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The book business has been through such tumult. Clark's books have been available via warehouses clubs, independent bookshops and chains like Barnes & Noble and Borders. An indie bookshop owner once yanked a title of his off the shelf when he did a book signing at a Sam's Club. In her mind, Clark was being unsupportive of indie booksellers in an era when they had fierce competition from the chains.

But what goes around comes around. Now Barnes & Noble and Borders are having a tough time because they can't compete with the warehouse clubs, online retailers and discount retailers like Wal-Mart and Target. So it's the chains that now are in a squeeze play. The indie booksellers who have survived figured out how to offer great customer service and cater to special niche audiences. Where is the room for the chains in the middle market? No one knows. Wouldn't it be ironic if the way people end up buying books again is at indie stores, warehouse clubs or online?

Warehouse clubs are not like normal book stores. They offer a fraction of the selection an indie retailer might have, but they sell their stock extra cheap. A new title from a well-respected author might only get a short run in the inventory. Yet one third of people bought a book at a discount store just last year. The Washington Post reports many authors now do book signings at Costco rather than at Barnes & Noble or Borders. Clark is on Borders' e-mail list and they're getting more and more desperate with the deals they send him. If you're an indie bookshop, it's got to be sweet revenge to see the chains struggling.

CLARKONOMICS: Clark is shocked by the level of debt that Americans carry. In the last year, the average American family's credit card balance was up 10%, according to stats from Moody's and The Wall Street Journal. The average balance on home equity lines was up 8%. In some states, the figures are even more horrifying. Credit card balances are up 15% in a year in California and Florida and up 20% in Nevada! What's going on? As home equity lines get shut off, people have turned to using credit cards to maintain their lifestyle. As a result of that, bankruptcy filings are up 30% year over year.

Amassing lifestyle debt is like walking a tightrope with no safety net. There are a lot of reasons why someone may dig themselves into a financial hole. Maybe you had a job loss or medical problems. But these are the exceptions rather than the rule. On Clark's show, you sometimes hear calls from families with children who are on constrained incomes and they manage to make things happen financially. That may mean doing without possessions that might be fun to have; that's the choice they made -- and it's working for them. That may not be the way you want to live. But the reality is that if you're living on borrowed dough, what fun is it to have anxiety whenever you open the mailbox or pick up the phone? The possessions are nice, but the insecurity that comes with borrowing to get them isn't.

Every other year, the Federal Reserve tests high school and college students on their basic knowledge about money. The most recent test results reveal that the average high-school student got a 48, out of a possible 100, on the test. The average college kid only got a 62. People often ask Clark why they don't teach about money in high schools. Some schools actually do. They may have a lesson about the real cost of a car, for example, in math class. Yet the credit agenda -- not savings and investing -- is pushed in most of the teaching materials supplied to schools by the banks. Visa put money behind an effort to get pre-teens to have their first "Fee-isa" cards called the Buxx card. Thank goodness that effort bombed.

The responsibility to teach children about money lies with the parents, not the schools. Unfortunately, many families consider it impolite to talk about money. But that's a mistake, Clark believes. His second grader has already asked him, "How much money do you make, Daddy?" He prefers to give a non-answer, saying that he makes enough to save for a rainy day; save additional money for retirement; and still pay for their home, car and food expenses. Of course, that answer entails explaining that a "rainy day" has nothing to do with precipitation!

These kinds of talks with your kids need to be ongoing; discussing it just once is not enough. A couple that Clark used to know found that out the hard way. When the father lost his job, both parents told their 2 teens about the sacrifices they'd have to make until he found work again. The parents felt they really got their point across. But shortly after, the daughter came back and asked for $20 to go to the mall!

When it comes to teaching kids, Clark loves the 3 jars concept that came out of the Christian fundamentalist movement. Each jar is marked with a red, green or yellow heart. One jar can be used to hold money for charity; another jar holds money for current spending; and the third has money for longer-term savings. This provides a very simple, clear and tangible lesson for children.

Before 1965, the concept of credit as we have it today didn't really exist. In some cases, you could buy a car on a 3-year loan, but more than likely you paid cash. Houses required a real down payment. There was no complexity about what constituted money. It wasn't a credit card and it wasn't a debit card. It was cash! So watch your kids if they have debit cards. That plastic makes it hard to understand the concept of finite resources.

401(k) plans are in reverse right now. No, Clark's not talking about that massive decline in your quarterly statement. That's simply the give and take of stock investments. Hopefully you're continuing to contribute to your plan. That will soften the blow by allowing you to buy more shares at a lower price.

The reversal Clark's talking about has to do with people trying to put out fires by turning to their 401(k) accounts as piggybanks. Merrill Lynch reports a 23% increase in 401(k) withdrawals year over year. Great-West Retirement Services, meanwhile, has seen a 20% rise in hardship withdrawals when people are facing foreclosure.

People often ask Clark if it's wise to avert foreclosure by dipping into their retirement savings. He usually recommends against this action. As strange as it sounds, sometimes the best option is foreclosure. Think about it: If you wipe out your 401(k) to avert foreclosure and then 6 months later you face it again, well, you haven't really solved the problem. You've just made things worse. You've cleaned out your retirement savings and you'll owe massive taxes and penalties of about 40% when you do next year's taxes. And you may not be able to avoid foreclosure a second time. So then you'll have no home, no retirement savings and you'll owe a great deal of taxes.

Clark's advice is slightly different if you're just getting back on your feet after a layoff or a medical issue. A 401(k) loan may make the most sense if you'll again be able to service the mortgage comfortably in the near future. But if you're barely keeping your head above water, a hardship withdrawal makes no sense. So if you're trying to catch up on an adjustable-rate mortgage; if you face a ballooning balance because of an option payment loan; or if you bought at market peak, you might be better off letting the home go. Finally, don't ever let a medical bill collector intimidate you into doing a hardship withdrawal. A 401(k) is not a piggybank to be raided; it's there to fund your retirement.