There’s a meme out there that only rich people will be able to afford Playstation 3′s. That’s bulls**t.
Let me tell you how it works in the US of A. You walk into Best Buy. Ask for a credit application. Fill it out. They approve you for $10,000 on the spot (as long as you’ve paid all your credit card bills on time). You head over to the big screen department, pick out your $4,000 big screen and your $600 Playstation 3, and a $500 HD-DVD drive. Then you pay something like $140 per month in payments.
Can’t afford that much? Then get a screen that costs about $1,500 instead.
Now, how much is that? Well, a movie, hotdog, and Coke, for four people will cost you about $60. So, for two movies with your family you can afford a kick ass bigscreen and gaming system.
There is WAY too much being made about the price of these things.
Rob: I’m just passing along what I observe. One of my brother-in-laws drives a bus in Wales. Another lives in Milpitas, which isn’t a high end neighborhood. I see tons of big screens in both. If noting that makes me an insensitive boob, OK.
ok, so only rich and upper middle class people can afford a ps3
seriously, for MOST people $140 is a lot! i always thought you were liberal!
ok, so only rich and upper middle class people can afford a ps3
seriously, for MOST people $140 is a lot! i always thought you were liberal!
Rob: I’m just passing along what I observe. One of my brother-in-laws drives a bus in Wales. Another lives in Milpitas, which isn’t a high end neighborhood. I see tons of big screens in both. If noting that makes me an insensitive boob, OK.
Jonas: $140 a month gets you into upper middle class? Damn, where do you get your economics?
In UK we are constantly being warned by the Government about the ‘evils’ of consumer credit, but that doesn’t stop us from being billions £ in debt as a nation.
But is the PS3 predicted to being the big hit this Christmas? No, a robot is, oh and the Xbox 360.
In UK we are constantly being warned by the Government about the ‘evils’ of consumer credit, but that doesn’t stop us from being billions £ in debt as a nation.
But is the PS3 predicted to being the big hit this Christmas? No, a robot is, oh and the Xbox 360.
Jonas: $140 a month gets you into upper middle class? Damn, where do you get your economics?
Chris: >>After all, it’s not like you’re ever going to need money in the future for things like, oh, his college tuition.
Already taken care of, thank you very much.
Did I ever say to spend more than you can afford? Go back and read what I wrote. Didn’t say anything of the sort.
Most people don’t have $5,000 sitting around, so using credit to buy a nice entertainment system is totally reasonable. At least in my world.
Chris: >>After all, it’s not like you’re ever going to need money in the future for things like, oh, his college tuition.
Already taken care of, thank you very much.
Did I ever say to spend more than you can afford? Go back and read what I wrote. Didn’t say anything of the sort.
Most people don’t have $5,000 sitting around, so using credit to buy a nice entertainment system is totally reasonable. At least in my world.
i’m not talking about +140 = upper middle class. most middle class people will probably be Able to save that each month. however, it would probably be more than easy to rearange your economy. saying “dont to to the movies” is a bit oversimplifying.
i’m not talking about +140 = upper middle class. most middle class people will probably be Able to save that each month. however, it would probably be more than easy to rearange your economy. saying “dont to to the movies” is a bit oversimplifying.
-t +g
-t +g
A typical ‘live now’ post. For a vast number of people who operate good financial management taking on a large debt like this is a no no.
At the end of the day you have to manager your own finances and if you can afford to add $140 a month to your existing financial burdon for the ability to add better definition tv and a game platform then go for it.
But to advocate to people that a $600 gameing system is for everybody, you only need to put youselves into debt, is irresponsible and not up to your usual level of commentary.
A typical ‘live now’ post. For a vast number of people who operate good financial management taking on a large debt like this is a no no.
At the end of the day you have to manager your own finances and if you can afford to add $140 a month to your existing financial burdon for the ability to add better definition tv and a game platform then go for it.
But to advocate to people that a $600 gameing system is for everybody, you only need to put youselves into debt, is irresponsible and not up to your usual level of commentary.
So am I Robert.
The average American pre-tax wage is around $32k. I’m not going to write out the math, but as a parent yourself I’m sure you can see the hardship in trying to support a family on that sort of annual income (even allowing for a second parent with a full or part-time job).
I would imagine the last thing a family in that situation would want is to blow $600 on a video game system, or even $150 per month on credit repayments.
Anyhow, I enjoy your blog but you really need a dose of reality on this one. $600 is a hell of a lot of money, to a hell of a lot of people.
A.
PS – R.e movie prices; I didn’t realise you meant coke and snacks for everyone! I always share with whoever I’m with, I’ve no idea how anyone manages to finish one of those gigantic cups by themselves!
