What Can We Learn From the Economic Crisis?

Credit where reputation is due, every cloud has a silver lining, yes I said silver not gold! The economic urgency now raging over the world was if you tugged very at once the rug we have all been standing upon and has left many feeling wobbly, or even worse, on the floor. It has in actual fact raised many questions about our personel and communal security.

Actually the culture of credit, the culture of buy now pay later has not been with us for very long, possibly two or three generations. My mothers generation referred to reputation as paying on the never, never, my generation has gone one supplementary to paying on the never ever!

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I should at this point make clear that I am by no means a financial genius, but probably that is already clear to you, I am just a regular guy like most, but I have all the time wondered just how the chain of reputation easily worked.

Credit has all the time seemed to me a legal ideas of pyramid selling in that there seem to be myriad levels of credit, let me explain. I want to buy a house, so I take out a mortgage of say 0,000 at my local bank, but that is just stage one of a chain of events that continues upwards and onwards straight through the stratosphere, that 0,000 may well have finally come from outer Mongolia! all the time at the back of my mind is where easily does the real money come from, do you know what I mean?

I will try to be clearer. I know that if my bank loans me money that it is very probable they in turn will borrow from a bigger bank and the bigger bank, well they can borrow from their central bank etc., etc., but again where finally does the real money come from and it begins to seem, that maybe the real money was never there....Shock Horror!

Remember the renowned tale for children by Hans Christian Anderson "The kings magic clothes"? He easily had none, was stark naked, but had managed to convince his subjects that he was most marvellously attired. All went well until a small boy, somehow out of the loop could see quite clearly that the king was thoroughly naked and said so out loud, whoops the spell was broken and everybody saw a naked king.

Could this analogy fit the economic crisis? That we were all getting along just fine and dandy borrowing money as if there was now tomorrow and hey presto tomorrow came! Now looking back at the financial culture of our fathers and our fathers, fathers it had merit, the culture of earning and recovery before spending money, yes I know very uncool and old fashioned, but they did not have to worry about bankers over paying themselves did they. They at least owned what they had, not a bank, assurance company, or the sultan of Zanzibaar!

Is the ideas of reputation we have known now no more, dead, deceased? I intuit not plainly because a huge money manufacture motor grew up globally on the back of the reputation boom, tens of thousands of middle men earning telephone amount incomes sprang up on the back our impatience and our unwillingness to postpone that must have purchase until we had easily had the money.

So as ever we will each have to learn the lessons from the economic urgency by ourselves. Do we easily need right now, that bigger house, car, or wife, or would we prefer the peace of mind of knowing that what we have is ours, cannot be taken away and enjoy what we have?

Who knows what the time to come will bring, but it does seem that we have passed a not very nice parcel to time to come generations.

Terrence Aubrey,

http://www.confidentialmatchmakers.com

What Can We Learn From the Economic Crisis?

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