What would you do if your credit card balance was this big?

, , , , , , , , , ,

Sometimes it’s difficult to get a feel for economics and the concepts and amounts involved.

A friend sent me an email that’s doing the rounds on the internet and it emphasises rather nicely the issues behind the financial problems that the US currently faces.

It moves away from “grown up economic terms” to instead use an example about the US financial problems which people will find easy to understand.

They may also however find it a bit shocking.

The US financial position can be succinctly stated as:

1.    US Tax revenue: $2,170,000,000,000
2.    Fed budget: $3,820,000,000,000
3.    New debt: $1,650,000,000,000
4.    National debt: $14,271,000,000,000
5.    Recent budget cuts: $38,500,000,000

Now, if you simply remove 8 zeros and imagine it is a household budget you’ll get the following:

1.    Annual family income: $21,700
2.    Money the family spent: $38,200
3.    New debt on credit card: $16,500
4.    Outstanding balance on the credit card: $142,710
5.    Total budget cuts: $385

There. It’s easy. Who said economics was difficult?

Now, how do we go about extending the credit card limit again?

Would you steal £30m from ING Bank?

How much would you try to steal from your employer if you work for ING bank and you’re an accountant? Hopefully most of you would[..]

Would you criticise me if I spent ALL of YOUR bonus on alcohol?

One of the ways that governments around the world have tried to kick start the economy during the recent recession has been through the reduction[..]

What has the end of the world got to do with business strategy?

Mr Harold Camping, an 89 year old evangelist from America predicts that tomorrow Jesus Christ will return to earth and true followers will be swept[..]
Rolling in it...
Here’s a question for you – what do you think the average age is of somebody who buys a new Rolls-Royce? Perhaps surprisingly the average[..]
An unexpected ending...
A lot of you may have been on business trips but I bet your trip wasn't as exciting (and tragic) as this gentlemen's trip was.[..]
Would you send a photo?
Picture the scene. You’re one of the largest supermarket chains in the Netherlands employing more than 100,000 people. You’re planning on introducing a new staff[..]
Ericsson fined $1 billion for bribery.
The Swedish telecommunications group Telefonaktiebolaget LM Ericsson (or Ericsson as most people refer to it as and how my spell checker prefers) is an incredibly[..]
Exams for sale....
One of the five fundamental ethical principles is Integrity. Being straightforward and honest is a vital characteristic of being a professional accountant. Most people who[..]
Wave hello to a discount
The accountants amongst you will be well aware of the different methods of setting the price of a product or service. Going rate, cost-plus and[..]