Twitter user @matthew2point0 got it right when he said “if I was trying to ruin my company’s finances, this is how I would do it.”
Sure, Affirm and Klarna (the two BNPL giants) have already started on this trend years ago, but Apple is one of the biggest companies in the world.
This move by the computing giant ushers in a new era of consumer debt that marks the decline of the American empire, as pointed out by billionaire, Ray Dalio.
So what is going to happen now?
Well, let’s look at the facts.
Here’s the average credit card debt by generation:
- Gen Z: $1,963
- Millenials: $4,322
- Gen X: $7,155
- Baby Boomers: $6043
- Silent Generation: $3,177
On the other hand, 61% of Americans are living paycheck to paycheck and have less than $1,000 in their checking account.
Let’s not even begin to talk about student loans…
It is pretty clear that major corporations are preparing for an American consumer that has no cash and no credit left to spend. So the next best thing? Credit for your credit…. that’s right…pay in 12 to 24 easy installments for the rest of your life.
At some point, this country will have to face reality and stop kicking the can down the road. But for now, that seems to be the direction that we are going as indicated by Tim Cook’s move to put Apple in the BNPL space.
When an economy only funnels money up to the top, sooner or later the citizens will run out of money to spend, and this is the exact impetus for Buy now pay later. – New Wall Street
What are some possible Remedies?
The FTC has called attention to Buy Now Pay Later as it cites compliance issues. However, they have failed to attempt a ban on the practice altogether.
Even if they did attempt to ban BNPL products, the lobbying power of Apple combined with Klarna and Affirm could easily sway any politician to shoot it down swiftly.
The question it seems is this:
Is there anything we can do to reverse course on the decline of the American quality of life?