So am I Robert.
The average American pre-tax wage is around $32k. I’m not going to write out the math, but as a parent yourself I’m sure you can see the hardship in trying to support a family on that sort of annual income (even allowing for a second parent with a full or part-time job).
I would imagine the last thing a family in that situation would want is to blow $600 on a video game system, or even $150 per month on credit repayments.
Anyhow, I enjoy your blog but you really need a dose of reality on this one. $600 is a hell of a lot of money, to a hell of a lot of people.
A.
PS – R.e movie prices; I didn’t realise you meant coke and snacks for everyone! I always share with whoever I’m with, I’ve no idea how anyone manages to finish one of those gigantic cups by themselves!
Robert,
I really can’t believe what you’ve just written. You’ve just dispensed some of the silliest financial that I’ve ever read on a blog.
First of all, the median salary for an American family (you know the people in the suburbs as you say) is ~42,500 a year. That’s for a family of 3. The median price for a home in the suburbs is ~250,000 a year. In addition to a mortgage, you have a plethora of other costs that you have to take into account. Car payments, homeowners insurance, child care, health insurance, car insurance, and the list goes on and on.
For most people, saddling themselves with $5,100 dollars (assuming you get the big TV) is sheer fiscal irresponsibility and it’s not reality (even the small TV is nonsense).
The simple fact that this is being talked about means that some people can’t afford it.
People DO care about the interest and the payments. To nonchalantly wave that off shows that a real disconnect between you and the average American out there.
Please step down from your ivory tower and apologize to every “have-not” that has just read your post. You’ve just made them feel worthless.
Robert,
I really can’t believe what you’ve just written. You’ve just dispensed some of the silliest financial that I’ve ever read on a blog.
First of all, the median salary for an American family (you know the people in the suburbs as you say) is ~42,500 a year. That’s for a family of 3. The median price for a home in the suburbs is ~250,000 a year. In addition to a mortgage, you have a plethora of other costs that you have to take into account. Car payments, homeowners insurance, child care, health insurance, car insurance, and the list goes on and on.
For most people, saddling themselves with $5,100 dollars (assuming you get the big TV) is sheer fiscal irresponsibility and it’s not reality (even the small TV is nonsense).
The simple fact that this is being talked about means that some people can’t afford it.
People DO care about the interest and the payments. To nonchalantly wave that off shows that a real disconnect between you and the average American out there.
Please step down from your ivory tower and apologize to every “have-not” that has just read your post. You’ve just made them feel worthless.
Spending $5,000 on a home entertainment center is one thing. Spendng $8,000 on a $5,000 home entertainment center is another thing entirely, and that’s if you’re making all your payments on time. Spending money you don’t have on things you don’t need just sounds like asking for trouble to me.
Spending $5,000 on a home entertainment center is one thing. Spendng $8,000 on a $5,000 home entertainment center is another thing entirely, and that’s if you’re making all your payments on time. Spending money you don’t have on things you don’t need just sounds like asking for trouble to me.
Sorry Robert, I can;t agree with this. All my life I;ve lived by a simple bit of budgeting advice from my father. If it’s not in your pocket, don’t spend it. Okay I need to expand that now as a parent to if it’s not in your pocket at the end of the month, don;pt spend it. You might want to have a look at the dange overstretching credit can do – and when the economy slows down (which it will, the US defecit is bigger than, oh, some African countires), it’s going to hurt. If an avergae wage couple can spare $150, they’d be best overpaying the mortgage or investing, than buying a games machine and screen.
Sorry Robert, I can;t agree with this. All my life I;ve lived by a simple bit of budgeting advice from my father. If it’s not in your pocket, don’t spend it. Okay I need to expand that now as a parent to if it’s not in your pocket at the end of the month, don;pt spend it. You might want to have a look at the dange overstretching credit can do – and when the economy slows down (which it will, the US defecit is bigger than, oh, some African countires), it’s going to hurt. If an avergae wage couple can spare $150, they’d be best overpaying the mortgage or investing, than buying a games machine and screen.
“I’m just passing along what I observe” isn’t really a worthwhile measure of poverty, as what you don’t observe is probably more important. This article (http://observer.guardian.co.uk/world/story/0,,1712965,00.html) from The Observer points out that one in ten Americans are now living in poverty, and that even those working two or three jobs can’t make ends meet.
To say that such people can just pay another $140 per month shows incredible naivety.
