If someone were to try to explain what caused the dire economic conditions facing the US, the easiest way would be to say that Americans live in an economic fantasy world that is in no way sustainable. Today, GDP numbers were released showing a dismal 1.2% growth for the US, but the media is still enthusiastic about the return of the housing market and all is better. It doesn’t take a rocket scientist to figure out that things aren’t getting better, and if anything, this could only be called the new normal if it doesn’t get worse. Right now, Americans should file for bankruptcy to wipe out the unsustainable debt they’ve accumulated, but instead, they’re robbing Peter to pay Paul off by getting new credit cards and personal loans so they can keep kicking the can in the future. In 2012, the Federal Reserve reported that the average American has $16,000 in credit card debt. While in today’s economy, $16,000 doesn’t seem like a lot, but four years earlier that figure was only $4,000. The reason so many Americans should file for bankruptcy and don’t is that banks are making credit available to these people. In 2010, the US saw a record number of people file for bankruptcy because they had no other choice and were on the ropes. At the same time, many of these people lost their homes to foreclosure and had to stop aggressive creditors who might have repossessed the home through liens.

Everyone wants to know why all this is happening, but no one really looks at the root of the problem. The government continues to gain power and control by putting people in entitlement programs where they need them to survive. This was not the intention of how the country was founded, as the founders wanted a small government. Many people are currently unemployed, and as long as your unemployment insurance continues, why look for a job? Unemployment could pay them as much as work would. Add to that the ability to borrow more money from creditors and you have a group of people who should be filing for bankruptcy but refuse to. I understand the dilemma, but it still doesn’t get it right. With taxes going up and wages going down, there’s no real incentive to work hard anymore. With all the new regulations, it’s almost impossible for small businesses to even get started, thus wiping out the American dream. The federal government keeps telling everyone how to live, but it would certainly be nice if they led by example. The fight continues and the government continues to raise the debt ceiling as the US debt approaches $17 trillion. Someone recently made an interesting comment about how the Fed has been printing US dollars infinitely and why they need to raise taxes if they can only print their way out of debt. It doesn’t seem to make any sense, except that the American middle class will soon disappear if people don’t take responsibility for their own financial actions.

Until the 1970s, Americans prided themselves on being debt-free and living within their means. Once the 1970s hit, credit cards were sent to everyone, even if you didn’t apply. The creditors stepped up the advertising campaigns of being able to buy it now and pay for it later using plastic. It almost seemed like free money and many went overboard sending them into bankruptcy. The last generation knows no other way of living than on credit. The average college graduate leaves school with $25,000 in debt. They don’t even have a job yet and are already in captivity for life. The deciding factor for young adults leaving college is the student loan debt they have acquired. After graduation, if they can’t find a job, it doesn’t matter that they still have to find a way to pay off that debt. Thinking of filing for bankruptcy? It is not a possibility, it is almost impossible to declare bankruptcy with student loans. While everyone believes that the US is a land of opportunity, no one really knows the dark side of how the only thing driving this economy is debt-fuelled prosperity. It’s all fake, most so called millionaires are leveraged beyond belief and if they take away their line of credit it’s game over. What’s wrong with going back to the way your grandparents lived and trying a debt-free lifestyle? Even if it means filing bankruptcy to put an end to all this debt, it will add an ounce of happiness in the long run and relieve a lot of stress.

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