Waxingandwayneing’s Weblog

October 13, 2008

Tightening the Belt

Filed under: The Economy — waxingandwayneing @ 2:50 pm

With the economic news getting worse by the day, most Americans have finally realized that the “Buy Buy” days of yesterday have now gone “Bye Bye”.  Fueled by unrealistic liquidity over the past several years, the American consumer has been on an artificial shopping spree, accumulating merchandise they didn’t really need or certainly couldn’t afford.  It now looks like the party is over.  Hallelujah!

Last week, Stephanie Rosenbloom of the New York Times reported that, “Sales at some of the nation’s best-known retailers fell by double digits in September, highlighting the rapid deterioration of the economy and raising fresh questions about how many of those chains can survive.  Retail analysts and executives said they had not seen such a rapid slowdown in consumer spending since the nation’s last deep recession, in the early 1980s.”

If it takes a recession to sober up the American consumers from their drunken buying binge, then so be it.  No longer able to borrow on their home equity lines or credit cards, and worried about losing their jobs, consumers are starting to adopt responsible spending habits, e.g., “Can i really afford that?” or “Do I really need that?”  Go figure!

Jan Hoffman wrote a nice piece for yesterday’s Sunday New York Times entitled, “The Frugal Teenager, Ready or Not”.  She discusses the shock to teenagers being forced to do without all the luxuries they grew up with.

“When Wendy Postle’s two children were younger, saying “yes” gave her great joy. Yes to all those toys. The music lessons. The blowout birthday parties. But as her son and daughter approached adolescence, yes turned into a weary default. “Sometimes it was just easier to say, ‘O.K., whatever,’ than to have the battle of ‘no,’ ” said Mrs. Postle, a working mother who lives in Hilliard, Ohio, a middle-class suburb of Columbus.  This year her husband’s 401(k) savings are evaporating. Medical bills are nipping at the couple’s heels. Gas prices are still taking a toll. Mrs. Postle recently decided that although she and her husband had always sacrificed their own luxuries for Zach, 13, and Kaitlyn, 15, the teenagers would now have to cut back as well.”

Ms. Hoffman writes about the indulgent behavior of parents…eager to please their children and avoid arguing.  So many kids “were raised in comparatively flush times by parents who believed that keeping children happy, stimulated and successful, no matter the cost, was an unassailable virtue. A 2007 study by the Harrison Group, a market research firm in Waterbury, Conn., found that nearly 75 percent of parents caved in to their children’s nagging for new video games, half within two weeks.”

So, having raised a generation of adolescents trained to get whatever they want, whenever they demand it, we are now having to turn to these kids and say, “No”.  Cutting back is not only prudent, it is imperative.  Mom and Dad simply do not have the money.  Shocking or not, you had better tighten your belts.

What will be most interesting with this economic diet is to see the impact on personal identity of children, as well as adults.  No longer able to afford that designer handbag, sports car, or the week-long rental in St. Barts, consumer will start to suffer from luxury withdrawals, followed by deflation of the ego.  Having previously identified themselves from material goods, people will struggle to define themselves in the absence of these possesions.

It will probably shock many consumers that their personalities are vapid without toys.  What else is there to talk about?  For others, the cutting back mode might yield interesting personas, able to relate to others on a deeper level.  The optimist in me imagines more people reading thought-provoking books, listening to NPR, attending a lecture at the local community college, or volunteering time at a local non-profit.  There are so many things to do that do not involve spending money, but that do yield meaningful enhancement to the person and contributions to society.

The next few months (or years) are going to be tough for so many.  As you tighten that belt to the next hole, take a deep breath, realize you are not alone, and seize the chance to be a better person.



  1. I completly agree with you. We have our toys, but they cost 1/3 and they are paid for.

    In the past 4 years, we often felt envious of the guy at the Colorado River, where we vacation less dragging the “Big Dawg” boat, at a price tag of ($80-200k), and his Escalade or Big Rig Diesl, with a new license plate (s).

    The thought crosses your mind…that guy must be very successful, after all he has all the toys hanging from it and of course, the new “Weekend Warrior”.

    The next day you find out that he has a job that probably pays under $75k between husband and wife, with a home in a new area. All the toys are leveraged with equity from the house. The problem is that they were never told any different because everyone else in their tract does the same thing. No excuse, but they got caught up in the “have it and enjoy it now vacuum”

    What hurts more is that they have to walk away from it all the upsidedown holdings, with ruined credit and a new understanding for the value of money.

    Jobs become more important, and well,….you just keep on going.

    Is this you? It is not too late, and with this not sounding like an ad, check out the sobering common sense words of Dave Ramsey.


    Comment by Eric Kirkhuff — October 13, 2008 @ 4:10 pm

  2. Very insightful but you sound just a skosh holier than thou, Wayners. Pardon my 2 cents, but I guess I think we all need to examine our OWN behavior…including the people giving sound advice.
    still love you~

    Comment by Barb Schwartz — October 13, 2008 @ 4:17 pm

  3. I do agree that my comments may sound a bit “preachy”. I am upset by the current situation. We all have a hand in it. I hope we can use this time to examine what got us into the mess and avoid repeating it (until, at least, the next cycle!).

    Comment by waxingandwayneing — October 13, 2008 @ 5:36 pm

  4. I think you are right on. It brings us to that issue of personal responsibility which we as 250 million Americans have shunned. It’s time to get it back, to look inward and be happy with ourselves not our possessions.

    Comment by Steve Casselman — October 13, 2008 @ 6:30 pm

  5. Another good article. I think we all needed a financial reality check and hopefully we won’t forget our lesson as quickly as we normally do!

    Comment by Steve Naylor — October 14, 2008 @ 9:19 am

  6. You speak the truth, my fine Indian Companion (Radio Days)
    We live in interesting times and I suspect they are soon to become even more interesting. The true test will be to see what people are left with when they no longer have as much dough or stuff. What are we to each other and in the world? This may be the hardest decision to make. Do we really believe we are defined by more than what we have? I hope so. I hope that our children will learn, if they haven’t already, that our value has nothing to do with what we have.

    Comment by nora — October 21, 2008 @ 4:19 pm

RSS feed for comments on this post. TrackBack URI

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

Create a free website or blog at WordPress.com.

%d bloggers like this: