I'm neither a baller nor a shot caller, but I'm starting to understand what rap mogul Sean "P. Diddy" Combs meant when he said, "It's all about the Benjamins."
Combs, you see, is irked by the soaring fuel bills for his private jet, and he's taken his frustration to the Internet in protest. In a YouTube video posted last week, the rapper bemoaned high oil prices as the culprit for what is surely a bellwether signal the economy is in shambles: being forced to accept the torture and humiliation of first-class commercial air travel.
"[R]ight now, can you believe it, I am actually flying commercial," he explained. "That's how high gas prices are, OK? So I feel you." Then came the solution, as Combs pleaded, "I want to give a shout out to all my Saudi Arabian brothers and sisters and all my brothers and sisters from all the countries that have oil, if you could all please send me some oil for my jet, I would truly appreciate it."
Thanks, Diddy. We'll let them know.
Maybe he didn't get the memo
Combs reminded us exactly why the economy isn't bubbling with prosperity: We're hell-bent on consuming beyond our means, and we'll do whatever it takes to keep that lifestyle up. Of course, private jets are outside the realm of comprehension for the average Jane and Joe, but swap out a rap tycoon who can't fly his jet for a salaried worker who can't afford to drive his SUV 100 miles to and from his sprawling house, and the issue is probably more prevalent than it looks.
No matter, armies of consumers, including P. Diddy, will hear of no alternative. The key to our economic strife is to continue whatever we've done over the last several years, the thought goes. Perhaps with a combination of hope and a dash of good fortune, importing gaggles of goods we can't afford will break the economic torment caused by, well, gaggles of goods we can't afford. Crazier theories have been taken seriously.
Come to think of it, yep, that is the problem
Take it as a term of endearment if you wish, but we're a nation of P. Diddys, unable to distinguish between the causes and consequences of our economic woes. He grumbles of not being able to afford something beyond his means and proposes a solution of begging for more foreign love without realizing it's been those actions that are partly to blame for our economic troubles of the last year.
Let's start with the first issue: the pursuit of things you can't afford. Housing provides a good example. Years of record-low interest rates made the question of whether you could actually afford a house a taboo subject. If you wanted to buy it, just push your frontal lobe out of the way and buy the darn thing. Someone would be able to finance your ambitions, even if its future prospects were downright silly. China provided the capital, Bank of America
Now on to the second issue: Relying on the kindness of foreigners to foot the tab of our overindulgence. Nations -- like people -- accumulate wealth on the ability of two things: saving money and investing it wisely. Both parts seem to be elusive for America. Savings rates have hovered at or around zero for years. Savings' distant cousin -- borrowing -- has taken the reins, but the funds from that spigot seem to end up as either fumes out of our tailpipes, whoopee cushions, or distant memories on foreclosed homes. The end result: The more we rely on borrowed money for things we can't afford, the weaker the dollar gets. In 2000, the dollar was strong, and oil was cheap. Today, the dollar is weak, and oil is expensive. That isn't a coincidence, nor is it something that will right itself without significant changes.
All of this comes back to Diddy's plea for more imports: Importing more goods for things you admittedly can't afford won't solve your problems ... those are the causes of your problems.
For related Foolishness:
Fool contributor Morgan Housel doesn't own shares any of the companies mentioned in this article. Bank of America is a Motley Fool Income Investor pick. Home Depot and Best Buy are Motley Fool Inside Value selections. Best Buy is a Motley Fool Stock Advisor pick. The Fool owns shares of Best Buy and has a disclosure policy.