Building on to the discussion topic for yesterday, it’s important to write a piece on common sense, and this applies to everyone, whether you’re a trader or not, but I have to do it. Economics is built on theories, Keynesian models and so forth. I don’t want to get into much details. The same theories have justified the use of credit, banking institutions are willing to offer loans against security provided you have the ability to pay, nothing wrong with that. I have a problem with consumer spending habits, especially the use of credit cards, basically, spending money you haven’t earned. Putting yourself in an endless cycle of debt repayment schedule with interest rates on top of that for something you should have avoided by paying in cash. Common sense.

One of the greatest men I respect, the former president of the United States, Mr. Obama, had to spend a substantial amount of time in office repaying his student loan debt. You know you have an obligation to pay upon receiving your first job, but why do most people default? YES, those constant Higher Education Loans Board (HELB) reminder alerts, we complain about them, I once complained about them, but then I realized it’s my responsibility to settle that before I am declined access to financial services by some lending institutions for something I can make partial repayments on. Common sense.

The global economic recession and melt down majorly caused by the mortgage use, I like how one economist put it, institutions devising a model to “make” you own a house now and allocate an insignificant amount of money you should pay over a duration of time you can’t explain. Yes, we know you want to raise your family in a good home, that’s okay, but why put your kids/beneficiaries at the risk of repaying a loan you took God forbid you die while you can rent or build a house making small installments from your own earnings? Common sense.

The constant urge to keep up with the Jones, competing with your peers, buying the latest model of a car, taking your kids to schools you can’t afford, don’t get me wrong, invest in your kid’s education, it’s the best inheritance you can give to them, and you owe it to them for bringing them into the world, but don’t do it to show off or feel obligated to do so because you want to be at par with the rest of the world. Common sense.
I can go on and on, but let me stop at that for today, I don’t want to get into using a perfume or a deodorant, lol.

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