Hi, my name is Shel and I am so tired of watching the candidates and their camps blame the other guy for the current economic conditions. Like either individual could have changed anything by themselves. But more than that, stop blaming people and work together to find a way to fix the problems. I am no economist (but I play one on tv), but it seems to me that the market is cyclical, we will go through periods of growth and periods of downturns. In the 1990's we experienced a period of growth; however, I believe this growth was exaggerated by the influx of securitized transactions. We were essentially using credit to secure credit. Unfortunately this led to lax lending standards and unscrupulous people (both consumers and vendors) took advantage of the situation. People who should not have taken out mortgages or credit were able to obtain credit. People overextended themselves and the lenders let them.
We live in the age of entitlement and everyone seems to believe that they are entitled to own a house and drive a Lexus, even if they cannot afford it. I see it all the time in my line of work. There were financial people who were unregulated and consumers who did not take the time to understand their finances or ever really think of the consequences of their actions, which led to people living on borrowed time. Well, the markers have come due and somehow people seem shocked that they cannot afford the $300,000.00 in credit on their $40,000.00 per year income. Imagine that.
So now these markers (home loans, car loans, credit cards, student loans, etc) are due and no one can pay, which means the lenders do not have the money to make new loans or investments, which creates a stalemate. The lenders have started going out of business, the industries that they cater to (automobiles, consumer products, real estate) have decreased sales because no one has cash or access to credit; therefore, the business begin to shut their doors and lay off employees. This means that there are many people with even less cash to pump into the economy than before and they begin defaulting on their obligations. It's a cycle that can only be broken by some form of action. Some influx of cash into the economy so that people can resume purchasing services and/or goods, which will create demand for jobs, and so on. The cycle then begins to move toward growth.
This exaggeration of the growth period has led to an exaggerated downfall. But something needs to happen to bring cash flow into the system. Without an influx of cash, our economy will continue to fall. We will all pay for this influx, whether it is in the form of increased taxes from the $700 billion dollar bailout or through more and more people on welfare, we are going to pay for it. I think everyone knows that I am no friend of George W. Bush. I think he is a horrible president. He is not a leader, but I was out voted twice (once really, but that's another argument). Last night as I watched his address to the nation, I think it was the first time I felt anything more than animosity towards him. Now is an awful time to be a bad leader. Right now we need someone that can inspire us, someone that quells the fear we feel while watching our retirement funds flushed down the toilet and our incomes dwindle as the cost of everything increases. I do not know who that leader is, but I am quite certain it is not McCain or Obama.
So while I feel a little queasy watching the news regarding the bailout and I am certain I will be quite angry when I feel the effects of the increased taxes, I know that something must be done to boost the economy. What I want now is for one of our "leaders" to stand up and say in no uncertain terms that the money the government borrows from me to bailout the market will be returned to me on certain terms, that safeguards will be put into place so that we do not need to do this again five years from now, and that regardless of political party, what is really important is the security (financial and otherwise) of the American people. AND I want them to stick to their statements. I want to be able to believe in our system again.
I find it quite funny that the government is using Bill Clinton to reassure the American people. You may have noticed the President on several news programs in the last week talking about the economy and election. While I know this is partly to support Obama, I think it is also psychology. President Clinton was the leader during a period of great economic growth. Whether it was his doing or not, we associate him with a time of economic prosperity, so when we see him on MSNBC telling Chris Matthews that the economy will turn around and to have faith in America, we believe. We are reassured. I think it is a brilliant tactic. That and President Clinton is a great speaker and I've missed that these last eight years.
So the moral of today's story is.... stop accusing everyone, it makes you look petty, small and quite frankly stupid because we know that whether you voted for something or not, you made money off of it. Two, take a deep breath, tighten your belt and do what you can to ride out the downturn in the economy. We are down, but not beaten and being the betting woman that I am, I would never take odds against America. And three, let's demand that the people who want to lead our country stop bickering about crap that means nothing and focus on rebuilding what is great about our country. It's time to put up or shut up, boys. Show us what you are made of or go home because I have more important things to worry about.
Not quite my usual nonsensical fare, but even I have to have a deep thought every now and again. I will leave you with a little funny, just to take the edge off. They say laughter is a great way to relieve stress, so here ya go...
Until next time -
~Shel
