Afterpay
In the Make me Smart podcast episode 332, there was a question: “Dollar General are popping up everywhere. Yet people will spend $100 on leggings and pay in $15 installments. What’s up with that, the afterpay?”
Afterpay is big business. You may even have noticed a little Affirm logo on websites. Affirm is a new and hot fintech company, that is about to go to IPO to raise $100 million at a $10 billion valuation.
I came to know about afterpay in Argentina, during the crisis. When folks who needed a new fridge but could not pay for it up front, could do so through quotas or installments. (There is also layaway, where you pay a deposit for later purchase. That was also new to me.)
When you consider how wages flattened since 1971, a decreasing personal savings rate, and yet goods became a lot more expensive, it is no surprise that people can not afford new things, and need creative ways to pay for their purchases.
But really, what happened in 1971? (There are a lot of interesting graphs at https://wtfhappenedin1971.com/)