“I’m just passing along what I observe” isn’t really a worthwhile measure of poverty, as what you don’t observe is probably more important. This article (http://observer.guardian.co.uk/world/story/0,,1712965,00.html) from The Observer points out that one in ten Americans are now living in poverty, and that even those working two or three jobs can’t make ends meet.
To say that such people can just pay another $140 per month shows incredible naivety.
Encouraging people to live beyond their means is stupid and irresponsible. Getting credit because you can’t afford a big TV and home entertainment system is living beyond your means and will leave you worse off in the long run.
If you can’t afford something, you save up for it. You save money and don’t end up in debt.
The only thing worth taking out a loan for is a house, in my opinion. New car? New entertainment system? Save up for it.
Encouraging people to live beyond their means is stupid and irresponsible. Getting credit because you can’t afford a big TV and home entertainment system is living beyond your means and will leave you worse off in the long run.
If you can’t afford something, you save up for it. You save money and don’t end up in debt.
The only thing worth taking out a loan for is a house, in my opinion. New car? New entertainment system? Save up for it.
Hmmm,
Sorry but this whole article is Bulls**t. If you have to get credit to buy a ‘luxury item’ – which let’s face it, a games console is – then you can’t afford it.
The movie/hotdog analogy is crap, because at least if you can’t afford to go to the movies one month you don’t have to.
Such an irresponsible attitude to money is the reason so many people are up shit creek these days.
Coming from you, Robert, I expected more…
You’re right on one thing though; Not just rich people buy PS3s and XBOXs, stupid/irresponsible poor people do too.
Hmmm,
Sorry but this whole article is Bulls**t. If you have to get credit to buy a ‘luxury item’ – which let’s face it, a games console is – then you can’t afford it.
The movie/hotdog analogy is crap, because at least if you can’t afford to go to the movies one month you don’t have to.
Such an irresponsible attitude to money is the reason so many people are up shit creek these days.
Coming from you, Robert, I expected more…
You’re right on one thing though; Not just rich people buy PS3s and XBOXs, stupid/irresponsible poor people do too.
Robert,
I have no idea what your idea of poor is. But having served breakfast at inner city missions before I see people that barely have $10 left over at the end of the month, much less $140. Most people I see who have fallen on hard times are more concerned about little things like food for their kids and having enough warm clothes to get through winter. A big screen TV and a playstation isn’t even on their radar.
You need to need to live your little bubble of beach-side suburbs every once in awhile and actually get in touch with what is going on in this country. There is a lot more to life than tech toys.
Robert,
I have no idea what your idea of poor is. But having served breakfast at inner city missions before I see people that barely have $10 left over at the end of the month, much less $140. Most people I see who have fallen on hard times are more concerned about little things like food for their kids and having enough warm clothes to get through winter. A big screen TV and a playstation isn’t even on their radar.
You need to need to live your little bubble of beach-side suburbs every once in awhile and actually get in touch with what is going on in this country. There is a lot more to life than tech toys.
So what happened to the Robert who earned less than 100K at Microsoft.
Now he is living up the Podtech Web 2.0 bubble dollars
So what happened to the Robert who earned less than 100K at Microsoft.
Now he is living up the Podtech Web 2.0 bubble dollars
Robert, it’s been a *long* time since you’ve been anything close to really poor, if ever. I can tell you that growing up, the only TV we had was given to us by a friend who had gotten a new one.
Why?
Well, we were more concerned with mundane things like…”rent” and …”food” and…”clothing”. Yeah, you REALLY need to get out more. On second thought…clueless white guy…um..no, don’t go into the really poor areas of this country. The tolerance for your ignorance there would not be high, and I’d hate to see you stupid yourself into getting shot.
Robert, it’s been a *long* time since you’ve been anything close to really poor, if ever. I can tell you that growing up, the only TV we had was given to us by a friend who had gotten a new one.
Why?
Well, we were more concerned with mundane things like…”rent” and …”food” and…”clothing”. Yeah, you REALLY need to get out more. On second thought…clueless white guy…um..no, don’t go into the really poor areas of this country. The tolerance for your ignorance there would not be high, and I’d hate to see you stupid yourself into getting shot.
I have to agree with the person who asked who gets a Best Buy credit card? I wouldn’t touch one of those with a ten foot pole. Not to mention, there’s something about financing a gaming console that leaves a bad taste in my mouth. That’s the sort of thing you should really save up for if you don’t have the money to spend on it.
Your post seems extremely financially irresponsible especially in today’s economic climate. I agree that rich people aren’t the only ones who will buy a PS3, but your post appears to be encouraging them to spend thousands and thousands on something that’s entertainment related.
