Wednesday, April 30, 2008
The sad stories of Americans squeezed by rising consumer prices, tighter lending standards, and falling home prices are beginning to saturate the mainstream media.
This report from the Associated Press is pretty typical, though the smiles on the faces of the couple below is rather odd - maybe they don't yet realize that they'll be lucky to get ten cents on the dollar for that pile of junk in front of them:
Struggling with mounting debt and rising prices, faced with the toughest economic times since the early 1990s, Americans are selling prized possessions online and at flea markets at alarming rates.By the millions, once-proud and once-spendthrift consumers are now looking in the mirror and saying to themselves, "What was I thinking? I lived through the biggest asset bubble in history, buying all sorts of useless junk I don't need, and now all I have to show for it is a big pile of debt."
To meet higher gas, food and prescription drug bills, they are selling off grandmother's dishes and their own belongings. Some of the household purging has been extremely painful — families forced to part with heirlooms.
"This is not about downsizing. It's about needing gas money," said Nancy Baughman, founder of eBizAuctions, an online auction service she runs out of her garage in Raleigh, N.C. One former affluent customer is now unemployed and had to unload Hermes leather jackets and Versace jeans and silk shirts.
Earlier this decade, people tapped their inflated home equity and credit cards to fuel a buying binge. Now, slumping home values and a credit crisis have sapped sources of cash.
Meanwhile, soaring gas and food prices haven't kept pace with meager wage growth. Gas prices have already hit $4 per gallon in some places, and that could become more widespread this summer. The weakening job market is another big worry.
Well, until it sells, they still have all the useless junk.