Friday, April 24, 2009

Ramsey Reflections, Part 2

Continuing reflections on Dave Ramsey's Town Hall for Hope...

Takeaway #2: Don't Go Hysteric!

At this point, we're not looking at a full-blown depression. So we have 4% more people out of work. Granted, many are hurting, and we don't want to minimize that. But we're not all standing in soup lines, the stock market hasn't tanked nearly as much as in the Great Depression, and the worst of the foreclosures are restricted to five states.

Ramsey's point? Employment is well over 90%. Scramble around and find work! Get new training for new jobs! As Solomon said three thousand years ago, "The diligent prosper." Sitting around sulking and watching negative news doesn't qualify as "diligent." Get out and make something happen. That's what Americans are known for.

Takeaway #3: Look for the Silver Lining

Yes, it's a storm. But storms often have silver linings.

First, recessions and depressions have a way of shaking us up and re-ordering our priorities. Our grandparents, who experienced The Great Depression, might pull out an old nail and use it again. Many of us have become wasteful and flabby.

Second, recessions weed out the slackers in our fields. Some serious realtors are selling properties again, and have less competition.

Third, recessions make us work harder at serving our customers. A restaurant that fails to provide great food while making customers feel special deserves to die. Money is simply a certificate of appreciation for a great service or a great product. If you're providing neither, prepare to be run over by those who do.

Fourth, a recession can bring us back to our senses about wise money management. Now is a great time to reintroduce a lost word in the English language: "No!"

So someone wants you to loan them money to buy a house. But they're broke. You say, "No. You're broke. You can't afford a house." When broke people buy houses, they become broker. That's why they call the people who seal the deals "brokers."

So your teenager doesn't have a decent job but wants you to buy him a Corvette. You say, "No. You can't afford a Corvette. Why should I help you to buy one?"

More to come...

This post by J. Steve Miller, author of Enjoy Your Money: How to Make It, Save It, Invest It and Give It.

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