Recession.  Mortgage crisis.  Subprime meltdown.  Credit crunch.  Falling dollar.  Stock market crash.  Inflation.

If you’ve turned on the TV or opened a newspaper this year, then you’ve been bombarded with these terms.  The media is all over these terms, and they’re playing it up as they are prone to do.  Granted, we do have some serious issues in the mortgage world, and the stock market has been off lately.  The dollar is most certainly in the toilet.  Banks are tightening the standards for credit ( to more reasonable levels ).  All of these scary things are happening right now, with the possible exception of a recession.  My question to you is this:

How do these things affect me?

Well, if you weren’t foolish enough to sign up for an exotic mortgage, you don’t need to be concerned with the housing / mortgage issues.  Folks with 15 or 30 year fixed rate mortgages aren’t concerned with things like ARM resets, payment options, or negative amortization.  Well how about the falling dollar?  Things that we get from overseas will begin to cost more, sure.  And since many of the things we buy are made overseas, this one is  concern. Not a huge one, but it’s there. 

Stock market woes?  I say it’s buying season.  Rather than fret over your paper losses, look at this as a buying opportunity - it’s a sale.  Instead of a computer or a pair of pants being on sale, companies are on sale.  Buy, buy, buy.  Do it smartly of course, and after much research.  But now is a great time to buy stocks.

Recession - the media is beating this word to death.  What’s a recession?  Two consecutive quarters of falling economic growth.  We don’t even have one.  Our economic growth slowed in the last quarter - which means it’s still growing, just not as quickly.  That does not equal a recession, and I think it’s irresponsible for the media to be putting false information into people’s heads.

The bottom line

The media exaggerates things - makes them out to be worse than they are.  Keep that in mind when you’re listening to the reports about how the sky is falling.  Also remember that you’re in control of your personal finances, and no one else.  Just because things cost a little more, and your investments are in the tank, doesn’t mean you have to jump off a bridge.  Tighten your belt and cut your spending - you will get through it.  If you haven’t had a chance, beef up your emergency fund so you have a fall back.  The main thing is, don’t freak out and overreact.  Everything will be okay after all - it has to be.

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