Beat the Credit Crunch

This is probably the most important part of adopting a new lifestyle, and may prove to be the toughest for most people. Consider the economy, which we are told is in ruins, and the end of civilisation is nigh. What is the economy, and what does it actually mean to us? I'm no economist, and this is way out of my field really, but I'm trying to make sense of it all. As far as I can see, economic growth is fuelled by consumer spending. As people spend more money, more shops can open up to sell them stuff, and therfore more people have jobs, and then more people have money to spend etc. I think this is the basis of economic growth, which we are told is vital to our everyday living.

There are clearly problems with economic growth though. Money cannot appear out of thin air, regardless of what the mathemagicians in The City tell us. Take oil for exapmle. The cost of oil has steadily risen over the last few years. This is not because it's running out, nor is it because of a surge in demand from developing countries. Oil prices have risen because stock traders are buying up, say, 10,000 barrels at a low price, and then holding onto them. This oil can't then be used, so there is less oil available, and the price rises. Then when the price gets higher, the traders sell their oil, and make a profit. Money from thin air! No, actually. The rise in price means that your energy bills are higher, and the price you pay at the pump is higher. Bankers haven't made money from thin air, they've made money by taking it out of your pocket. Now everyone is selling stocks, and low and behold the price of oil is dropping. This isn't because India has stopped using electricity, it's because the market is now flooded with oil that was being held in the hope that the price would rise.

Has economic growth benefitted you then? If it means everything is more expensive than it used to be? As the price of commodities rises, inevitably there will come an equilibrium point where people stop spending money. We have now reached that point, and the news today shows an economic decline, rather than growth. It seems, then, there is no escaping a boom and bust economy, for every boom there must be a bust. It is folly to suggest other wise.

A further example of the folly of economic growth is pretty obvious if you stop and think about it. Growth involves increased usage of resources. Yet we live on a ball surrounded by vacuum. There are a finite number of resources on the ball. It is glaringly obvious that we cannot continue to use more and more resources indefinitely, if the resources are not replenished. Currently there are no plans to harvest asteroids, or the moon, so we're stuck here. We must therefore limit the amount we consume, and recycle as much as possible. This has nothing to do with whether you believe in global warming or not, it is a simple fact that we have a finite amount of resources available, so it is not possible to have infinite growth.

How do you escape it then, as a person on the street? Pretty easy really, but it takes will power and determination. Just stop buying things. Let others worry about economic growth, it's for chumps anyway.