Lingering recession

A friend recently explained to me why he had such a crappy TV. He said, and I quote, "I can't afford a new one."

He is the problem, right there and if you email me, I will forward you all his contact information. This sort of irresponsibility must be stopped, pronto.

"Wait, you are not spending money on a new TV because you don't have the cash?" I asked.

"No, I bought a new bike and I am strapped."

And so it went. Excuses excuses, one right after the other, mortgage payments, car repair, a gift for his wife. Jesus I kept thinking, he is the reason and should I tell him? Well, should I god?

Dammit, this country has been built on people spending money they did not have and for the first time in recent memory I was talking to one of the people ruining America. He might as well have been a financial terrorist.

What a unique idea, not spending money that you don't have.

When anyone asks me why the recession will linger, I am going to point to my friend and tell them, people are not spending money they do not have. It sounds so simple. In fact, it is.

During the filming of Deregulating Greed I spent a day at the FDR museum and library in Hyde Park. The curator there was walking me through some of the amazing historical photos and documents and one of the things he pointed out was how people relied on actual banks because that was where their money was stored. Again, kick me in the face, actual cash money was actually stored someplace. And in 1929 through 1933 these "banks" were failing faster than a Ben Silverman sitcom. People did not trust the banks because when the closed, the money was gone. No FDIC, no insurance program of any sort.

When FDR got into office one of the first things he did was close banks and take a quick accounting of options. He and congress created the FDIC as a way to bolster support for the ailing banking systems. As the countries finances began to gain trust, people would return, investing money. Keep in mind, back in those days, there was not an industry giving people credit cards to use whenever they wants on purchases of want, not need.

Imagine such a time.