Americans: Broke, Unload Prized Belongings to Make Ends Meet

[Sapiens]

http://abcnews.go.com/print?id=4750846

NEW YORK (AP) - The for-sale listings on the online hub Craigslist come with plaintive notices, like the one from the teenager in Georgia who said her mother lost her job and pleaded, "Please buy anything you can to help out."

Or the seller in Milwaukee who wrote in one post of needing to pay bills - and put a diamond engagement ring up for bids to do it.

Struggling with mounting debt and rising prices, faced with the toughest economic times since the early 1990s, Americans are selling prized possessions online and at flea markets at alarming rates.

To meet higher gas, food and prescription drug bills, they are selling off grandmother's dishes and their own belongings. Some of the household purging has been extremely painful - families forced to part with heirlooms.

...

[Sapiens]

WSJ: Pinched Consumers Scramble for Cash

http://online.wsj.com/article/SB1212..._us_whats_news

Pinched Consumers
Scramble for Cash
By ELEANOR LAISE
June 2, 2008; Page A1

After a long binge of borrowing, U.S. consumers face a credit crunch and a sagging economy. To sustain their living standards, many Americans are doing what comes naturally: scrambling to raise more cash.


Sheron Brunner, 63 years old, bought a $250,000 life-insurance policy in 1997, planning to leave the proceeds to her three children. She faithfully made her $113 monthly payments. But after retiring in 2002 from her job running a homelessness-prevention program, her finances unraveled. Health problems forced her to siphon her savings. A monthly Social Security check of about $700, her only source of income, doesn't cover her medical bills and rising everyday expenses. In September, she moved to Wichita, Kan., from San Francisco to cut her cost of living.

It wasn't enough, so this spring she signed what's known as a life-settlement agreement with J.G. Wentworth, a company that buys life-insurance policies and other tough-to-sell assets. The contract transfers ownership of a life-insurance policy to a third party, which then pays future premiums and collects the benefit. Ms. Brunner received about $45,000 for her $250,000 term policy.

...

[sadsack]

Re: Americans: Broke, Unload Prized Belongings to Make Ends Meet

I've trolled austin.craigslist for years now. I definitely have noticed a shift in the postings.

During the housing bubble, you would find high end "toys," and very high end, but now "unfashionable" furniture sets (e.g., Baker, Henkel Harris, Stickley early American styles).

Nowdays, the "toys" are still there, but they're not cheap anymore. I impute the reason to be that people are now selling for cash, rather than selling to just "get rid of" the item.

On the furniture front, prices resemble the housing market - people forced to sell who are being stubborn ("I paid $8,000 four years ago for this" :rolleyes. The real deals are few and far between, and what few that exist are being scooped up within hours by "resellers" AKA fleabay hos.

Most times that my wife posts stuff, the first responses are from flakes wanting to know if the item is in pristine condition. Why? They're fleabay hos and need "mint" items to turn around quick for the resale.

Needless to say, the wife and I are miffed. Craigslist is being completely corrupted from the community-based idea of its founder.

Maybe in the hard times to come, it will morph into the cyberspace version of the urban streetcorner, where virtual apple salesmen can cast their desperate electronic shills to passersby.

[skurla2000]

Re: Americans: Broke, Unload Prized Belongings to Make Ends Meet

It's funny. I was just remarking to my wife this past weekend on the huge increase in the number of garage sales in our town. I counted 8 in my community on my Saturday morning run.

One garage sale included two bathtubs, vanities and kitchen cabinets, presumably from a foreclosure in which the soon to be foreclosed owner was trying to squeeze out every dime before being squeezed out himself... Won't the bank be surprised on repossession day!

[Guest]

Re: WSJ: Pinched Consumers Scramble for Cash

http://online.wsj.com/article/SB1212..._us_whats_news

Ok, let's look at this sob story de jour.

