Neal's Workshop

An article from the UK's The Independent titled, Britain becomes 'never, never land' as personal debt runs out of control, included the following anecdote by Alice Douglas. One can't help but imagine any number of Americans telling the same story about the past ten, twenty or thirty years here in the U.S. It's a story of what happens when money isn't real:

Follow up:

Alice Douglas, 42, writer: 'We were happy with a £60 TV. Now we spend £1,500'

"Seven years ago, I moved to Wales for a change of lifestyle," says Alice Douglas, 42, a writer from Snowdonia. "I bought a 4,000 sq ft church for £54,000, which was incredibly cheap, because it needed renovation work, but I had never done a big building project before. I thought I'd be able to do the structural work for £80,000 but I've had to spend £300,000. I didn't think of the cost, and even things like floor tiles for the kitchen ended up costing £5,000 because they were limestone, and I spent £25,000 on windows.

"I used every credit card I could get. At one point, I had 10 different credit cards with £8,000 on most of them, so that my debt was up to £60,000. It was all about to collapse until my mortgage company valued my property, which has massively increased in price.

"I still have about £30,000 on my credit cards, but I've just learned to juggle them. Once you've got them, there's too much temptation and you get used to a lifestyle where you want to have lots of things. We used to be happy with a £60 television set, but now we spend £1,500 on a 38-inch LCD.

"You get sucked into it, and get used to spending large amounts without thinking about it, because it's on a card. It does make a different [sic] because it doesn't feel like real money. If it did feel real, it would feel obscene. I went to London recently and spent £3,000 in Whistles, on clothes. I'm about to buy another property with an 85 per cent mortgage and I'll get the deposit on credit card.

"It's a gamble but it could pay off. If you're shrewd, you can use it to your advantage. My credit rating is very good because I borrow a lot but I'm able to make my payments. It used to stress me out but now I think, if I lose everything, it wouldn't be the end of the world."

When money isn't real, why should it feel real?

When was the last time you held a solid silver or gold coin and marveled at what money used to be? When did you last make a big purchase without the option - nay, the expectation - that you would finance it?

There's a reason money doesn't "feel real" anymore: the modern money in which we deal exists outside the realm of assets (Financial, real or otherwise) because it is inherently worthless. The scarcity of money in our fractioned, fiat'ed system is dependent on the whims of governments, banks and/or creditors. When money is so poorly controlled, which is to say that it isn't controlled, at all, what are we to do but trade money for things that are controlled inherently by natural scarcity? When money isn't real, debt isn't either.

In such a system, human action is predictable: we desire increasingly to exchange the worthless for the valuable until our desire escalates into a hysteric rush to dump dollars for assets.

When that mad dash starts - when the music stops - will you be left standing?