Chapter 19 3. The days when you can’t borrow money

●What should consumers do if they cannot borrow money? ●As long as there is no borrowing, the US consumer market will shrink immediately. ●The biggest reason for the decline in economic growth rate is the shrinking of the consumer market, because ordinary people cannot borrow money. The problem is extremely serious at this time, please think about it, what if consumers cannot borrow money?And I will give you another data, the proportion of debt consumption of American households, that is, the proportion of American households borrowing money.They account for as much as 95% of GDP.The United States is a country that mainly borrows money, so the debt ratio of American households is as high as 95% of GDP.The traditional virtues of us Chinese include living within our means, and we don’t like to borrow too much money, so we only have 13%.But it is a habit for Americans to borrow money, and they have to borrow money, and they borrow money on any occasion.Even a meal of 10 dollars has to be borrowed and swiped with a credit card.Have you ever thought about what to do if you can't borrow money someday?How to buy home appliances?How to buy a car?How do you live by credit card when the bank reduces the credit card limit?All consumer loans are not loaned out. As long as consumer loans are not released, Americans will not be able to buy cars, televisions, refrigerators, and microwave ovens. It's as simple as that.

If you get half of the credit card limit, your usual expenses, such as buying clothes and eating, will be cut in half, that's all.As long as there is no borrowing, the US consumer market will shrink immediately.And let me give you a statistic, do you know how important American consumption is?The development of the American economy basically depends on consumption.In other words, more than 70% of the US GDP is consumption.What if consumption decreases?Then, the U.S. economy will immediately decline.Therefore, the U.S. economic growth rate in the third quarter of 2008 was negative 0.5%, while the decline in the fourth quarter was as high as 3.8%.The biggest reason for the decline in economic growth rate is the shrinking of the consumer market, because ordinary people cannot borrow money.