Question: Can someone explain the subplot with the Margaritaville and Stan going to a bunch of places trying to return it? It's really confusing. And this sounds stupid, but in a recession, wouldn't spending money be bad?
Question: When Stan first tries to return the drink machine, an employee explains that the store just takes an initial payment, then remaining payments are handled by a separate finance company. How does the store even make a profit if they only get the initial payment? I know this is a TV show, but it sounds like the banks who let people mortgage homes for small down payments in the late 2000s, then sold the debt to other companies.
Answer: The store sells the debt (at a discount) to the finance company, which then has the right to collect the balance due. This frees the store from the administrative burden of tracking payments and transfers the risk of non-payment to the finance company. This scheme usually works best when there is a huge markup on the product.
Answer: Essentially Stan was trying to return the blender that his dad, Randy, had bought because he knew his parents couldn't afford the extra debt. The blender, which represented mortgage-backed securities, had been bought on payment plan, meaning Randy had to make monthly payments, with interest, on something that wasn't essential. The episode represented the recession that was occurring at the time, including the housing bubble and mortgage crisis going on, so there's a lot going on. However, the payment plan (which is to say the debt) had been sold to another company by the store that sold Randy the blender. (To explain why, because of the recession, the store needed cash on hand, and they would only be getting a little money each month, if Randy paid his bill. So the store sells the debt to a company who gives the store the money upfront. Think of the J.G. Wentworth commercials, "I have a structured settlement, but I need cash now".) Because the store sold the debt, in ridiculous fashion, Stan had to return the blender to the company that bought the debt, although they too sold the debt to another company. Finally he gets to the U.S. treasury who tells him his blender is worth $90 trillion (again a ridiculous exaggeration) meaning that the debt owed is greater than the product is worth and to deride the way government agencies set up their budgets (which requires much more complex economic lessons). Kyle's whole point was people shouldn't fear the economy or see it as a vengeful being, but continue to spend and live as they normally do. Economically speaking, not spending money during a recession creates a longer lasting recession, and to solve a recession, people should spend money, although people and businesses shouldn't acquire debt during a recession because interest rates are higher. But on a personal level, individuals are fearful of losing their jobs during a recession, so they save money in case that should happen. But again, this is complex economics lesson.
Bishop73