Most of the people in the United States and Japan nowadays count almost exclusively on their credit cards in order to maintain the lifestyle they are used to. There are literally millions around the world who plan their monthly spending or budgets in general along the line of credit their banks give them. That may be as it is, but it turned into an absurd situation for most of them. Before there was such a thing as credit cards people lived from paycheck to paycheck. So by the end of the month they had spent all the money they had earned, waiting for the next payslip. But they had spent THEIR money.

Nowadays people still live from paycheck to paycheck, but now they need all the salary or wage they get to pay off their credit card. So at the beginning of the month they are already broke and have to do the rest of the month's spending on credit cards, which in turn they have to pay off at the beginning of the next month. It's a vicious cycle and a multi - billion dollar business for the banks. People will always spend more than what they have or will be able to pay off the following month and therefore have to pay obscenely high interest on their cards.

Another negative side effect is that people have such a high credit debt that they are unable to save some money for a new car, for example, or a new house. They are condemned for practically the rest of their lives to go through this repeated cycle.

Now, there are countries, like Germany, for example, where credit cards are highly unpopular. The Germans use them, yes, but very expeditiously. Germany and others of her European neighbors have a very developed financial culture where spending money which you don't have is frowned upon. It's the diaspora for American Express, Master Card and others. That•?s why they love to do business in the United States, because there it's socially accepted that you spend money first and than work for it.

The Germans, to stick with this example, are famous for their internal savings. The country as a whole might be indebted, like any other nation on this earth. But Germany's debt is always set off by the private savings of its people. Every household has on average about $1,000 in a savings account which is never spend. It's for the famous emergencies, few of which actually happen. But add up a thousand dollars for each household and you'll find that the countries balance sheet is in the blacks.

Back to the States. Most young people are told to establish, early on, their credit line and it does look to them like free money. Until, that is, they start to realize that they have to pay off at some point or other these ridiculously high credits, or else. So a lot of people resort to the old trick of paying off one credit card with another, spending their lives juggling about their different credit cards. They end up with multiple banks they owe to instead of one.