The difference between your movies and financing that type of debt is that if you run into financial problems, you can stop going to the movies and stop spending $60….you can’t do that with a $5,000 balance on your credit card (unless you file for bankruptcy).
I have to agree with the person who asked who gets a Best Buy credit card? I wouldn’t touch one of those with a ten foot pole. Not to mention, there’s something about financing a gaming console that leaves a bad taste in my mouth. That’s the sort of thing you should really save up for if you don’t have the money to spend on it.
Your post seems extremely financially irresponsible especially in today’s economic climate. I agree that rich people aren’t the only ones who will buy a PS3, but your post appears to be encouraging them to spend thousands and thousands on something that’s entertainment related.
The difference between your movies and financing that type of debt is that if you run into financial problems, you can stop going to the movies and stop spending $60….you can’t do that with a $5,000 balance on your credit card (unless you file for bankruptcy).
ref. 35
All good points. I’ll use your figures if you don’t mind.
$42,500 income Family of 3
$250,000 home
$50,000 CARs
$40,000 education for child
$40,000 education for Dad
$40,000 education for Mom
$5,000 credit cards ???
entertainment priceless!
Housing bust analysis (enter Rocket scientist). LOL
Get real $$$$ or go out of business (FORD etc.)
I owe my soul to the company store.lol
A few more figures.
Interest rates as high as 30%?? Only impacts the poor.
The American dream (Advertised daily).
Divorce rate = 50% (your chances don’t look good)
Children all screwed up for the future.
No problem, Buy that XBox-360.
Isn’t math fun when based in reality.
Please pass the excargot and Chardonnay.
ref. 35
All good points. I’ll use your figures if you don’t mind.
$42,500 income Family of 3
$250,000 home
$50,000 CARs
$40,000 education for child
$40,000 education for Dad
$40,000 education for Mom
$5,000 credit cards ???
entertainment priceless!
Housing bust analysis (enter Rocket scientist). LOL
Get real $$$$ or go out of business (FORD etc.)
I owe my soul to the company store.lol
A few more figures.
Interest rates as high as 30%?? Only impacts the poor.
The American dream (Advertised daily).
Divorce rate = 50% (your chances don’t look good)
Children all screwed up for the future.
No problem, Buy that XBox-360.
Isn’t math fun when based in reality.
Please pass the excargot and Chardonnay.
Invest 5000$ at 10% for 5 years = 8,052.55+
Spend 5000$ at 19% for 5 years = 6,376.06-
Total difference in income for saver vs. spender = 14,428.61
(10% return on investment is difficult to do with only 5k, and doesn’t factor in risks. Credit assumes 7% of balance minimum payments.)
Buying on credit is crazy. I mean, buying 2k-5k worth of stuff that you don’t need at 19% is nuts. Suggesting to people that this is reasonable is offensive. If you can afford to buy on credit like that, you can afford to buy the thing outright.
Look, I’m related to a bunch of old rich people. White, upper middle class, florida-retirin’, golf-cart drivin’, cadillac ownin’, self-made millionaire old people. You know how they got rich and stayed that way? They never bought a damn thing they couldn’t pay for outright. Yeah, when they were young, right after the war, they had to split ownership of their car with the father-in-law. But they didn’t buy on credit. Now they don’t pay interest – on anything. Ever.
Have you walked around a so-called “poor” neighborhood lately? I see big screens in almost every home.
So. What.
How far in debt are the people who live in those homes? How many crappy jobs do they have to work for the privelege of keeping those screens lit by paying the minimum interest charges? Can you see that when you walk through these neighborhoods?
Get your ethics calibrated.
Invest 5000$ at 10% for 5 years = 8,052.55+
Spend 5000$ at 19% for 5 years = 6,376.06-
Total difference in income for saver vs. spender = 14,428.61
(10% return on investment is difficult to do with only 5k, and doesn’t factor in risks. Credit assumes 7% of balance minimum payments.)
Buying on credit is crazy. I mean, buying 2k-5k worth of stuff that you don’t need at 19% is nuts. Suggesting to people that this is reasonable is offensive. If you can afford to buy on credit like that, you can afford to buy the thing outright.
Look, I’m related to a bunch of old rich people. White, upper middle class, florida-retirin’, golf-cart drivin’, cadillac ownin’, self-made millionaire old people. You know how they got rich and stayed that way? They never bought a damn thing they couldn’t pay for outright. Yeah, when they were young, right after the war, they had to split ownership of their car with the father-in-law. But they didn’t buy on credit. Now they don’t pay interest – on anything. Ever.
Have you walked around a so-called “poor” neighborhood lately? I see big screens in almost every home.
