I&#x27;ve heard it said (and I don&#x27;t know how true it is) that during the Reagan (I think) administrations, they &quot;convinced more than half of the people that they were in the top 50%&quot;, meaning that people began to think of themselves as more well-off than they actually were, and started spending more than saving.<p>I have no idea if that&#x27;s accurate, but it&#x27;s an interesting thought.  For the economy overall, it&#x27;s probably best if everyone buries themselves as far into debt as they can, because it increases spending tremendously.  Max out credit cards, buy as much &quot;stuff&quot; as possible (cars, real estate, college degrees, whatever).<p>The problem is that when the first real bump in the road comes along, suddenly most people are leveraged to the hilt and can&#x27;t absorb the hit.  And it feels like as long as I&#x27;ve been conscious (and maybe longer, who knows), we&#x27;ve been in this cycle of &quot;easy money, spend spend spend&quot; followed by &quot;crap, bubble&quot;.  Sure there&#x27;s money to be made on the upside, but there&#x27;s even more to lose on the way down.