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Red River Valley | Farmerbyron - most were spending it look at credit card debt, this is a money from thin air- from March to August I had 4 credit cards call me up to either cancel or reduce the credit limits two of these cards had not been used in over two years ( they were taken out to take advantage of 0% interest promotions) and to other two had limits up to $25,000 that were cut by as much as 75% because they had not been used above that limit and carry very small month to month balances. These moves did not bother me as living in small town credit cards are not really used much but remember that some people were living large with credit cards. Then how many city people do you know that came into your area and bought some hunting land by taking out a second or third mortage on their ever increasing home value. now think about how many big box lumber yards ( home improvement centers ) popped up in the last 10 yrs. as people took advantage of there ever increasing house value to remodle and upgrade their homes that with the second and third mortage were under water in reality and did not know it. The building boom that peaked in 2007 world wide was absulutly insane and lead to the first bubble in commads with the beleif that the world was running out of everything.
Quick question how many people have you heard that had a bunch of credit card debt and took out a second mortage to refinance there credit cards onto I have some family that live in the bigger cities in this area Grand Forks, Fargo and Minn/St.Paul that know pep's or have done just this themselves. that is what I mean by creating money out of thin air. think about this you take your lovely wife or girlfreind out to dinner and put it on your credit card than with too much CC debt you have to refiance your house because interest rates are less than 20% on your house VS your CC so now you have finaced that dinner for 20 yrs. as part of your house mortage, and btw you are upside down after one year on your house. this is why spending habits are changing not because we want to but because we have to.
got a little long but trying to show examples of how credit out of thin air was caused. | |
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