The Long Financial Hangover
I think most Americans are coming to the realization that this recession/depression we're in will be around for awhile. People aren't as likely to believe the Wall Street cheerleaders on CNBC and the lamestream media like they did back in the mid-2000s.
Government and media have perpetuated the myth that the economy is like a big machine they can tune-up to make it run better. Push this button, pull that lever, jigger a switch - and voila! The economy will be back on track and good as new.
The fact is that the economy is more like a living organism than a machine. When you feed it too many stimulants or drugs (fiat money, easy credit and short-term tax incentives), eventually it needs a break to "detox" from the stimulus.
With the huge amount of debt at the federal, state, corporate and household levels that need to be flushed out of the system - either through default or repayment (more likely the former than the latter) - before we can truly see economic recovery.
This could take a long time. A trusted source of mine mentioned that a friend of his had a long-term government contract (more than 5 years) with an agency that works with banking institutions. That tells me the government doesn't believe this financial "hangover" will end quickly or easily.
And you shouldn't either. There will be opportunities to make money and prosper in the years to come - probably not in the places that you found them in previous years. Be prepared to look for and act on new opportunities in new markets, like a vigilant surfer. The "waves" of opportunity will probably have smaller windows, but they'll be good ones nonetheless.
Government and media have perpetuated the myth that the economy is like a big machine they can tune-up to make it run better. Push this button, pull that lever, jigger a switch - and voila! The economy will be back on track and good as new.
The fact is that the economy is more like a living organism than a machine. When you feed it too many stimulants or drugs (fiat money, easy credit and short-term tax incentives), eventually it needs a break to "detox" from the stimulus.
With the huge amount of debt at the federal, state, corporate and household levels that need to be flushed out of the system - either through default or repayment (more likely the former than the latter) - before we can truly see economic recovery.
This could take a long time. A trusted source of mine mentioned that a friend of his had a long-term government contract (more than 5 years) with an agency that works with banking institutions. That tells me the government doesn't believe this financial "hangover" will end quickly or easily.
And you shouldn't either. There will be opportunities to make money and prosper in the years to come - probably not in the places that you found them in previous years. Be prepared to look for and act on new opportunities in new markets, like a vigilant surfer. The "waves" of opportunity will probably have smaller windows, but they'll be good ones nonetheless.
posted by Brian Ochsner | 11:27 AM
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