Slump time has arrived says Lee Wei Ling, director of the National Neuroscience Institute of Singapore and Lee Kuan Yew's daughter (Lee Kuan Yew is the former Prime Minister of Singapore). This is a good read and there is much merit in what the author says.
John and Mary Doe (husband and wife) are making $90K each. John loses his job. The family must now manage to live with Mary's salary. They sit around the kitchen table for a family discussion.
Since John is at home, they dispense with the baby-sitting service. They both cancel memberships at the expensive clubs and join the YMCA/YWCA for 1/10th the cost. Mary gives up her weekly shopping trip to the upscale clothing store. Clothes with have a tear are mended rather than thrown away. The Doe family gives up their weekly dinner outing and the purchase of expensive coffee's from the local Starbucks. Dance classes are canceled and they learn to dance by looking at some video's from the local library. All subscriptions for newspapers and magazines are canceled and they get the news from the Internet. With a lot of regret they sell their third automobile, the SUV which is a gas guzzler. Membership at the private golf club is replaced with golf at the municipal golf course. After all this, John and Mary are surprised that they are able to cut down their living expenses by almost one-half without lowering the quality of their lives. Although, this is fictional, it is what exactly is happening to many families today.
Unfortunately, when thousands of Doe's do not spend business also slumps. So everyone focuses on necessities and business only produce necessities that people want. At least, the slump will teach (hopefully) people to live within their means and not in excess of their earning capacity. Americans' saving more, spending less has begun.
Comments