Reply to Wow! Anyone else listen to the Diane Rehm Show today?

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[quote=Anonymous]I don't know. My DH was in financial services so we got hit with the earliest wave of this crap and it basically bankrupted us in our 40s. We know we will work until we're 70, at least, if we ever retire. But, I was also born into foster care, was very poor during my childhood, graduated college in a recession ('91), took years to find that first job, and have basically struggled to put food on the table for most of my life. None of this is news to me. I say all this only to show that I'm no pollyanna who lives in some fantasy land.

Yet, I still think the gloom and doom talk about the economy is hyperbolic and unrealistically pessimistic. America has a LOT going for it, as do Americans. We have much better incomes than most of the world, we're the best market in the world, and we have an unparalleled capacity for innovation and entrepreneurialism. Plus, our competitor nations are aging much harder and faster than us, and we are far better at integrating immigrants, which gives us an external source of labor that most other aging economies don't have.  In the long run, we are really in a good position.  Yes, we need to improve education (especially grade inflation, IMHO), but there's too much looking at our weaknesses and not enough looking at our strengths, again IMHO.

In the short term, I think that what happened is that we all forgot that the economy doesn't always grow, we spent too much on consumer debt, and now we're in a phase where we're all knocking that debt out. Once we get into a better equity position on our homes (paid equity, not market) and with our credit cards, I think things will get better. The private sector is creating jobs (it's the government job losses that drag those numbers down), which I think is very important.  Also, the private sector has been squeezing blood out of a stone in terms of productivity per hour, and will have to start hiring at some point. It will be temporary work, but as businesses realize they can afford the "extra workers" things will calm down. I see a few more years of anemic growth (2-3%) as people knock debt out and businesses adjust their workforces, but I think we will return to a better equilibrium point much sooner than many people might think given how dark it sometimes feels now.  [/quote]

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