I generally discover it amazing to read news stories and commentaries about personal finance put out by the mainstream media. Numerous of them seem to lack any focus in their messages to customers, if they’re not openly schizophrenic. This could possibly be as a result of the truth that these big media corporations are attempting to appeal to the broadest audience achievable, but conflicting stories serve no real purpose but to keep up the appearance that everything may be the same even when the world and economy are radically changing about us.

Take, as an example, a couple of the stories posted by MSN Finance lately. 1 is titled “The Credit Card Party is Officially More than,” which discusses credit card organizations jacking up interest rates along with the overall drying up of consumer credit. Even for customers who have a great credit history, banks are cutting down on the limits offered to them on new lines of credit and are attempting to discourage people from opening new credit cards so as to transfer balances from old credit cards. Overall, the article is somewhat cautious about shoppers employing credit and advocates them taking care of their very own individual economic situations without having borrowing more.

Nonetheless, just a couple of stories down is an additional post published on MSN Finance, though it can be taken from Bankrate.com. This one is titled “Why You’ll need Many Credit Cards” and deconstructs the arguments against getting several open credit lines. The wonders of using consumer credit are boundless if utilized properly, based on this write-up, for instance the feeling of economic safety along with the lure of rewards for making use of the card. People who use their numerous credit cards wisely will also enhance their credit scores, which indicates that they are going to pay overall lower rates of interest on other debt, including housing or auto loans.

So, the message is… what, precisely? Possibly the message is that credit might be applied wisely to rack up rewards and really feel safe, until the bank jacks up the interest rate and lowers the credit limit. That will not seem very reassuring, plus the average person will have to determine between heeding the warnings of the dangers of credit or continuing to do their best to keep on best of a mounting pile of debt. The truth that the second article aims to reinforce spending via credit cards just isn’t surprising: customers need to use additional credit, so that they are able to qualify for lower interest rates on much more credit. The circle only ends when the homeowners are in foreclosure or the shoppers are in bankruptcy. 

But of course, discovering oneself in bankruptcy or foreclosure can not be blamed on the poor decisions of the consumer or the misguided guidance of the economic gurus. People that do not save for a rainy day have a brain disorder is all; or at least that is what CNNMoney.com has to say about it. An post titled “Can’t Save? Blame Your Brain” discusses the psychological differences that humans feel when given a option of instant gratification compared to waiting for a bigger reward later in time. So all those household buyers who are now attempting to stop foreclosure ahead of they lose their overpriced properties that had been bought at the leading of the market can put the responsibility for their circumstance on the physiological makeup of their brains, not on their lack of capability to control the thoughts and feelings that go on in that brain.

The only remedy supplied in a recent write-up, needless to say, would be to trick oneself into saving cash now. CNNMoney.com has an write-up about this, as well, titled “Fool Yourself Into Saving Smarter.” Saving up a number of thousand dollars and then spending it on far more consumer goods like iPods or big-screen TVs, though, is little greater than just applying for a different credit card to utilize “wisely” and rack up “points.” Significantly much more powerful would be a alter in attitude about the role of dollars in one’s life; whether or not it’s to be used just as a blunt object to score points and additional stuff to maintain up using the neighbors. Money represents power plus the capability to do function, and it’s doubtful to me that any person need to just expend energy to preserve up an appearance of getting more money.

The large mainstream media corporations aren’t there to supply buyers using the most significant information about the nature of money and law, though. It should not be surprising that they encourage people to continue consuming far beyond their means by means of credit cards, whilst quietly warning them of the dangers of this activity. But even those who wind up in foreclosure or bankruptcy can not be blamed for ignoring these warnings — they’re just responding towards the chemicals in their brains that tell them to consume till they lose it all. Needless to say, the media and banks also can not be blamed for the propaganda; after all, they issued several perfunctory, half-hearted warnings, right?

Tags: banking institutions, foreclosure, foreclosure process, loan modification

This entry was posted on Sunday, December 18th, 2011 at 11:12 pm and is filed under property. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.