1. This person apparently chose to retire at age 56.
2. This person apparently chose to retire at age 56 with insufficient savings.
3. This person apparently chose to work in a make-work feel-good social services job which provided her with her idea of suitable status and position, rather than in a more lucrative one that provides an actual service someone actually wants, though the work may be more difficult and non-rewarding in other ways. The idea of a "homelessness prevention" expert nearing homelessness herself is pretty good and very ironic proof of how useful such programs are. One's first duty before charity is self-sufficiency. You can't save a drowning victim if you never bothered to learn to swim.
4. She chose to retire in her 50's without sufficient insurance to cover medical expenses such as deductibles and co-pays, knowing full well that this is a vulnerable time in terms of obtaining coverage and the probability of requring expensive care, till medicare kicks in at age 65.
5. She retired knowing that she had a life expectancy of another 25 years.
6. She has 3 grown children she's hoping to leave $250,000 to, but can't live with or obtain financial help from one or more of them?
7. She chose to live in one of the most expensive cities in the USA until forced to move. Millions of Americans toil in mundane towns w/o picturesque views and quaint atmosphere, not out of choice, but because they're not foolish enough to think they can afford San Francisco on a modest income.
8. She chose to take the $45K from JG Wentworth. Making payments of just $113/mo for 11 years is about $15,000 in premiums paid. That sounds like a pretty good investment to me! That's something like 6 times her average investment returned in just 11 years. Ironically this is probably the best financial move she made in her life, assuming you don't consider an early death and her heirs collecting $250K a smarter move. Normally buying insurance as a path to wealth is a dumb move, looks like she got lucky here and the insurer had an actuary with a C- average in school.

I'm assuming the piece was written not only to illustrate hard times but to suck some sympathy for this person out of readers.

Part of the reason our economy is in the mess its in now is this misplaced sense of responsibility for the bad decision making of others. The implied idea seems to be that somehow we must all chip in to cover for fools who make bad choices so they can do whatever they choose. Knowing we stand ready as a safety net encourages improper financial planning and use of money over time, and is a big reason the dollar isn't worth what it was and our economic future is saddled with big problems concerning entitlements and obligations. The fact is, we're a wealthy nation, but we were never so wealthy that the burden can be carried by a small minority of the productive. It ignores human nature's tendency to seek the path of least resistance. In the end we'll all be taken down by it if we don't wise up.

My in-laws had relatively modest jobs, yet they raised 5 children, sent 2 of them to college, and worked full time till age 70. Both over 70, they continue to work part time for the "extras" like vacation trips. The father in law has diabetes, has skin missing on both feet, has to hobble around in special padded sandals, and still manages it and even seems to enjoy it. What's this lady's problem?

And the other examples in the column show that the author is going out of her way to avoid the obvious. These fools want it all and don't want to work for it or make any sacrifices. The guy lives in a $3 million home but has to borrow money? Another inherited a $1.8 Million home but doesn't want to sell it and needs to borrow just to pay bills? It's a type of insanity that apparently the WSJ doesn't want to even begin to address.

[FRED]

Re: WSJ: Pinched Consumers Scramble for Cash

Ok, let's look at this sob story de jour.

1. This person apparently chose to retire at age 56.
2. This person apparently chose to retire at age 56 with insufficient savings.
3. This person apparently chose to work in a make-work feel-good social services job which provided her with her idea of suitable status and position, rather than in a more lucrative one that provides an actual service someone actually wants, though the work may be more difficult and non-rewarding in other ways. The idea of a "homelessness prevention" expert nearing homelessness herself is pretty good and very ironic proof of how useful such programs are. One's first duty before charity is self-sufficiency. You can't save a drowning victim if you never bothered to learn to swim.
4. She chose to retire in her 50's without sufficient insurance to cover medical expenses such as deductibles and co-pays, knowing full well that this is a vulnerable time in terms of obtaining coverage and the probability of requring expensive care, till medicare kicks in at age 65.
5. She retired knowing that she had a life expectancy of another 25 years.
6. She has 3 grown children she's hoping to leave $250,000 to, but can't live with or obtain financial help from one or more of them?
7. She chose to live in one of the most expensive cities in the USA until forced to move. Millions of Americans toil in mundane towns w/o picturesque views and quaint atmosphere, not out of choice, but because they're not foolish enough to think they can afford San Francisco on a modest income.
8. She chose to take the $45K from JG Wentworth. Making payments of just $113/mo for 11 years is about $15,000 in premiums paid. That sounds like a pretty good investment to me! That's something like 6 times her average investment returned in just 11 years. Ironically this is probably the best financial move she made in her life, assuming you don't consider an early death and her heirs collecting $250K a smarter move. Normally buying insurance as a path to wealth is a dumb move, looks like she got lucky here and the insurer had an actuary with a C- average in school.

I'm assuming the piece was written not only to illustrate hard times but to suck some sympathy for this person out of readers.

