Credit card: in economy perspective

The people always have three types of resources of interest: money currently being earned; money that has been earned in the past, and money that is likely to be earned in the future. Significant differences of these have disappeared in recent years. Money is money, which use as medium for buy goods or services. You pay for supermarket in cash, a new car in your long-term savings (past earnings which don’t use), and a home mortgage company will probably get at mostly future earnings via future principal and interest payments. The three entities above do not care what way of money comes from. Even past, present or future income. However, they induce people to spend present income. Past income, in the form of savings and investments.

But future incomes can expand the economic. It makes more liquidity or ability to sell if you accept the payment that not only cash but also future income, such as installment buying, some home loan, or especially credit. Credit card is some method that allows you to use expected future income for now-you don’t need any cash for going to supermarket. You may learn that using of credit card has some problem, if money that you expected doesn’t come, while you already use your future in come in credit card, you will be unable to pay their credit card bills in full. This problem has grown over the time. And people going to have burden of credit card debt that hard to eliminate.
The use of credit card is increasingly over the time. The main driver is e-commerce, like Amazon, or EBay that use credit card for purchasing. Some Cruise lines require lump sum payments that usually make payment by check.

However, this industry tends to accept more credit payment. For example, Princess Cruises lines earn much of money from the shops, the spa, and the casino, about 80% of these expense pay by credit card.

The economy growth is rapidly because of future expected income, people use future earnings in the present. But more rapidly tend to be more risky and more default rate-user of credit card is unable to pay their debt. Thus the method which helps people eliminating credit card debt is required. And people have to decrease use of credit card.
A decrease in such spending would affect the economy. Many banks have their credit card as their core business, so if use of credit card decline, they will bankrupt or restructuring and down-size to survive in business. Some retailers would disappear too because people don’t have ability to pay, and others would following fail. And the nightmare would come in form of depression or recession.

In the sums, I conclude that credit card is grease of economy. Use of credit card can boost up economy, but if people don’t carefully use it, credit card debt occur and unable to pay. Moreover economic could slow down.