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Anthony Bourdain on not having debt

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Re: Anthony Bourdain on not having debt

#91

Post by stuaxo »

edanm wrote: post #62
yequalsx wrote: post #32

Earlier quoted context omitted.

I believe there are no examples of charity ever being able to provide the basic needs of all but a small percent of the poor of a nation. It was not charities that provided clean water. It was not charities that largely ended hunger or gave healthcare to the poor. It was not charities that educated the masses. Government is necessary. It can be done badly but it doesn't have to be.

You might be right but I'm not sure what you prevented is any kind of proof that charity couldn't provide those needs. It's just that in most cases, governments effectively have a monopoly on providing these kinds of services, making charity either redundant, or legally unable to provide said services.

The problem is, you need quite a bit more money than charity can give. People just aren't generous enough for it timescale, the example elsewhere in this thread of universal healthcare is a good one.

Re: Anthony Bourdain on not having debt

#92

Post by taurath »

camillomiller wrote: post #77
kevinmannix wrote: post #3

I wish more people thought this way. Debt can be be used effectively, but as Uncle Ben said, "With great power comes great responsibility." It seems that too much of America is wooed into a false sense of security by their ability to obtain debt without judging their ability to pay that debt off.

It surprises me all the time to see what you can do with a CC in America. Here in Europe it's also very common to have a direct debit card. You don't have a monthly bill, but the amount you spend is directly deducted from your account. Lots of people prefer that.

We have those here too, and I think it's relatively common to pay off of those.

Re: Anthony Bourdain on not having debt

#93

Post by taurath »

shostack wrote: post #64
charlieflowers wrote: post #59

Earlier quoted context omitted.

Most Americans are using debt to buy consumer goods. So the question most should ask themselves is, "As a citizen of a first world country, with a good job and a super high standard of living, why is it that I need to consume some of tomorrow's dollars to get myself even more stuff right now?"

Then there's the flip side of using credit cards to get a 1%+ discount on things and paying it off in full. If you have the cash and discipline, debt can be used for very low risk benefit.

And CC companies bank on the fact that if even a small percentage of people aren't able to pay it off in full they'll get their "rewards" back in full within a single period of interest.

Re: Anthony Bourdain on not having debt

#94

Post by taurath »

ianai wrote: post #47

There was a point where financing the government was a patriotic act. People would give other people War Bonds as presents. But now the patriotic thing is to trash talk which ever party is in the administration and wax poetic about governmental corruption. You can't have it both ways. You can't say no to financing your government and scorn corruption. Either you're okay paying for your government, you're okay with so…

The government needs better PR frankly, instead of allowing itself to be a punching bag all day. Nobody can even imagine how many things the government and your tax dollars provide.

Re: Anthony Bourdain on not having debt

#95

Post by glandium »

camillomiller wrote: post #77
kevinmannix wrote: post #3

I wish more people thought this way. Debt can be be used effectively, but as Uncle Ben said, "With great power comes great responsibility." It seems that too much of America is wooed into a false sense of security by their ability to obtain debt without judging their ability to pay that debt off.

It surprises me all the time to see what you can do with a CC in America. Here in Europe it's also very common to have a direct debit card. You don't have a monthly bill, but the amount you spend is directly deducted from your account. Lots of people prefer that.

As coming from a country where debit cards are widespread (France), and living in one where they barely existed until recently (Japan), and having had my (japanese) debit card fraudulently used (still a mystery how ; not stolen, barely even used at all ; last use 8 months prior), I now know that credit cards are better in that case: if you notice the fraudulent use early enough, it's not going to hit your account, while I'm now stuck waiting for a reimbursment that will hopefully happen 3 months after reporting the event.

Just for that, I now prefer a CC, not using the "Credit" part of it. Edit: well, technically, I'm using it, but only as a buffer.

But it's always awkward to be asked "single payment?" for ridiculous amounts like $20. Huh, yeah, why? are people really paying such amounts in multiple installments?

Re: Anthony Bourdain on not having debt

#96

Post by rwmj »

d_t_w wrote: post #13
kevinmannix wrote: post #3

I wish more people thought this way. Debt can be be used effectively, but as Uncle Ben said, "With great power comes great responsibility." It seems that too much of America is wooed into a false sense of security by their ability to obtain debt without judging their ability to pay that debt off.

