year, I paid 19.69. Today, they are 28.73. Holy Smokes! I can no longer afford sardines, probably to my co-workers delight.

 

Tue, 03/29/2011 - 18:37 | 1114755 Mr Anderson
Mr Anderson's picture

Do you live in a rural area as well?

Do you have a well?

The easiest prepartion is location.

 

Tue, 03/29/2011 - 21:33 | 1115240 TBT or not TBT
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Or you can live in a city, and have plenty salt stored for human meat preservation.

Tue, 03/29/2011 - 22:34 | 1115444 Mr Anderson
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haha, to each his own.

I prefer-

Beef, venison, turkey, salmon, trout, fruit, and vegatables.  (lets not forget wine)

At least we know your a true survivor TBT.

Tue, 03/29/2011 - 14:38 | 1113663 trav7777
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working and saving has been a fool's game for 30 years.

If you speculated and spent, you came out far ahead.  This is a direct consequence of the financialization of the economy.

Why produce anything when you can participate in a ponzi scheme run by the government?

Tue, 03/29/2011 - 14:41 | 1113673 Mr Lennon Hendrix
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What matters is what you spend on.  If you bought a house in Tokyo, then you fucked up.  If you bough land in L.V. you did too.  If you bought silver at $5, well, the rest is in the books.

Tue, 03/29/2011 - 15:56 | 1113923 depression
depression's picture

Is buying silver at $ 7 spending money ?!!???

The nice thing about silver is, as long as you do not sell it, you pay no taxes on the gains.

Tue, 03/29/2011 - 17:05 | 1114377 Bicycle Repairman
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" If you bought silver at $5, well, the rest is in the books."

Silver covers the last 10 years.  What about the previous 20 years? Even if you were smart/lucky enough to grab gold and silver in 2002, it is still not enough.

What can you say about a system that made "working and saving [...] a fool's game for 30 years."

Tue, 03/29/2011 - 14:47 | 1113697 SteveNYC
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With ever-declining interest rates and (as you said) the financialization/Ponzification of the economy, the "saver" has been raped almost to his/her/its last penny in the US. Unless you are part of the uber-wealthy, the "saver" is almost extinct. The only way to save is in PM's or offshore. Saving in the US is a non-starter.

Tue, 03/29/2011 - 15:01 | 1113758 Encroaching Darkness
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I think you've hit on it - the savings IN AMERICA of American households is probably pretty small - after all, you're taxed when you earn it, the interest is taxed as it's earned and the distributions are taxed when they come in. The only way to avoid negative returns is to invest overseas, in PMs or something that the Feds can't steal and waste (like they stole and wasted the SS contributions).

No one with a working brain would play a casino where the house is so rigged against the bettors, so OF COURSE savings IN AMERICA are down - if you have any sense, you're refusing to lose by refusing to play!

 

Tue, 03/29/2011 - 16:35 | 1114217 aerojet
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None of the spendthrifts went through any such rational decision-making when they decided to hit the gas on spending.  It just felt good.  As far as the rest of your bs statements, let me only say this:  People who do not save get fucked because at some point down the road, your entire life grinds to a halt due to an illness or other emergency and you had better have cash saved for that time.  So if you were to say that the Fed and the Government is robbing Americans of their security, well, that is correct, but it is incorrect to say that saving for the future is stupid or a fool's errand.  All that you are really doing is making excuses about why you're not changing your behavior to get in line with the new reality.  They squeeze you, you have to cut more spending so  that you always have something set aside for the big rainy day.

Tue, 03/29/2011 - 17:07 | 1114399 Bicycle Repairman
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"it is incorrect to say that saving for the future is stupid or a fool's errand.  All that you are really doing is making excuses about why you're not changing your behavior to get in line with the new reality."

I have saved 20%+ of my wages every year for 30 years, and I am telling you that working and saving has been a fools game.

Tue, 03/29/2011 - 14:49 | 1113716 Pseudo Anonym
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Why produce anything when you can participate in a ponzi scheme run by the government?

are you having fun yet?  That's what I want to know.

Tue, 03/29/2011 - 14:52 | 1113731 LawsofPhysics
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Translation; the financial sector of the American economy (which produces NOTHING of real value but owns your politician) remains a cancer on the broader sections of the economy.  What to know why companies and individuals that actually add real value to the economy are not spending?  Simple, they are tired of supporting the cancer.  FYI, the cancer gets it's money via the government and taxpayer rape.

Tue, 03/29/2011 - 15:16 | 1113817 NotApplicable
NotApplicable's picture

So, Trav succinctly states the nature of the world's economic problem, and all you want to know is if he's having fun? Really?

As long as his question remains valid, there are no solutions to life's problems. Also, add to Trav's question the fact that the producers are the target of the ponzi, making the "Why?" all the more relevant.

