Blind Economics
Sat., July 19, 05:51 PM
"There are no so blind as those who refuse to see.
Am I upset? Is anyone as disturbed as I am about the state of the economy? None of the “reassuring” messages I’m hearing are comforting me in the least, because none of them ring true.
Headline: “The recession ended in November 2001.” Excuse me? If that’s the case, then their definition of recession is different from the one I learned.
It’s not unusual that what was always true isn’t true any more. It’s not even unusual that people will say, “that’s the way we’ve always done it.” Getting those in charge to see that another way exists is often difficult. (Ask anyone whose job is “implementing change.”) But I am very much concerned that some of our most brilliant people are not seeing what’s right there.
I’m very troubled about the employment situation. For those of you who have jobs, you must be grateful. Those who have lost their jobs – I’m sure you know someone who has – may understand more of what I’m saying. Economists look at the unemployment figures without realizing their fallacy: not everyone looking for work is counted in those figures. The unemployed stop collecting when their benefits run out, by which time they may be too discouraged to look further. I traveled that route for years before I decided I could manage without full-time work.
Wars used to have the side effect of providing lots of jobs, but it didn’t happen this last time. Has anyone bothered to wonder why? Lowering the prime interest rate used to improve the economy. How much lower does it have to go before they find out that isn’t working either? Mr. Dubya has yet to understand that tax breaks for the rich do not trickle down into benefits for the poor. When rich people have more money, they pay for goods and services from other rich people.
Who are the advisors who told that man you could pay for a war and still give out tax cuts? What the heck are they thinking? You can’t live on credit forever. Somewhere, sometime, someone will have to pay the bill. Just because you put numbers on the left side of the sheet to match the ones on the right side of the sheet does not mean that the budget is balanced!
I’ve also heard that the market has made a comeback. Yeah, right; you know I do not trust the market. Gamblers pushed the numbers out of proportion so badly that a fall was inevitable, and I never expected it to go back to where it was. Of course, the experts aren’t that it has; they’re just saying that the market has improved over the last five or six months. But you can’t prove that to me either.
I have a small brokerage account that is basically my retirement account because I didn’t work anywhere long enough to have an employer set me up for retirement. Occasionally I buy or sell something on the advice of my account manager; this is a very conservative account. It doesn’t lose a lot of money at the worst of times. But until I see three consecutive months in which it hasn’t lost anything, I will not believe the market has recovered.
Another guideline I have is what I call my “cash account.” My personal payments, including my earnings, are paid into that account. I transfer funds into the bill-pay account, and I also withdraw cash from it. It’s a good month if more comes in than goes out. This month, of course, it’s property taxes – more out – but I guess we should be grateful we still have property.
A third guideline is the ads I receive, what people are trying to sell me. I get more junk mail and spam trying to sell me loans and credit, which – most thankfully – I don’t need. Individuals, corporations, and the government are all spending more than they’re earning, and where will that lead? What happens when more bankruptcies occur than the creditors can bear? What happens when all the lending companies run out of resources? (That probably won’t be all bad, they’re so slimy they deserve it – except that their employees will then be trying to collect unemployment.) What happens to funds and foundations – both private and government – when the beneficiaries outnumber the donors?
Am I upset? You bet I am. I’m currently using my IRA plus my social security to pay for health insurance. My retirement fund is unsteady. How can I answer the most personal question of all: will I ever be able to retire??