I agree with your sentiment, but it strikes me that there is safety and opportunity in behaving badly when the bulk of your peers are swept away in an orgy of debt fuelled spending. Ten years ago I bought a small flat in London to live in. I paid a respectable deposit and didn't over-leverage. We were at the end of decade long property boom, there were huge concerns about the level of borrowing and ability to repay,…

I mostly agree with you, but I think you missed one problem. Suppose you bought the 3 bed house. You'd have big mortgage payments to make every month. It all depends on when you sell the house. Too early and you would be sitting there watching the market increase further. You never really know when the market will turn, and if you left it too late you could be in negative equity with no way to sell the house and trying to make big repayments, perhaps having also lost your job (since these things happen at the same time).

In other words unless you've got a foolproof method of predicting the future, or you love the thrill of huge financial risks, I think you made the right decision to live within your means.

Re: Anthony Bourdain on not having debt

#97

Post by bootload »

soVeryTired wrote: post #88
bootload wrote: post #5

Earlier quoted context omitted.

"I wish more people thought this way." It used to be common to view personal debt this way. I noticed a big change in the way debt was perceived by during the late '80s. Since then, debt is seen as normal. I'm pretty sure the finance industry has pushed 'Fractional reserve banking' to the limit to allow unchecked borrowing for land and housing. [0] Reference [0] "fractional-reserve banking permits the money supply to…

Fractional reserve banking doesn't really exist any more in the developed world. Banks lend against their capital, not their reserves [1]. [1] http://www.bankofengland.co.uk/publications/Documents/quarte...

"In normal times, the Bank of England implements monetary policy by setting the interest rate on central bank reserves."

thx @soVeryTired, plz excuse lack of financial knowledge. What is the definition of "reserves"?

Re: Anthony Bourdain on not having debt

#98

Post by soVeryTired »

bootload wrote: post #97
soVeryTired wrote: post #88

Earlier quoted context omitted.

Fractional reserve banking doesn't really exist any more in the developed world. Banks lend against their capital, not their reserves [1]. [1] http://www.bankofengland.co.uk/publications/Documents/quarte...

"In normal times, the Bank of England implements monetary policy by setting the interest rate on central bank reserves." thx @soVeryTired, plz excuse lack of financial knowledge. What is the definition of "reserves" ?

A bank's reserves are the funds it holds in its account in the central bank. Some countries require that a certain proportion of the bank's assets are held in reserve in order to be sure it can easily meet its short term liabilities (i.e. to safeguard liquidity). In that regard, the system is a little like fractional reserve banking. But the UK and Canada don't have reserve requirements at all. In general, the main constraint on a bank's lending is its capital. Which is why you read about "core tier 1 capital ratios" when a failing bank makes headlines.

Re: Anthony Bourdain on not having debt

#99

Post by patrickaljord »

ianai wrote: post #47

There was a point where financing the government was a patriotic act. People would give other people War Bonds as presents. But now the patriotic thing is to trash talk which ever party is in the administration and wax poetic about governmental corruption. You can't have it both ways. You can't say no to financing your government and scorn corruption. Either you're okay paying for your government, you're okay with so…

There's that last option where you would be ok with having no government at all. Although, governments usually do not offer it except maybe in Liechtenstein.

Re: Anthony Bourdain on not having debt

#100

Post by adrianN »

charlieflowers wrote: post #59
kevinmannix wrote: post #3

I wish more people thought this way. Debt can be be used effectively, but as Uncle Ben said, "With great power comes great responsibility." It seems that too much of America is wooed into a false sense of security by their ability to obtain debt without judging their ability to pay that debt off.

Most Americans are using debt to buy consumer goods. So the question most should ask themselves is, "As a citizen of a first world country, with a good job and a super high standard of living, why is it that I need to consume some of tomorrow's dollars to get myself even more stuff right now?"

I pay everything with my credit card. It automatically gets deducted from my normal account at the beginning of the month. I get a little money for every purchase and the credit card company gets to now my purchasing habits.
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