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| So exactly whats the deal with this quote"e recession? | ||
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| Madvillain |
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Registered Member #445
Joined: Sun Oct 01 2006, 11:42PMPosts: 2233 |
everyday my parents are like "You better be getting good grades, the country is in recession" and such. I could never take em seriously so im like w.e. till i get a mail in the letter saying i they might be canceling student loans, lol then im like "holy shit wtf"? without em im screwed. But besides that, if the country's ending student loans sumthing must be up, and i wanna know whats the deal. Edited Sun Jun 01 2008, 07:53PM | ||
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| Trunkz |
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Registered Member #1055
Joined: Tue Apr 29 2008, 12:37AMPosts: 145 |
thats what u get for living in the states ? | ||
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| memnoch |
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Registered Member #839
Joined: Sat Aug 18 2007, 06:37AMPosts: 204 |
It's really a matter of economics. You have a main market resource that the country is so widely relying on. In this case, oil. People use it to travel. Goods are shipped, the gas costs more, thus, we drive up costs to remain profittable. People and companies spend more money on gas, and thus, less on other market commodities. How does this affect student loans? Universities are trying to stay profitable, just the same as banks. Lowered enrollment will cause some universities and colleges to drop the amount of scholarships they offer. Banks will drop the amount of loans they offer because people aren't putting as much money in the bank and saving. Hope that helps, dude. ps, you're parents are saying go to school so you can get a well paying job and not struggle for the rest of your life. Edited Sun Jun 01 2008, 08:09PM |
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| NoSkill |
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Sir
Registered Member #457
Joined: Tue Oct 10 2006, 01:13PMPosts: 2628 |
One word. Adjustable Rate Mortgages. When you buy a home never get an ARM, always get a fixed rate mortgage. The money you COULD save with an Adjustable Rate is in no way worth the risk of having to foreclose on the largest investment in your life. Which is exacty what a very many American families have had to do in the past 5 years and continue to do. Item 2. Save your money. We have an appallingly dismal individual saving rate in America. People use credit to pay for everything. Nobody has a "rainy day fund". What does this mean? It means when you lose your job your buying power is reduced to ZERO because you have no cash. Now you OWE more money to your creditors for goods and services you've already used than what they were worth when you bought them. And the longer you take to pay down your debt, the more interest you will owe. Global considerations. War. War is expensive. Not only must billions of tax dollars and man power go into war, it also reduces the producing power of the nation at war. (it's a small consideration, but what if all the troops overseas were home working & producing) In addition to the reasons above. What you should be asking is, how do I survive a recession/depression without a noticeable impact in my standard of living? Well I'm glad you asked. The short answer, you can't. Massive economic downturns will affect us all, severely in some cases. Step 1. Pay down your high interest debt. I'm not talking about student loans either. I'm talking about credit cards and car loans. Pay these off as fast as possible. Step 2. Save 3-6 months worth of income. If you lost your job, you should be able to live for 6 months without work. So if you make $1,000 a week (and have grown accustom to such) you should save between $12,000 and $24,000. Step 3. Invest at least 25% of your disposable income for the future. Stocks are good, but if we ever faced a depression would be utterly useless. It's not crazy to invest some of your money in items whose value will never fluctuate too wildly with inflation. Items like precious metals. Step 4. Go crazy and become self-sufficient. I'm talking log cabin, deer hunting, survivalist type shit here. Read the book Patriots: Surviving the Coming Collapse. If you can get that prepared, you can survive anything. Seriously. Be afraid. Be very afraid. |
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| b4ndito |
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b4ndito
Registered Member #958
Joined: Fri Jan 04 2008, 06:59AMPosts: 3385 |
NoSkill wrote ... One word. Adjustable Rate Mortgages. Three*. |
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| Ruskiy Soldat |
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Registered Member #465
Joined: Tue Oct 17 2006, 10:00PMPosts: 1295 |
fuckin hate taxes | ||
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| Madvillain |
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Registered Member #445
Joined: Sun Oct 01 2006, 11:42PM Posts: 2233 |
lol dam noskill, i got the whole rundown and even the precautions against it! lol thnx Edited Mon Jun 02 2008, 01:03AM | ||
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| yourdroid |
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Registered Member #36
Joined: Thu Dec 01 2005, 06:12PMPosts: 214 |
Noskill is right... memnoch not as much. Mortgages and bad credit handling have put us in this mess. Banks loaned billions of dollars in mortgages and people stupidly went with an ARM. Then when interest rates changed because of a multitude of factors, such as inflation and the falling dollar/rising euro values, people were unable to make the new payments. Blah, blah, blah (don't want to bore everyone with details so i'll try to sum everything up). Combine that with job losses because of companies trying to stay competitive in a global market and you have banks suddenly loosing a lot of money. A slow down in the housing market (which was coming soon anyway but has been magnified by the credit mess and is taking more blame for economic conditions than it should) also left a few more economic segments in a down year with construction companies, real estate companies, contractors, ect. Various other Major companies also took hits because of the credit crisis. Many firms had investments in mortgages and lost hundreds of millions when people couldn't pay. That company looses hundreds of millions and then their stocks take a hit. People who own that stock loose their money, they loose a nice chunk if not all of their savings. Though if they loose all or most because of one company or industry then IMHO they kind of deserve it for putting all their eggs in one basket. Gas doesn't have all that much to do with it. Gas price increases have increased the costs of items some but not to the point that it has a major effect to bring on recession. Say the average car holds 15 gallons in its tank. The price of gas has gone up 72.8 cents over a year (-[link]- So lets say you fill the tank twice a week because you drive all day long. nice amount because most won't fall in that. so 30 gallons x 52 weeks x .728= 1135.68 per year more in gas. That is 21.84 a week. If $21.84 cents a week puts you into complete recession then you had problems to begin with and gas prices are not your biggest concern. And that is assuming the 72.8 cent increase happened all at once and isn't gradual as it really is. I find it hard to blame everything on gas like the media would like to. |
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