14.Perspective on the economy
March 25, 2009 § Leave a comment
the writing about the economy and finance more narrowly has vastly increased, as has the pace of events. as of now the idea seems to be that the Geithner plan might work at to lend, but it is hardly a sure thing. There is a near consensus that the cost will be increased shifting of wealth towards the financial community. there is also very little talk of the real economy outside financial services (sic). The US debt, the falling employment, the decrease in the creditworthiness of most of the population. The asets to be sold stand to be sold at real profit to the buyers (where can I stand in line? I don’t see one!).
The underlying reality that the US was on a crdit binge – not for luxury goods but because wages were falling in real terms – and we do not, should not want to go back to a credit dependent economy (at least to such a scale.). So, less use of credit means smaller economy. So how, in a smaller economy, do we employ more people at higher relative wages?
That is the first major question.
Second is, can we get back some of that wealth? This will be a huge fight.
Third, the impact on the rest of the world.
And along with that, afghanistan, Iceland, Pakistan, Eastern Europe, Mexico..?
And health and education of eneabelers of a healthier economy of solid participation.
So I will not even try to understand the dynamics of the bailout. The writing is too good, no one needs this here. So I will go back to a more general focucus, looking at the world from GardenWorld perspective.
Reading should include
http://www.economistsview.typepad. com and all the daily links there.