Credit Crisis

Last night I watched the President pontificate on how our nation will come together and lift itself out of recession. This little rant won't be a dissection of that speech, I promise. I only want to point out one glaring fact: any serious conversation today about helping the economy is a credit based conversation. Credit is considered the "life blood" of the economy or the "engine" that drives our financial system.

I suggest there is another way. It is called asset based business. The concept is really simple, you only spend money you have. Duh! This is the same concept that millions of Americans have used through the years to provide for their families and accumulate wealth. It's financially solid and Biblically accurate.

This week I visited with a woman whose husband was successful at building streams of income. He worked third shift for years. The job provided him a basic income and benefits. When he got off in the mornings he would come home and work to develop some land next to his home. He worked the land with a small lawn tractor and some homemade tools. As he completed portions of the land, he would either rent out the lots, put mobile homes on the them, or build small houses. When he died he left a thriving source of income for his wife and family. And he did it all by spending what he had at the time.

I'm not against all forms of credit. I do believe that borrowing money for things that go up in value is acceptable. However, borrowing less is always better. I have little confidence America will once again become an asset based economy. But businesses and individuals can. Those that do can succeed in even the most trying of times.

If the borrower is a slave to the lender, then Americans better learn to speak Cantonese.