Thursday, December 22, 2016

Pandora and Debt Culture

Streaming music is pretty neat, but the ads are somewhat annoying.   The ads, however, give an insight as to how your average American lives.

One of the nice things about a smart phone is the availability of apps like Pandora.   One reason I got a cheap Samsung Galaxy 4 (used) was so I could use the Pandora and UVO apps, which are part of the Hamster's navigation system.  And for the most part, these apps work well.

You can pay  $5 a month to stream Pandora ad-free.   But the ads are about 15 seconds in length (or less) and only about after every 3rd to 5th song, so they are not too intrusive.   What is interesting about them though, is the form and content.

Each ad features the voice of a chipper young girl with a sort of combined New Jersey and Valley Girl accent - like, you know what I mean?   And in each ad, she cheerfully promotes debt culture.   One ad is for debt consolidation, and the other for mortgage refinancing.   I think both might be for the same online debt company.

There appear to be no other ads on the service, other than the visual ads for Cialis.   So Americans are heavily in debt, apparently and can't get it up as a result.

It struck me as odd that so many people are in debt.  How many?  About 80% according to the credit companies who can monitor such things.  Of course many of us have debts on a day-to-day basis.  If you have a credit card, you are technically "in debt" all the time if you use it - even if you pay off the balance every month.  But that is not what I am talking about.

What I am talking about is chronic, crippling debt that people see no way out of.   For example, endless mortgages that are refinanced time and time again to pay off short-term debts and suck yet more equity out of a home that will likely never sell for more than the balance on the loan.  Or the perpetual credit card debt - often as little as a few thousand dollars - that the holder cannot ever seem to pay off, as they are living "paycheck to paycheck" and cannot afford a few extra bucks to pay more than the minimum on their card.

Debt has changed the way we think about money in this country.   For most people, debt is a way of life, and they measure their financial health in terms of the almighty credit score - which is an indicia of how much more debt they can assume.

Our government is in debt, of course, and we measure the strength of our economy less and less by the GDP than by our debt load and prevailing interest rates.   We wait with bated breath for the latest prognostications from "The Fed" as to what the prime rate will be - the rate at which banks borrow money.

Our entire economy is structured around debt, so it is no surprise that when we as individuals think about our finances, we think about it in terms of debt.

Our new President purports to be a Billionaire - but much of his vaunted Real Estate projects and Casinos were built using debt - much of which he defaulted on.   For our debt country and debt generation, he is the perfect President.  He promises to increase the national debt to pay for infrastructure programs to "create jobs".  And he promises to loosen the purse strings on lending and thus allow Americans to rack up more debt - to buy shiny new things and thus bootstrap the economy.

It's a debt kind of world, we just live in it.