Stock Markets Gains Tell Us to Repay Debt, Not to Write it Off Through Bankruptcy
If we look at the latest stock market activity, with the S&P 500 up more than 40% since the March lows, people looking for ways to repay debt are facing an interesting dilemma.
Although interest in debt removal, debt elimination plans, and other debt settlement information has peaked over the last couple years, people with debt trouble should really evaluate positive ways to repay debt.
Here is why.
Stock Market Returns Are Leading Indicators We hear all of the time about leading and lagging indicators.
A leading indicator tells us what is expected to happen (higher stock market returns suggest companies are expected to make more money).
Lagging indicators tell us what has already happened but is only surfacing now -- for instance, the statistic on higher bankruptcy filings tell us that more people were unable to repay debt.
It does not mean that they cannot repay debt today, but when they filed they had no other means.
With this in mind, with so many companies expected to become more profitable going forward, it seems employment expectations should improve as companies spend on expansion and other plans.
Instead of looking up debt settlement information, which will damage credit, looking at more creative ways to repay debt might make more sense.
Higher Returns Means More "Wealth" In The System This time around, the recession was blamed on a housing bubble that saw many people lose tremendous equity in their homes and, losing their job, having to sell at a loss.
This caused an abundance of supply, further depressing house prices.
Bottom line is that a lot of people invested a lot in their homes and the homes lost their value, people weren't spending as much.
This in turn, impacted stock prices.
People were more interested in ways to repay debt then in ways to get deeper in debt.
There is another type of investment, however, and that is stock investments.
When markets start gaining, people become wealthier as a result and some of this wealth gets transferred into the system as people make purchases.
Instead of drawing out equity from their home, they draw equity from their investments.
(This was also blamed for the short recession that followed the Tech Bubble in the early years of 2000).
The markets give us a lot of positive news about our how we can repay debt and start living better.
With this information in mind, people are wise to forget about learning more about debt settlement and start finding ways to make some short-term sacrifices and repay debt so that, when their finances finally turn around, they can enjoy the benefits of stronger credit.
Although interest in debt removal, debt elimination plans, and other debt settlement information has peaked over the last couple years, people with debt trouble should really evaluate positive ways to repay debt.
Here is why.
Stock Market Returns Are Leading Indicators We hear all of the time about leading and lagging indicators.
A leading indicator tells us what is expected to happen (higher stock market returns suggest companies are expected to make more money).
Lagging indicators tell us what has already happened but is only surfacing now -- for instance, the statistic on higher bankruptcy filings tell us that more people were unable to repay debt.
It does not mean that they cannot repay debt today, but when they filed they had no other means.
With this in mind, with so many companies expected to become more profitable going forward, it seems employment expectations should improve as companies spend on expansion and other plans.
Instead of looking up debt settlement information, which will damage credit, looking at more creative ways to repay debt might make more sense.
Higher Returns Means More "Wealth" In The System This time around, the recession was blamed on a housing bubble that saw many people lose tremendous equity in their homes and, losing their job, having to sell at a loss.
This caused an abundance of supply, further depressing house prices.
Bottom line is that a lot of people invested a lot in their homes and the homes lost their value, people weren't spending as much.
This in turn, impacted stock prices.
People were more interested in ways to repay debt then in ways to get deeper in debt.
There is another type of investment, however, and that is stock investments.
When markets start gaining, people become wealthier as a result and some of this wealth gets transferred into the system as people make purchases.
Instead of drawing out equity from their home, they draw equity from their investments.
(This was also blamed for the short recession that followed the Tech Bubble in the early years of 2000).
The markets give us a lot of positive news about our how we can repay debt and start living better.
With this information in mind, people are wise to forget about learning more about debt settlement and start finding ways to make some short-term sacrifices and repay debt so that, when their finances finally turn around, they can enjoy the benefits of stronger credit.
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