Are Americans giving up credit for paying as they go?

The Associated Press

Farewell, easy credit.

Featured Topic | Posted 41 weeks 4 days ago

Are Americans giving up credit for paying as they go?

Call it the new age of austerity. Call it the new belt-tightening. Call it the return of thrift. But whatever you do, don't call it a recession. Not yet.

Still, with a slowing economy in mind, more Americans are beginning to rein in their credit-card spending, putting of big purchases in favor of saving and paying down debt. “The long collapse in the United States savings rate is over,” said Ethan S. Harris, chief U.S. economist for Lehman Brothers. “People are going to start saving the old-fashioned way, rather than letting the stock market and rising home values do it for them.”

Is constricting credit the medicine Americans need? Or is the decline in consumer confidence a guarantee of recession?

Ben likes: Frugality and thrift make a necessary comeback

Randall Parker/Parapundit

The American trade deficit is not sustainable and has enabled many people to live beyond their means. The down turn in housing prices, the decline in the dollar, and the recession might finally cause a turning point where people have to start living on what they earn.

Joel likes: My big, fat, unpaid credit card bill

Sarah Hepola/Salon

All the quick fixes I had been mulling over were not going to work. Debt consolidation was too expensive. Defaulting and bankruptcy would torpedo my credit rating and set me back for years. I couldn't ask the credit card companies to lower my APR until I got my payments under control and raised my credit score, which would take two months of no-s**t efforts. I was going to have to stare down my debt the old-fashioned way: I was going to have to pay it.