1. I own a small business. Our daycare has seen a drop in enrollment directly due to job loss of the parents.
2. I sell payroll to small businesses. Since the summer, start-up businesses are way down and existing business clients are expressing price concerns more than ever before.
3. Family members and good friends are really struggling with jobs and bills.
Let me clarify. The pressure I feel isn't fear, it's more like waiting for the impending arrival of a kick-ass thunderstorm. You see the lightning from one end of the horizon to the other and the thunder rolls constantly; and you just know: "This is going to be serious." It's cautiousness, concern, and curiosity.What will it be like in 6 months? A year from now? How will the landscape be different?
Obama's trying to make a difference with a new TARP bill. I hope it has more impact than the last one where Citi bought naming rights to the Mets ballpark and BOA bought Merrill Lynch and fired people, or where basically every bank in the US came to Capitol Hill with their hand out and got cash. I ASK YOU THIS? Did that ever get to the street? Not that I saw. My clients are still struggling with cash-flow and the banks were tighter than ever.
The new stimulus package that's trying to be passed has some great parts, hybrid vehicles for the government, spending on infrastructure, rebates, and more. It won't be enough. I don't believe that the government can and will do enough to make a dent in the decrepit state of America's economy and job losses.
Click to enlarge this graphic from The Office of The Speaker:
If you think unemployment is out of control based on the above graph wait until you read this piece done by Mint.com. In addition to the "real" unemployment rates, in the 1930's unemployment didn't peak until 4 years after the market crashed. Ohhfa.
So, what's the actionable item here? Hell if I know. I do know that the only thing we have to fear is fear it self.
Maybe this is the forest fire our economy needs to clear out a lot of small problems today and avoid a future "greater depression". Maybe this will cause our government to close the trade deficit gap. Maybe businesses will stop outsourcing jobs to other countries and Americans will stop standing for it. Maybe housing will be more affordable again. Maybe people will respect money more. Maybe Americans will start to save money again. Maybe we won't just put it on credit cards and plan our spending better. Maybe.
A thoughtful statement of world economic problems and their resulting impact on individuals. The coping mechanisms range from global, multinational responses to those that we as individuals have available. Each of us can put his/her own house in order, starting with eliminating unproductive debt, controlling expenditures at a level beneath income (saving the rest) and reaching out to family and friends in ways that will be supportive and appropriate. (Having said that, "forest fires" do serve to clarify and purge individual bad habits in a way that no amount of appealing to common sense can do. It's something like the inadequacy of trying to stop smoking by telling smokers their habits are bad for them.) The lessons we learn at the personal level are just as applicable at the national and global level. Spending money we don't have only postpones the fire and ensures that it will one day be an inferno rather than a blaze that might have been controlled by a garden hose. That is true for our children as well. So knowingly passing incredible debt on to them is akin to criminal behavior. It would appear that the worst excesses leading to our present crisis at the macro level have not only grown out of governmentally caused mountains of debt, but from the financial greed of big banks and unregulated Financial and Investment companies. Why should it surprise anyone that among our population there are folks who are motivated to wring as much money out of others as possible. That occurs in all fields, even when it is not a Ponzi scheme. Even in baseball players' salaries.... In the absence of a financial traffic cop, the financial intersections become disaster areas. Let's hope and pray that our elected leaders will implement regulations that prevent the excessive greed and misuse of public trust and resources. First, we need to find some that have paid their income taxes.... In President Obama we have a leader who is respected globally, and at present, has the trust and confidence of a majority of the people in the US as well. His public statements make sense. His personal life is a role model to nearly everyone. He's having difficulty finding top quality people to fill cabinet posts who also have paid their taxes, but there must be some of them if he looks hard enough. He is asking the nations of the world to work together, to roll up our sleeves jointly, pitch in and do the necessary hard work to help all clsses of our citizenry improve their lives. That's a commendable goal. The engine of our US democracy is a private free enterprize system that produces the wealth for all of us. (Including our elected officials). It needs only that amount of regulatory governmental action that is necessary to keep it humming and healthy. Until that outcome is assured, we cannot hope for a worthy solution. If we as individuals can hold our elected officials to account, we have a chance. That is, after we begin putting our own houses in order as well.... For me, I am an optimist. I believe we can rise above the level of self serving greed and create a better life for all classes of citizens. It would seem that nearing that outcome will be a generational effort however. But that only means that our generation must do it's part and pass on healthy personal and national balance sheets to our kids and grandkids. That is not to say that the present crisis won't get worse. The financial fires are melting the snow all around us. So the sledding is getting tough and will quite likely get tougher. As an optimist, I believe we will learn or perhaps "relearn" lessons from this fire that will assure new growth and renewal. That is not a short term process in every respect, but it is all we have. Big government cannot possibly do it for us! DAS.
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