Part of the reason our economy is in the mess its in now is this misplaced sense of responsibility for the bad decision making of others. The implied idea seems to be that somehow we must all chip in to cover for fools who make bad choices so they can do whatever they choose. Knowing we stand ready as a safety net encourages improper financial planning and use of money over time, and is a big reason the dollar isn't worth what it was and our economic future is saddled with big problems concerning entitlements and obligations. The fact is, we're a wealthy nation, but we were never so wealthy that the burden can be carried by a small minority of the productive. It ignores human nature's tendency to seek the path of least resistance. In the end we'll all be taken down by it if we don't wise up.

My in-laws had relatively modest jobs, yet they raised 5 children, sent 2 of them to college, and worked full time till age 70. Both over 70, they continue to work part time for the "extras" like vacation trips. The father in law has diabetes, has skin missing on both feet, has to hobble around in special padded sandals, and still manages it and even seems to enjoy it. What's this lady's problem?

And the other examples in the column show that the author is going out of her way to avoid the obvious. These fools want it all and don't want to work for it or make any sacrifices. The guy lives in a $3 million home but has to borrow money? Another inherited a $1.8 Million home but doesn't want to sell it and needs to borrow just to pay bills? It's a type of insanity that apparently the WSJ doesn't want to even begin to address.

Fine member AntiSpin on a MSM story. Mind if we post it as such?

[jk]

Re: Americans: Broke, Unload Prized Belongings to Make Ends Meet

She chose to take the $45K from JG Wentworth. Making payments of just $113/mo for 11 years is about $15,000 in premiums paid. That sounds like a pretty good investment to me! That's something like 6 times her average investment returned in just 11 years. Ironically this is probably the best financial move she made in her life, assuming you don't consider an early death and her heirs collecting $250K a smarter move. Normally buying insurance as a path to wealth is a dumb move, looks like she got lucky here and the insurer had an actuary with a C- average in school.

my guess is that her health problems dropped her life expectancy enough to make the purchase price reasonable. i'm not sure we can call that "get[ting] lucky."

[Guest]

Re: WSJ: Pinched Consumers Scramble for Cash

Fine member AntiSpin on a MSM story. Mind if we post it as such?

Sure.

While you're at it, check out this story. http://news.yahoo.com/s/ap/20080604/...ple_ed_mcmahon

When a guy who is on TV for decades, and who works into his 80's, lives in a multimillion dollar home, and is still having a hard time making a mortgage payment, you know there is something really sick with the national culture and attitude towards debt.

[tree]

Re: Americans: Broke, Unload Prized Belongings to Make Ends Meet

"...you know there is something really sick with the national culture and attitude towards debt."

Ok, maybe this is the case. And where does this attitude toward debt/entitlement come from?

A lot comes from the banks via their credit card commercials, I think. People aren't that smart -- they're vulnerable to advertising and consumerism. That's the American way, thanks to our pathetic public schooling.

Personally, I don't buy all this work-till-you-drop, isn't-it- great-to-live-a-dull-and-ugly-little-life-in-the-boonies stuff. But people do have to learn how to leave within their means, whatever they may be, and plan going forward.

What about teaching 8th grade algebra through a textbook on personal finances -- nationwide? A Commie plot!

Lately I wonder whether this site is being trolled by the financial services industry. All this stuff about righteous seniors working ill until they drop dead -- I read the same thing the other week and it's getting repetitive.

Meanwhile, the bankers are all in Swiss Francs with the jets idling on the tarmac.

[flintlock]

Re: Americans: Broke, Unload Prized Belongings to Make Ends Meet

Retiring to a life of leisure 25 years before you die is a very recent phenomenon in the scope of human history. Yet some seem to feel entitled to it.

[dbarberic]

Re: WSJ: Pinched Consumers Scramble for Cash

J.G. Wentworth; HA. Those "It's my money and I want it now!" commercials drive me nuts.

So... where can I score one of those cheap Rolexs being pawned by an ex-mortgage broker or realtor?

[GRG55]

Re: Americans: Broke, Unload Prized Belongings to Make Ends Meet

"...A lot comes from the banks via their credit card commercials, I think. People aren't that smart -- they're vulnerable to advertising and consumerism. That's the American way, thanks to our pathetic public schooling...

...What about teaching 8th grade algebra through a textbook on personal finances -- nationwide? A Commie plot!

Starving Steve and I had an exchange on this topic a while back and, as he's a teacher, I thought he had some interesting insight along the same lines as your expressed sentiments about teaching some of these skills in schools.

...Meanwhile, the bankers are all in Swiss Francs with the jets idling on the tarmac.

Probably better than having all the Swiss Francs in the jets, and the bankers idle...:rolleyes: