The Mistake of Living Within Your Means


Many years ago I coined the phrase “Living within your money not your means”.

Having heard, then newly elected, President Barack Obama proclaim that we were a nation which should and will live within its means, I sat back to watch exactly what he meant. Over the next six years his spending pattern was to rival the totality of all the Presidents before. He demonstrated how we had the MEANS to be able to accomplish this Herculean task. Via the Federal Reserve we were able to create money out of thin air. Via a Congress, both Democrat and Republican, we were able to legislate programs that ensure that crony capitalism stayed alive and well. Via our Justice Department we made sure that all ran smoothly without any inconvenience such as a banker’s jail time.

Yes, we certainly had the MEANS.

Of course the issue of disaster, with his approach, is not if but when. For the individual, the same outcome can be assured if one lives within their means not their money. The means are all around us. Multiple credit cards are once again readily available. Sub-prime lending for housing and autos once thought extinguished has come back with a vengeance. Pay day loans and even hard money lending have made their way back to mainstream America, if they ever left. Student loans are as easy to come by as a fast food hamburger. Yes, it is not difficult to have a champagne diet on a beer pocketbook; after all, we have the means.

Finally, look how wealthy everyone has become, according to Janet Yellen, since the DOW has reached all time highs. On paper every “MEAN” American has watched their wealth grow immeasurably with the stock market. Wasn’t that the intention to make us all feel better? So why not spend it? Those are the MEANS.

Reality for most, however, is far different.

The MEANS perpetuated by Barack Obama and others is an illusion designed to trap most people in a quagmire of debt. Whether it is students just beginning or retirees near the end, living within your means ultimately brings a very bad resolution.

Living within your money, however, allows you a freedom of control and understanding that each day is yours and not subjugated to another (creditor).

It requires making choices and foregoing wants that have become needs. It also demands the fortitude to say “No, I can’t afford it”.

At the end of the day the only successful outcome is achieved not by living within your means but by living within your money.

Whether you are an individual or a Country.

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44th A Presidential Conspiracy
By William L. Tatro IV

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With his passion for economics Bill Tatro has been entertaining audiences on the radio and in seminars for decades. Bill is an economist that provides weekly paid content to subscribers, and offers a free daily "lite" version as well.