by John Landrine

Created on: January 19, 2007   Last Updated: May 10, 2007

Often our children can ask questions or make comments that seem to go beyond their scope of knowledge and understanding; and, of course, our response is usually to dismiss such remarks as humorous, coincidental banter since the child could not possibly comprehend the true meaning of their words. However, is it possible that sometimes the children can simply see things a bit more clearly that we as adults?

My grandson must have been only five years old when he asked me about interest and credit. The conversation came up about buying on credit as we were out shopping and he saw me using credit cards. So Lil' Bill did as I had instructed him to do and that was to ask questions about anything he did not understand.

After thinking about it for a minute or so, I said, "Well, let's say you go into a store and you want to buy something but you don't have the money. You can buy it now, even without the money and take it home, today, but you will pay for it later. That is called credit: you buy it now but you don't pay for it until later."

I looked at him with a sort of, are you still with me' look, to which he nodded his head as if to say, yeah, I'm with ya'.

"Now," I continued, "When you pay for it later, you pay a little more than it costs and that is called interest. So, you buy it now, but pay for it later, that's credit and you pay a little more later and that amount that you pay extra is the interest."

Lil' Bill sat there and thought deeply about this for a minute and I wondered if he really understood the concept. Then he replied, "So, you don't have the money to buy something.....but...you buy it anyway....and you pay MORE for it?"

They way he said that shook me a little, but I had to answer and said, "Uh, well, yes. I guess that's right."

He thought for a few seconds more and then, as he looked at me in the most sincere, concerning face said, "WHY would anybody want to do that?"

I just broke down and cried, "I don't know! Bill, I just don't know, ok! You're right! You are right! The whole economy of the free world doesn't make any sense! Everybody is in debt; the country owes trillions of dollarsyou're rightit's crazy! We're all crazy!"

It took a few minutes for the child to calm me down and assure me that everything would be ok.

I then asked him if he wanted to run for President. He said no.

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