Do We Even Have A Choice?

How about this article from CNBC? http://www.cnbc.com//id/25735696 The article discusses how "glum" (how bad does the economy have to be to use the word "glum") consumers have started to save more money and pay down their current debt. I am assuming the reason for this is because consumers aren't sure how much money their going to need in the future. Will gas go up to $10 a gallon? Will vegetables trade higher than gold?

We were caught off guard by gas going over $4 a gallon but we won't be fooled again. We would like to believe that gas just can't go any higher but we still don't know why gas went up in the first place so we have to believe that it can still go even higher.

'"Most of the planned declines in debt and increases in savings are intended as a precautionary measure in the face of a deepening economic downturn," Richard Curtin, director of Reuters/University of Michigan Surveys of Consumers, said in a statement on Friday ahead of Tuesday's release of the poll" from a quote in the article. Which in English means people are scared and now do not have clue if they will have enough of money to survive.

Nobody saw this coming. And now consumers are gun shy and cannot trust anything they see or hear about the economy. With rising gas and food prices, foreclosures, layoffs, banks going out of business everyday and lenders needing a bailout the only thing that consumers can do is take cover by reducing their debt and saving whatever they can.

When you're not sure the floor is going to cave in when you take your next step, you better have the money to fix it when it does.

Hopefully, the step can wait until we have enough cash saved.


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Dan Tenchall
Great Lakes Mortgage Funding

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