Rambling on a Saturday Night -- Absolutely Nothing To Do With The Bakken

I've seen these statistics before, presented elsewhere, with regard to household debt.

But seeing it again tonight allows me an opportunity to opine on the issue, something I thought about some months ago.

Here's the issue and the link: household debt ratios at its lowest since the 1990s. I think the reason is obvious. I figured it out months ago and folks are now starting to publicly write about it.

Debt is down because of the housing situation. Prior to the bubble, folks were in over their heads with mortgages.

There was a push by former administrations (if I remember correctly, it began in the Clinton administration, but the Bush administration continued) to advocate home ownership, removing obstacles, etc., and the government succeeded in its goal. More people than ever owned homes.

Everyone knows the rest of the story.

Now that folks are out from under those miserable mortgages, debt ratios have improved and cash flow for many families has improved significantly. Everyone blames the current economic crisis on the housing debacle. I'm not convinced. I think we are past that. The economic crisis is now due to other reasons.

I knew an individual in my former life who chose to live in an apartment his entire life, along with his working wife. Money was not an issue; they just chose apartment living for reasons other than monetary. I always thought he/she were making a mistake. I never understood why someone would rent rather than buy. I was sucked in like millions of other Americans by the government saying how buying one's home was the way to go.

Folks do not know how expensive a home is until they buy one. There was a movie on this many years ago, called the "Money Pit." Well before the house is paid for, maintenance costs start to rise. Property taxes definitely rise.

I have owned, and I have rented. Up until the bubble burst, I was a "believer" in home ownership. After the bubble burst, I understood better why my colleague and his wife chose to rent all those years.