The easiest way to empty a room or kill a sale is to ask for a cash payment. It has always been so.
Always.
Not just this year, this decade or even this century. Pretty much forever.
While the Federal Reserve has lowered base interest rates by 0.25 percent, don’t believe the hyperventilators on TV declaring that it’s time to get into something better and, somehow, safer. The usual drumbeaters are calling for moves to (take your pick):
— commodities: gold, silver
— dollar alternatives: cryptocurrencies
— equity investment in the AI future that will solve everything
— equity investment in other countries.
The best way to get off the immediacy train is to watch Federal Reserve Chairman Jerome Powell explaining the decision and the uncertainties of the data that supports it. If you can muster the patience, stay tuned while Powell answers questions from the press trying to find further meaning in his statement.
The primary message is that the risk of a weakening economy and rising unemployment is now somewhat greater than the risk of renewed inflation. It’s an ever so fine distinction, not a call for drastic change. We may not get the interest income on our cash that we started to enjoy, but having cash is still far better than not having it. Skeptics should ask anyone in the top 10 percent of wealth: Recent figures show they now account for 49.9 percent of all consumer spending, up from about 35 percent in the 1990s.
That’s not the end of wealth concentration, either. One stock, Nvidia, now accounts for more than 7 percent of the S&P 500 market value and the “Magnificent 7” (Nvidia, Apple, Alphabet, Microsoft, Amazon and Meta) account for 30 percent.) Neither is a good sign.
Depending on how much further down the wealth and income scale you are, you’re likely feeling somewhere between treadmilling and sinking. Not good.
So, what can you do?
Here are a few suggestions. (Yes, I know some are painfully obvious, but consumer debt wouldn’t be rising if everyone knew the obvious.)
- Turn Your Use of Credit Cards into a Source of Cash. Take a small red pill, terminate your frequent flier credit cards and collect no annual fee cash rewards credit cards. You’ll save hundreds in fees and collect hundreds, possibly many hundreds, in cash. You’ll have taken the first step to end perpetual solicitation from marketers. (Read how the cash adds up here.)
- Get Off the Consumption Treadmill. Build what Arthur C. Brooks calls his “reverse bucket list” – wants he once had but no longer feels a need for, becoming more independent. This is a bigger red pill, but it’s what we need to counter the huge manipulation machine of consumer marketing.
- Focus on Short-Term Debt Reduction. If you’re debt burdened, focus on the shorter stuff – car loans and credit cards – because it will improve your “back-end ratio.” That’s the debt that makes it impossible for many to qualify for a home purchase. Read about credit cards here.
- Build a Cash Reserve. Easier said than done for most young people, but ready cash can buy bargains. How come? Most people don’t have any ready cash.
- Practice Buying Current Bargains. My wife and daughter have fun shopping together at thrift stores. They come away with some great clothing, among other things. They don’t have to. They enjoy it. Thrift retail is the fastest growing segment of retail.
- Be Ready for Future Bargains. No one knows exactly when or how it will happen, but there will be another day when everything everyone has ever wanted will be on sale. Cheap. (Read here about California in 2008.)
Related columns:
Scott Burns, “The Rewards of Being a Free Agent Customer,” 9/16/2023: https://scottburns.com/the-rewards-of-being-a-free-agent-customer/
Scott Burns, “How to Save in the No-Yield Economy,” 12/26/2010: https://scottburns.com/how-to-save-in-the-no-yield-economy/
Scott Burns, “Watching California: The National Yard Sale Begins,” 10/23/2008: https://scottburns.com/watching-california-the-national-yard-sale-begins/
Scott Burns, “The Coming National Yard Sale,”12/23/2007: https://scottburns.com/the-coming-national-yard-sale/
Scott Burns, “The Credit Wars: A Borrowed Dollar Is Not Your Friend, 7/27/1997: https://scottburns.com/the-credit-wars-a-borrowed-dollar-is-not-our-friend/
Sources and References:
Federal Reserve FOMC Press Conference, 9/17/2025: https://www.federalreserve.gov/live-broadcast.htm
Andrew Dorn, “Top 10% account for nearly half of all consumer spending: Report,” Yahoo!news, 9/16/25: https://www.yahoo.com/news/articles/top-10-account-nearly-half-232143434.html
Arthur C. Brooks on YouTube, “Use a Reverse Bucket List,” https://www.youtube.com/watch?v=vGBVf1wwAj0
This information is distributed for education purposes, and it is not to be construed as an offer, solicitation, recommendation, or endorsement of any particular security, product, or service.
Photo: Scott Burns, Recent photo taken on the trail around Lady Bird Lake in Austin.
(c) Scott Burns, 2025