The Problem With America's Economy

This past month, a very clear and simple explanation of what is wrong with our economy, came across my desk.  I recently cancelled a credit card, and made sure an old one was still active.  Being in business, I maintain proof of my expenses by using a credit card.  At the end of the year, between Paypal, a credit card, and bank statements from my business account, I'm still able to figure my own taxes and have proof of my deductible expenses.  I know some folks don't believe we should be using the current monetary exchange, but I'm not there at this time.  I figure as long as I'm filing with the IRS and rendering unto Caesar, I'll be using fiat currency, which includes credit cards.  There is no balance carried on my card, just documented proof of expense and payment.  I say all this for no real important reason, other than to clarify, I believe it is possible to be debt free and utilize the benefits of a credit card.

The other evening, after cancelling the one card, I called my the company with my old card and the young man who answered immediately informed me what a privilege it was to be speaking with someone who had maintained an account with the company for the number of years I have.  Truth be told, I've probably had this account more years than he's been alive!  At any rate, as he looked my account over, it seems I qualified for a new and better perk.  I listened and it did sound good, so we went through the process.  I received a letter confirming all that we had discussed and explaining my new status.

In this letter was also a credit report with my FICO score.  Upon reading the information, I did a Google search as to the category of my score.  As it turns out, I have an excellent FICO rating, but it isn't perfect.  It is, however; higher than Warren Buffet's is reported to be.  And that is just the tip of the ice berg in what is wrong with America's Economy.   Since my score was not perfect, a disclosure was included to inform me of the key factors that adversely affected my "excellent but less than perfect" credit score.

1.  Lack of recent installment loan information          translation:  I'm not in debt.

2.  Too few accounts                                                   again:  I'm not in debt

3.  No recent revolving balances                                       "          "

But wait, there's more.  Based upon my recent information in the account upgrade, I now have a credit limit that is nearly twice my annual income.  Now that I've officially seen this in writing, there is no doubt the economy is not improving.   My credit line is not based upon my ability to repay what I borrow. 

In a nutshell, having no debt is the official adverse factor in my credit rating, but I now qualify for a line of credit that would enable me to spend twice as much as my annual income.  This is to further "encourage" our consumer driven economy.  A quick search of consumer driven economy reveals that our spending is actually considered a part of the gross domestic product!  This is the epitome of "digging one's way out of a hole."