The Discredited Credit Card and the American Economic Down fall....

The Discredited Credit Card and the American Economic Down fall....

by Nisaar Y. Nadiadwala on Monday, August 8, 2011 at 1:37pm

A couple of decades back there was a time when an Indian or a Pakistani returning from America was considered to be a big man with a high status. Mothers used to rush to them with their daughters' proposals. Today the situation is rotated.. an 'America returned'  is a liability, either he has lost his job or wealth !!!

   Last week has seen the fall of not only the share index in ' Wall Street ' but along with it  the American reputation of being a financial giant has also taken a deep dive. I read Paul Krigman, noted American writer on current financial issues and I agree with his reasons for the down fall of American economy. The Americans have over spent their wealth, more than they can earn. In a simple man's language, their expenditure is based upon their hopes of the money that they are going to earn tomorrow. So, enters the credit card culture.. people having multiple credit cards, spending more than their income, flying to luxurious holidays, eating in expensive restaurants.....Now the economy is done with, exhausted of their spending capacity returning their loans amidst nightmares  of job insecurities, they are unable to spend money and when a whole nation refuses to put their hands in their pockets to spend then it is comes like a strong slap on the face of the economy which for a time being, looks pinkish and reddish. 

 The latest statistics from the Federal Reserve indicate that the total amount of consumer debt outstanding remained fairly steady in 2010.  The total amount of consumer debt in the United States stands at nearly $2.4 trillion.  Based on the 2010 Census statistics, that works out to be nearly $7,800 in debt for every man, woman and child that lives here in the U.S.

If you're saying to yourself - that that statistic doesn't seem quite so bad - keep this in mind:  We're talking about consumer credit, which does not include debt secured by real estate.  If you thought that number has debt associated with mortgages, it doesn't.

This data also tells us that Americans carried approximately $886 billion in credit card debt, and that number is expected to grow to a projected $1,177 billion by the end of 2010.  This works out to over $5,100 in credit card debt per cardholder (not household) and that number is expected to increase to over $6,500 by the end of 2010.According to information gathered by the US Census bureau, there were approximately 173 million credit card holders in the United States in 2006, and that number was projected to grow to 181 million Americans by the end of 2010.  These same Americans own approximately 1.5 billion cards, an average of nearly nine credit cards issued per credit card holder.(http://www.money-zine.com/Financial-Planning/Debt-Consolidation/Consumer-Debt-Statistics/)

 There are two things involved in this, first  the brotherhood with shaitan as Surah Isra says.. Extravagants are brothers of shaytan... and the second is 'a war with Allah and his Messenger for involving in Ribaa' (Surah bakarah ayah 278-279). Its time to throw away credit cards....

  Author : Nisaar Nadiadwala speaks and writes on soio-educational issues from Islamic perspective..He can be reached at nisaar_yusuf@yahoo.com

Source