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About money, banks and us. May 31, 2010

Posted by @Karen_Fu in bank, change.
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pic source: silvertailsystems.wordpress.com

As much as we blame banks for the global financial crisis, a better way would be to design our ways to avoid such crisis. Being financially self-sufficient is one way;  being wise about how to use the banks as a leverage is another. Each bank, despite being one of the most ‘money’ focused businsses around, fortunately has its merits for us to smartly use.

I was reading about credit card crisis and the first thought was that we are over reliant on borrowing to live our lives well. Credit itself is actually a vice not a virtue. Credit cards are often given too much honor to the point that many people have taken the image that owning credit cards and spending via credit cards is a prestige.

I often like to observe trends, and I see a lot of teenagers, fresh graduates and professionals especially, often live beyond their means by splurging on items that they actually cannot afford. Banks are afterall businesses. And many will look at how much they can get out of you given your income. No banks will lend you money when you don’t have the money.

People often don’t think about making the money before achieving their goals which is the exact fomula for loosing money.  Banks can be our friends if we the consumers make wise and smart choices.

The global crisis itself is indirectly caused by us who actually fuel the problem by investing in high risk profile investments that we actually cannot afford.

How do we change this idea requires one’s determinatoin to refrain from borrowing / investing wrongly in the first place. Where could we get the right financial education ? We need to use our wisdom and intellect to read what we are told. From there, make reasonable deductions of what to listen and how to move on. Be sure to remember that debt is a sin, not an honor; and make sure that our bank/s are at our service and interests by asking smart Qs to get our As about money.

Wish to write more, but as my time limits; this is the only time at night that I can write… hope this is well taken and make some intrinsic sense about money.

Posted via web from Daring to Posterous-ly Change

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Banks, us and money… April 27, 2009

Posted by @Karen_Fu in bank, change.
2 comments

Instead of changing the banks, maybe we need to change the way we manage money. The ripple effect coming from banks is affecting everyone. Recent news have reaffirmed my thoughts on personal financial management as well as how businesses should run. And I do believe the whole banking industry will get a lot worse before it gets better.   Many times over, I believe that most of the troubled banks in contrast of the auto industry would need to just go bust or downsize for the main reason that it is not sustainable for them to continue hanging on on a distressed note. From a consumer level, the problem arises mainly from greed and spiraling credit debt. From a business point, it is all about triming down greed and triming down failing business sectors and derive new ways in borrowing and lending. We need to change the way service is delivered to customers. That includes handling materialism in an optimal way (since eliminating materialism is impossible and also impractical). Credible lending to useful investments that are ethical and healthy. Basically we need to wind back to basics of saving and buying responsibly. Borrowing to live well on one hand improves the living quality in the short term. But it fails in the long run. Debt on good paying investments, which will pay itself after the selling is more than fine. But sadly this is not the case. I have personally witnessed many people who are spending way beyond their means. Just recently, one local man in his late 60s was paying his credit cards’ debt at a foreign bank’s self banking loby. I was there to deposit and he was there trying to figure out how to pay through the automated machine, which was entirely in English. My eyes popped as I saw the few statements he had in his wrinkled hands — all mounting to a scary sum of US$16000 that month ! And he was not a well-off person to start off with. Maybe he was paying for his family, but I thought that kind of bills is really unncessary. Perhaps the current financial turmoil is a good time to clean the entire market and start anew.  I have posted some thoughts on ‘credit’ and ‘products’ over on my other blog about it. I think consumption does need changing. It is a matter of how brave we are to change. It doesn’t mean a cut in living quality. But a cut on things that we really do not need and spare some time and effort on those areas that we need to keep us soulfully and physcially healthy. It makes a lot more sense if we could sit down quietly and recount what is supposed to go out of our lives and what is supposed to be included. If we care to face the deal and make the necessary adjustments, we actually do not need to fear if the banks do fail. Then life would be more in control with a way more wholesome and debt free !

reference:

My other blog that mentions about credit and product.

The Stress Test on Banks

New York Times on Banks liquidity

Here’s a stupid way to fix the banks: Change the rules!