A week ago on Sunday the family and I took my folks - who are visiting from out of town - to lunch in Palo Alto. The restaurant we went to was close to an Apple store, where a line of about 100 people snaked out the door and around the corner. Californians in their multitude stood around for hours in line to get themselves a brand new iPhone. On Monday, I witnessed the same phenomenon at the Stanford Shopping Mall, where another Apple store is located. It occurs to me that the line for the iPhone symbolizes much that is bad about U.S. consumers and the reason for why our economy is in such dire straights these days.
To be pointed about it, the American consumer is akin to a five year old who is unable to delay gratification for even a few days. They want their toys, and they want them now. Tomorrow will simply not do and next year is completely out of the question. How is this a problem, you ask? It's not that I have any problems with the iPhone- in fact, when the lines disappear I will probably get one myself - it's just that the willingness of people to stand for hours in line just to get the latest toy - be it an iPhone, a Wii console, a Harry Potter book or a ticket to the newest blockbuster - is simply irrational. Guys, those toys are not in short supply. Go to your nearest book store and ask for a Harry Potter and you'll no doubt get one. Wait for a few weeks and the same will be true for the iPhone. Why the rush?
This is probably not a major issue when you are talking about relatively low cost items, but the same phenomenon is what got us into our current economic malaise. I can't afford to buy a house - never mind, I'll take a crazy loan that I can't repay and get one anyway. I can't delay my satisfaction. I can't afford to take a Caribbean vacation. Never mind, I'll just put it on my credit card and pay it off twice over with interest. I can't save for retirement because I have a burning desire to buy a new pair of shoes, car, big screen TV, whatever. My immediate wants far outweigh my future needs.
Many Americans have apparently lost their capacity for rational thought and delayed gratification in the face of consumer culture. So, get it all now if you must, but remember that the time will come when the Piper will demand payment in full.
On an unrelated note, check out the latest Carnival of Personal Finance where my recent post about the benefit of the long bear market is also included.
5 comments:
Right on. That's where the term "sheeple" came from. It's appalling.
Ugh, I'm feeling that tug for an iphone...so many of my friends have them or are getting them, and seeing all the neat features and sleek design is making me jealous. I'd LOVE to have one. But do I really need to pay a hefty early termination fee to get out of my current contract, spend several hundred on a new phone, and an additional extra $40 or so a month on cell phone service? Absolutely not -- I can't afford that right now, and I bet many of the people doing it can't either. But Americans, like you said, have no patience and are die-hard consumers. It's hard to resist a trend as powerful and cool as the iphone, but I'm going to resist as long as I can.
See, Emily, my point is: even if you decide you want an iPod and even if you really shouldn't get one from a financial perspective, MUST you get one right away? Must you stand in line for hours on end to get your hands on one? Can't you wait a month or two for the lines to die down?
What bugs me is this obvious need for immediate gratification. As I said - I see this frequently with my 6 and 3 year olds...
1. instant gratification is the result of being the "me" generation, who are spoiled by parents w/ financial stability, and which I'm a part of
2. if you don't get something you want right away, you often forget about it. if the knawing hunger is still there after a few weeks, then get it. it's amazing how you'll forget all about most things - this works for eating less junk food, too!
That's good advice.
Unfortunately, I can't preach against junk food - it is my kryptonite.
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