I realize that sparring with Trav is considered sport around here, but don't let it blind you to any valid questions he may present, as that makes Baby Jesus cry, and in this case, aids the criminal perpetrators.

Tue, 03/29/2011 - 16:26 | 1113899 Pseudo Anonym
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all you want to know is if he's having fun? Really?

it comes down to complicity. Do I want to have fun swimming with the big fish ("aid the criminal perpetrators" - as you put it) defrauding savers or do I choose not to be a part of the ponzi scheme and not have fun.  That's the succinctly stated and valid question.  Isn't it?

Tue, 03/29/2011 - 17:11 | 1114410 Bicycle Repairman
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" Do I want to have fun swimming with the big fish "

Are you actually saying that little fish can swim with the big fish?  Are you saying the playing field is level?

Tue, 03/29/2011 - 18:05 | 1114649 Pseudo Anonym
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Are you actually saying that little fish can swim with the big fish?

yes, I am - using Trav7's definition.  If the majority, the likes of Trav, were not participating in the ponzi scheme, we would not be in this pickle.  Would you not agree with that?

Tue, 03/29/2011 - 20:17 | 1115059 Bicycle Repairman
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If the majority did not participate we would not be here now.  But it is a little more complicated than that.  The rewards for participating (for the better part of 30 years) were substantial.  Those who did not participate got quite the opposite.

But ultimately the laugh is on everyone, except those who played, blew up and got bailed out.  And they knew in advance that they would get bailed out.  And why not?  They were doing G-d's work.  As opposed to me, satan's henchman, I suppose.

/sarc

Tue, 03/29/2011 - 21:20 | 1115185 Pseudo Anonym
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Those who did not participate got quite the opposite.

Those who did not participate (I was not one of them) and "knew in advance" (I was not one of them) were converting hofjuden fiat to PM and are now (or soon to be) set for two lifetimes.  Needless to say, only those at the top of the pyramid "knew in advance".  You have a valid point, nevertheless,  given only few knew.  However, that is not a reason to glorify Trav's summary of the situation today.

Wed, 03/30/2011 - 06:51 | 1116255 Bicycle Repairman
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"However, that is not a reason to glorify Trav's summary of the situation today."

Trav's point is dead on, IMO.  I've been living it for 30 years.  That is several levels above believing my own lying eyes.

Tue, 03/29/2011 - 20:08 | 1114918 Bicycle Repairman
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.

Tue, 03/29/2011 - 14:56 | 1113740 Robot Traders Mom
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The ponzi only works until it doesn't. Millions upon millions of schleps are going to be left holding the bag and it won't be pretty...

Tue, 03/29/2011 - 15:01 | 1113760 10kby2k
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How would you have avoided getting booted off the ponzi in the 2 market crashes in last 11 years? 

 

Tue, 03/29/2011 - 15:12 | 1113796 TruthInSunshine
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If you speculated and spent, you came out far ahead.  This is a direct consequence of the financialization of the economy.

 

Everyone I know, and I know quite a few, who followed your suggestion, are now either broke dicks (after being virtual kings), or are well on their way.

Liquidity is king. Debt is suicide. Always was. Always will be.

Everyone will soon see that this crisis ends the same way all other crises ended before. Harvest time is coming, and it's going to be painful for those not liquid.

Tue, 03/29/2011 - 16:37 | 1114240 aerojet
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Exactly right and perfectly said.  Any other opinion on this matter is a rationalization of some kind.

Tue, 03/29/2011 - 14:46 | 1113707 LauraB
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Great article!  Well said!

The only way for the economy to recover is to flush the bad debt from the system (making those who were responsible for it -- i.e. banks and borrowers -- responsible for the losses rather than pushing it off onto current taxpayers and future generations) and encourage savings rather than borrowing.  We also need to end the Fed so that our savings are not dilluted by money printing.

Tue, 03/29/2011 - 14:49 | 1113710 TruthInSunshine
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I just applied for The Bernank Card.

It's a new credit card that lets me buy shit for 1/4 of one percent interest, roll over the principal as often as I'd like, and my minimum monthly payment is $5.

Oh, there's no credit limit, and if I ever default, The Bernanke guarantees my obligations.

Everyone should have one of these The Bernank Cards. They're very nice to have.

Tue, 03/29/2011 - 15:29 | 1113879 kaiserhoff
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+ Don't think of it as money.  It's only magical beans.

Tue, 03/29/2011 - 16:01 | 1114015 SubjectivObject
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The Bernank America Card

You may have a viable trademark there.

Tue, 03/29/2011 - 14:48 | 1113711 I am Jobe
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Buy silver and guns and food. Nothing else needed. Avoid SLV, another manipulated crap by Whore Street.

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