Newsweek’s cover story entitled “Stop Saving Now!“ has altered — more like adulterated — the classic image of Uncle Sam’s military recruitment poster “I Want You” into a spending recruitment post of “I Want You to Start Spending“.
I’m so against this type of irresponsible financial mentality that it irks me to my very core.
I realize that Newsweek is just trying to sell magazines by printing an inflammatory magazine cover — heaven forbid another publication should go out of business — but this would be almost humorous if I knew some poor fool might actually take it seriously.
You are indirectly helping the economy with your tax dollars. Since you are the proud shareholder of poorly managed companies like AIG and funding the UAW’s paychecks to build cars that no one is buying, you’re doing far more than main stream media will tell you. Without the federal government lending Corporate America your tax dollars, companies deemed “too big to fail” would be in bankruptcy court or have chains on their doors.
The U.S. economy is famous for boom & bust patterns. There is an old adage on Wall Street that says “We’re not sure what Americans will do, but we’re sure they’ll all do it at the same time”. We’re so plugged in to the news and constantly bombarded by cheesy advertisements that we’ve become programmed to act in herd like mentalities. We’re human, and it’s in our nature to go along with the crowd, but the ability to create rational thoughts should help us identify when we’ve crossed over into the land of excess and stop leveraging our paychecks to the breaking point.
Americans are only saving 5% of their paycheck. How in the world is saving money a bad thing considering we spent more than we made for multiple years. Any economy built on spendthrift consumers who buy possessions without saving money for a rainy day is NOT a healthy economy. Sorry guys (e.g. retailers, car companies, credit card financiers), the party’s over.
Truth is, we’re not some sort of robotic consumer machine. Even the most clueless of consumer drones have caught on that the economy sucks and saving some cash for a rainy day. Americans are now looking out for themselves and the financial security of their family instead of the giving more of their money to Church of Starbucks.
If Corporate America has gotten so fat that it requires consumers to spend every dollar they make, then it’s time to help them lose the excess weight. If they think it’s bad now, what would happen if we actually paid attention to personal finance articles like The 60% Solution (BTW one of the best personal finance articles ever written) where 60% of our annual salary goes to living expenses, only 10% goes for fun money, and the rest goes into savings.
So suck it up Corporate America. Things could be worse. Imagine a new cost-conscious America that rivals China’s national savings rate of 50%.
Wonder what would happen then?
What’s your take on this image? Does it make you a little angry that Uncle Sam’s message has been changed to justify the “Paradox of Thrift” argument? Do you think behavioral economics has gone completely astray and we’re sealing our fate by saving too much?