The only way a financial bubble can end is to collapse. But the more obvious it becomes that the economy is on an unsustainable path, the more vested interests will try to extend it, making the crash even worse.
As a result, even though it is going to be grim, signs that they are no longer going to be able to sustain the economy are actually good news.
Did you know that 61 percent of Millennials don’t own one credit card?
Younger shoppers were especially unlikely to use credit cards; 48% of millennials said they would do most of their holiday shopping with debit cards, and 36% said they preferred cash. Mobile payments are still unpopular; only 14% of U.S. adults with smartphones or similar devices plan to make even one mobile payment during the holiday season, according to Bankrate.
Millennials in general tend to avoid credit cards more than previous generations have done; 63% of millennials don’t own a single credit card, according to a separate Bankrate survey in 2014. “They grew up in the Great Recession and saw what happened with their parents,” Cetera said. “They don’t ever want to be in a situation where they’re in debt. They’re shying away from high-interest loans, essentially.”
Without using credit, millennials will never sustain the consumer behavior on which our businesses depend. The debt pyramid scheme is about to come to an end.
But our economic experts can’t think of a world that doesn’t run on consumer spending–and therefore on debt. The news stories about the holiday economy are always fixated on spending. If you read about earlier economic history, usually you will read about the rise of the middle class as technology and a more efficient division of labor makes goods more affordable. But now the only source of prosperity is understood as people simply spending more. This is obviously unsustainable.
And millennials are refusing to sustain it.
Children whose parents are being destroyed by debt now, will keep those memories for a long time.
Attitudes are the key force actually. It took two generations for memories of the great depression to go away.
And it will take at least a generation for millennials who saw their parents lose their homes or get into huge fights over money for those memories to vanish.
The good news here is, despite economic hardship, the next generation may escape the slavery of debt. Hopefully, when they, their children, and their grandchildren rebuild the economy they will remember to avoid the debt trap,