So. What.
How far in debt are the people who live in those homes? How many crappy jobs do they have to work for the privelege of keeping those screens lit by paying the minimum interest charges? Can you see that when you walk through these neighborhoods?
Get your ethics calibrated.
[...] Not just rich people buy Playstations and Xbox’s This is just ridiculous. It sickens me to see people advocating the use of credit to buy these types of things. If you need credit to buy a HDTV and gaming system, then you don’t need a HDTV and gaming system. Use cash or save for it. Period. [...]
This interactive tool:
http://www.globalrichlist.com/
Might help put things in perspective. I think enough people have pointed out how distorted your view is here. It reminds me of people who are genuinely surprised to discover that not everyone has 2 PCs and high-speed broadband.
This interactive tool:
http://www.globalrichlist.com/
Might help put things in perspective. I think enough people have pointed out how distorted your view is here. It reminds me of people who are genuinely surprised to discover that not everyone has 2 PCs and high-speed broadband.
“Have you walked around a so-called “poor” neighborhood lately? I see big screens in almost every home.”
Actually no Robert, I haven’t walked around any poor neighborhoods in a large city. Nor could you convince me that you have either – making absurd statements like that.
In my rustbelt town of 125,000 most families of 4 are on budgets. Most families of 4 do head out together to movies – but they wait until things hit the second-run theaters that charge $2 admission.
Do you want to know why some people get concerned about another bubble burst coming? It because out-of-touch people making uninformed statements like the one you made above.
Two more related quotes of yours Robert:
“But I’m talking about people in the average American suburb like Milpitas, Jersey City, Orlando, Chicago, etc.”
“One of my brother-in-laws drives a bus in Wales. Another lives in Milpitas, which isn’t a high end neighborhood. I see tons of big screens in both.”
Just a wee bit inconsistant, eh? You first use the word poor – once again making a point by going over the top – and when people call you on it you backtrack. Damn.
“Sorry but this whole article is Bulls**t.”
Robert words in the comment section make his article smell like a rose in comparison.
“Have you walked around a so-called “poor” neighborhood lately? I see big screens in almost every home.”
Actually no Robert, I haven’t walked around any poor neighborhoods in a large city. Nor could you convince me that you have either – making absurd statements like that.
In my rustbelt town of 125,000 most families of 4 are on budgets. Most families of 4 do head out together to movies – but they wait until things hit the second-run theaters that charge $2 admission.
Do you want to know why some people get concerned about another bubble burst coming? It because out-of-touch people making uninformed statements like the one you made above.
Two more related quotes of yours Robert:
“But I’m talking about people in the average American suburb like Milpitas, Jersey City, Orlando, Chicago, etc.”
“One of my brother-in-laws drives a bus in Wales. Another lives in Milpitas, which isn’t a high end neighborhood. I see tons of big screens in both.”
Just a wee bit inconsistant, eh? You first use the word poor – once again making a point by going over the top – and when people call you on it you backtrack. Damn.
“Sorry but this whole article is Bulls**t.”
Robert words in the comment section make his article smell like a rose in comparison.
Wow, I can’t believe you just seriously suggested that people go into debt for a game console… I think you missed your calling as a financial adviser.
On the topic at hand though, it’s not about being able to afford it, it’s perceived value for your money that matters. For really hardcore gamers, $800 (console+game+HDMI cable) might be worth it. For the less than hardcore gamer though? I doubt it.
Every console in history that’s been released into this price range (and there have been quite a few, inflation adjusted) failed dismally in the market. I expect the PS3 to do better than the 3DO, Jaguar, Neo Geo, and Sega Saturn. But it won’t be nearly the success that the PS2 was, and that’s what really matters. If Sony falls to second or third place this generation, they’re sunk.
Wow, I can’t believe you just seriously suggested that people go into debt for a game console… I think you missed your calling as a financial adviser.
On the topic at hand though, it’s not about being able to afford it, it’s perceived value for your money that matters. For really hardcore gamers, $800 (console+game+HDMI cable) might be worth it. For the less than hardcore gamer though? I doubt it.
Every console in history that’s been released into this price range (and there have been quite a few, inflation adjusted) failed dismally in the market. I expect the PS3 to do better than the 3DO, Jaguar, Neo Geo, and Sega Saturn. But it won’t be nearly the success that the PS2 was, and that’s what really matters. If Sony falls to second or third place this generation, they’re sunk.
So far I haven’t seen a single comment that supports the original post (except from Scoble). And I’m not going to be the one to break that, but it’s gotta show how far off the mark your reader’s think you are on this one. Time for a more detailed post?