Last week I spoke with a contractor who had worked on a project for me back in 2010. He does very good work so I asked him back to look at a small carpentry job I need help with. He’s busy these days juggling several other much larger more lucrative projects. I have no expectation that he will be available anytime soon, but I was putting myself in the queue for future reference. As we spoke we made the usual small talk. He mentioned in passing that he had just taken out an $85K home equity loan so he could remodel his own kitchen.
I got a flashback to 2010 – just six years ago. Back then the financial crash of 2008 was still wreaking havoc in the economy. This particular carpenter was struggling to keep up with mortgage payments, truck and car loans, credit card debt, and a general loss of income in a labor market where the building trades had come to a near standstill. During his stint with my project – a job he would never have taken on in better times – he asked for money up front and continually requested more funds each week even though he wasn’t keeping up with the pace he had originally promised. He had bills to pay and he really needed the money. He was taking on a lot of small low profit projects just to keep cash flowing, but he would have to start new ones before the old ones were completed. We played a little game of tug-of-war where I waited until he did more work before I’d advance him more money.
So last week I was amazed as he described all the great things he was doing to his house with the borrowed money. I noticed he pulled up in a new truck that was even bigger and shinier than his old one. Times are flush again and he’s enjoying the buffet exactly like he did in the boom years that preceded the 2008 crash. I told him we’re in another bubble and this was not a good time to be taking on debt. Bubbles tend to pop. His house is already beautiful. There isn’t a damned thing wrong with his kitchen. And he could have gotten a few more years out of his old truck. He’s north of sixty. Does he really want to be paying off a second mortgage until he’s eighty?
He gave me a look – a look I know very well. “Dude. Why are you such a wet blanket? Lighten the fuck up.”
People have the same memory capacity as goldfish.