Wednesday, 11 February 2009

To spend or not to spend?

It was quieter than usual when I went to Vivocity during lunch hour yesterday. Parking was a breeze and I didn't have to dodge any crowds when I walked within the mall. The only crowded stores were small boutiques offering huge discounts of up to 70%. Still, many office ladies just browsed without buying anything.

When CH was there for dinner with his friend, they were many empty seats at the foodcourt which is rather unusual. It used to be packed and you had to wait for seats. Even the $2 Daiso shop wasn't drawing in the crowds.

On one hand, everyone's trying to cut down on spending. Yet, on the other hand, we are supposed to spend to help the wheels of the economy turn. If people stop buying, the shops will start to close down. Factories will have to scale down their production. Banks lose confidence.

Apparently this recession is different from the past. It has been caused by a financial crisis. So, we need to start spending now to help lift the economy today. By spending, you'll help to keep people employed or create new jobs.

All this sound very sensible but what if the person is retrenched and worried about paying for the next meal? Or if he is standing on shaky grounds, he could be the next one to be axed. Would he rather spend or save?

I'm rather confused myself. I have already reduced spending since the financial crisis started. Yet on some days when I had spent too much, I feel awashed with guilt and scrutinise my purchase for the rest of the week. It's a tough one isn't it?


Nick Phillips said...

That's what I would call a catch 22 situation.

charlie hotel said...

We need a stimulus package...