My Recessionary Confessional

Now that the economic data have stopped cliff diving we can all catch our breath and reflect on the current recession.   Better yet, the purveyors of NPR's Planet Money podcast have set up a phone line where we can leave a recessional confession: 

Did you help break the global economy, or even the local one? Planet Money has a new call-in line for your confessions. It's (202) 371-1775.

If anything the call-in approach provides the platform for a great thought experiment.  Most of us observing the financial system cratering under its own gruesome weight feel (rightfully so) like hapless bystanders.  Digging deep enough reveals a thread to the current crisis in just about everyones' personal life.

The cynical Fausto is willing to admit his role.  I didn't run a hedge fund nor did I leverage a PhD in mathematics into developing synthetic CDO's or credit default swaps.  No, my story is a lot like yours.

I am guilty of turning my home into an ATM by way of a home equity line.  Sure we spent the majority of the credit on "capital improvements" but there was plenty of discretion on our part. A few niceties here and there quickly added up.  I'm not proud of my role in running up the U.S. trade deficit while helping to scuttle personal savings rates.  

I'm one of the more fortunate consumers traversing the real economy.  The equity line is almost paid off and the home value was spared the fate of other declining neighborhoods, keeping the underlying mortgage in the money so to speak.  All I can do is resolve to keep the personal debt to a minimum and maintain a glide path of more prudent savings, and all that.  There is it is, not very sexy.  That's how I contributed to the mess.