Money Can Burn Hole In Your Pocket

Hantu Laut

Today, I'll wind down on politics and look at some of society's negative human impulsions.

It's a sad story of trying to "keep up with the Joneses" and a compelling case of "easy come easy go"

Obviously, money can be your master or your servant and can "burns hole in your pocket" if one lacks prudence.

My good friend Apuh knows it, so he is saving his for the future generations. Future generations?? I told my children I want to enjoy mine, anything left behind, just consider yourself lucky, done my duty giving them good education.

It does not take long to finish millions if you don't have sustainable return and as the axiom " a fool and his money are soon parted" one can be penniless in no time. Mr Martin is one such person.

In Malaysia, living beyond the means are common among certain sector of the general population,particularly in credit card spending and buying cars they can ill afford.Malaysia's household debt rose to 67 % of GDP in 2009, partly due to the banking institutions changing policy of focusing on the household sector as part of their diversification strategy of not putting all eggs in one basket.

Prior to the 1997 Asian financial crisis lending to the corporate sector was much higher than household sector, taking almost 70 % of total lending.

Compared to the U.S which has household debt of over 95 % in 2009 and worse Britain, which household debt exceeded the GDP, ours is still manageable so long as the economy stays rosy.

Some of us have gone through hard times and came out unbroken, some did not, and suffer the consequence.

The foregoing is a sad story of prodigality.

Family’s Fall From Affluence Is Swift and Hard

The New York Times

WAMEGO, Kan. — Grateful to have found work in this tough economy, Nick Martin teaches grape growing and winemaking each Saturday to a class of seven students in a simple metal building here at a satellite campus of Highland Community College.

Then he drives 14 miles in an 11-year-old Ford Explorer to a sparsely furnished tract house that he rents for $900 a month on a dead-end street in McFarland, a smaller town. Just across the backyard is a shed that a neighbor uses to make cartridges for shooting the prairie dogs that infest the adjacent fields.

It is a far cry from the life that Mr. Martin and his family enjoyed until recently at their Adirondacks waterfront camp at Tupper Lake, N.Y. Their garage held three stylish cars, including a yellow Aston Martin; they owned three horses, one that cost $173,000; and Mr. Martin treated his wife, Kate, to a birthday weekend at the Waldorf-Astoria, with dinner at the “21” Club and a $7,000 mink coat.

That luxurious world was fueled by a check Mr. Martin received in 1998 for $14 million, his share of the $600 million sale of Martin Media, an outdoor advertising business begun by his father in California in the 1950s. After taxes, he kept about $10 million.

But as so often happens to those lucky enough to realize the American dream of sudden riches, the money slipped through the Martins’ fingers faster than they ever imagined.

They faced temptations to indulge, with the complexities and pressures of new wealth. And a pounding recession pummeled the value of their real estate and new financial investments, rendering their properties unaffordable.

The fortune evaporated in little more than a decade.

While many millions of Americans have suffered through this recession with only unemployment benefits to sustain them, Mr. Martin has reason to give thanks — he has landed a job at 59, however far away. He also had assets to sell to help tide his family over.

Still, Mr. Martin, a strapping man with a disarming bluntness, seemed dazed by it all. “We are basically broke,” he said.

Though he faulted the conventional wisdom of investing in stocks and real estate for some of his woes, along with poor financial advice, he accepted much of the blame himself.

“We spent too much,” he conceded. “I have a fourth grader, an eighth grader and a girl who just finished high school. I should have kept working and put the money in bonds.”

Mrs. Martin recalled the summer night in 1998 when the family was having a spaghetti dinner at home in Paso Robles, in central California, and a bank representative called to ask where to wire the money. “It seemed like an unbelievable amount,” she said regretfully.

Soon after the money arrived, the family decided to leave Paso Robles, amid some lingering tensions that Mr. Martin felt with his brother and brother-in law, who had run the business. Mr. Martin had never been in management at the billboard company, though he had been on the board and worked at Martin Brothers Winery, another family business.

First, the Martins bought a house in Somerset, England, near the home of Mrs. Martin’s parents, and he decided to write a novel. At about the same time, they spent $250,000 on the 3.5-acre camp with four structures on Tupper Lake, deep in the Adirondacks, as a summer home. They began extensive renovations at the lake, adding a stunning three-story boathouse and two other buildings.

Clouds gathered quickly. Life in England turned sour when Mr. Martin’s novel, “Anthony: Conniver’s Lament,” did not sell, and the family’s living costs — school fees, taxes and even advice for filing tax returns — swelled. In 2002, fed up with England, the Martins chose a new base, Vermont, and plunked down about $650,000 for a home there, as renovations continued on the Tupper Lake property.

By March 2007, the Martins were determined to move to the lake full time.Read more.