Debt: The Great Seduction

David Brooks' article is timely. While we spend an inordinate amount of time on sex, we as a culture fail miserably discussing the subject of money.

Maybe because I grew up in a blue collar environment, money was a dirty subject. It was impolite to discuss money. The good news is that we were taught the importance of saving and not wasting money. It was evident to me that my parents did what they could to stretch a dollar but you could feel the anxiety and tension surrounding that activity.

With parental guidance, I to picked up a high school class that taught me how to manage a household budget. It was a semester long class but one of the more invaluable courses I ever took. We started out with an annual income, fixed monthly costs and were faced with possible purchases brought on my needs or wants. Physically writing out checks and balancing our checkbooks were incorporated in the course study.

As far as credit cards, it did not take the credit card companies long to figure out they could make more money off of the fees and interest rates. What exactly triggers those fees? These folks aren't predatory lenders?

More of my staff seek help from the EAP for credit counseling than other stress related issues.

Greedy bankers, uninformed homeowners are a recipe for the mess that we are in. No money down! Flip that house!Everyone wants to be Donald Trump. People forget that he had to be bailed out of bankruptcy.

What happened to buying a home?

Learning how to create a budget, manage finances and the perils of credit cards should be mandatory courses of study.

But if our government can't restrain itself, what can you expect from your citizenry?

Let's talk about money

"The Fed normally responds to economic problems by cutting interest rates — and as of yesterday morning the futures markets put the probability of a rate cut by the Fed before the end of next month at almost 100 percent. It can also lend money to banks that are short of cash: yesterday the European Central Bank, the Fed’s trans-Atlantic counterpart, lent banks $130 billion, saying that it would provide unlimited cash if necessary, and the Fed pumped in $24 billion.

But when liquidity dries up, the normal tools of policy lose much of their effectiveness. Reducing the cost of money doesn’t do much for borrowers if nobody is willing to make loans. Ensuring that banks have plenty of cash doesn’t do much if the cash stays in the banks’ vaults.

There are other, more exotic things the Fed and, more important, the executive branch of the U.S. government could do to contain the crisis if the standard policies don’t work. But for a variety of reasons, not least the current administration’s record of incompetence, we’d really rather not go there.

Let’s hope, then, that this crisis blows over as quickly as that of 1998. But I wouldn’t count on it."

The past two weeks have been bumpy for investors. Even if you don't have skin in the game per se, you will affected indirectly, through higher prices, or inability to get credit.

Finances is the one subject, we as a society fail to discuss openly. Talk about family secrets. People live in expensive trappings but work wacky hours just to have bigger homes or the latest gadgets. How many families are living beyond their means? Their homes and crap are built upon shaking credit.

I came from a working class family. In my junior year, my school had a trip to France. I think my father would have a given up a kidney than tell me this trip was not in the budget. He was very bitter and angry about the whole thing. A simple we can't do it would have been fine. There would have been less hard feelings about the situation. I learned a lot about finances and the silly secrets.

The mortgage drama has been created, in my humble opinion, by people's failure to have a basic understanding of finances.
Budgeting and the concepts of borrowing money should be taught by schools by the eighth grade. If your folks won't talk about it the schools need to step in.

Retired NFL Players face lousy pensions

The NFL retirees are facing the same situation most working and middle class Americans. Most Americans will not even have a pension of any kind. The lucky ones have 401k plans.

Most of the NFL players are recruited from college programs. Where was the financial planning? The money that is made by the networks, teams and the players there is no excuse for the players who preceded them not to have a decent pension and health care.

Get it where you can, financial planning

It never ceases to amaze me how taboo it is to talk about money. It was not lost on me, the verbal fights my parents had about money. Bill collectors would call and it made my mom crazy. Raising a family of five on a steelworker's salary was a challenge. My dad refused to let my mother assist with the finanical planning. Remoldeling the house was my dad's drug of choice.

We never wanted for food, clothing and the occasional inexpensive restaurant dining. It was a really big deal to eat at Howard Johnson's. It wasn't until I got to college that realized how middle class we weren't. There was a chronic unspoken under current of financial strain. BUT you did not talk about it.

In my senior year, one of the popular girls suddenly put on weight. At first, pregnancy was suspected. Eventually, she broke down in class, and revealed her father had lost his job. The weight gain was the result of eating more potatoes because that was all they could afford. She said it would have been easier to be pregnant than poor. Dear God. These are the values we as a society we instill in our youth.

It wasn't until my father thought that he was going to die, that he had a honest conversation with my mother, his wife about little things like what bills needed to be paid. A little financial planning/management would have did my folks a world of good.

As a society, sex is discussed freely. Why on earth is it such a problem to talk about money? Why are those without money or get into a financial bind ostracized?

Financial planning should not be reserved for those making six figures. By learning how to manage money early, the credit card debt crisis could be mitigated early in some cases.

Bur the need for instance gratification is everywhere. We talk of values. What is so wrong with waiting until you can afford a luxury item like a HDTV?

Unfortunately, credit card companies, rent-a-centers prey on this itch that we have convinced ourselves needs to be scratched immediately.

Passing a financial planning course in high school should be mandatory for everyone.