The financial crisis for dummies: how marketing killed us!

Many papers and reports have been written in the last 4 years about the financial crisis. Almost everyone has his own opinion. Nevertheless, as always, experts are trying to find complex reasons and solutions to explain how the financial system bankrupted and how it has to be fixed. My opinion is that the financial crisis is the consequence of one main reason: a never-ending story of over-consumption for 30 years. This phenomenon of over-consumption has been promoted by 3 main channels:

1.  Advertising everywhere at any time: Web, TV, Radio, Newspapers, Streets, Roads, Airports, Stations, even Schools…
2. A highly materialistic way-of-life promoted by famous (and not so famous) people: sport and movie stars, politicians.
3. A sensation of easy and fast glory promoted through stupid TV programs: Big Brother, American Idol...

When I was a child, every boy wanted to be a policeman, a firefighter or something similar. Nowadays, as a little boy said in the press recently, kids want to be football players because they are rich and f..k a lot of models!

In developed countries, until the 70’s, we were living in a world in which citizens existed by themselves: “I think I am”. From the 80’s, the hyper and fast development of what we can name marketing, started promoting a world in which you are what you consume: “I (over) buy I am”. This is definitely the point of inflexion. In the 21^st century, people in developed countries can still easily afford their basic needs but could hardly afford their superficial ones. Who really need a new iPhone every 6 months to be happy? That is when greedy bankers arrive and find “new” ways to finance over-consumption and over-spending with risky products that first looked safe. The same phenomenon occurs among politicians who are keen to find new ways to finance their public overspending in order to get votes.

After years of over-consumption and over-spending, the system finally bankrupted and is still almost bankrupt. On the long-run, you can definitely not spend more than you earn.

In conclusion, the most effective solution to the crisis would be a total change of mind of the developed world in which people stop being consumers to become citizens. As always, culture is a key variable to explain problems and fix them.

But on the other side of the world, developing countries like China, India or Brazil are so influenced by the western culture that they are also engaging in this never ending story of over-consumption. China has probably created the largest real estate bubble of the history of mankind. Be prepared for the burst…