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Economic Report 2009 a Look Ahead
The trick to righting the economy is (as all politicians know) perception. This is the theory that if everyone thinks the economy is doing well then the economy will do well because everyone will feel that their money is safe and everyone will be willing to spend in turn stimulating the economy. For example, you may have noticed that the news media is producing a contrasting outlook to the economic crisis than the politicians are giving, this comes down to perception. The politicians want everyone to think that the economy is ok so everyone will start spending, and the news media want, well bad news is good news. Although this may seem like a noble act, the government couldn’t care less about you, traditionally all the government incentive has come from the pressure of lobbyists and the threat of not being elected next term, so as long as what they’re doing looks good then they’re not worried. This does not differ for the economy; as explained above the natural forces of the economic cycle flow up and flow down, the governments job is to try and steady this flow so it can be a constant increase (the morals behind it are to keep the economy stable, the real reason behind it is so the government doesn’t have to cop it when the economy naturally goes down). The government attempts to steady the flows by taking away from the growth in the boom times and adding it onto the recession times. Although this may seem reasonable and “the safe way” what is not explained is that this does not always work (as proven in the last couple of months), the government knew this and the banks knew this, but the attitude towards it was “we’ll deal with it when it happens” but unfortunately now it has happened it has been worse than anyone predicted so little could be done to stop it falling, hence the economic position we are in at the moment. So now that the issue has been addressed what can we do to stop this one and prevent future events like this? Well there is no a simple solution to make everything better so for the moment the world will have to put up with the downturn but there are two solutions that may work: 1. Everyone unites and instead of saving those few extra pennies on anything spend them; this may not appeal to everyone and put into practice probably won’t work and unless it’s done by a vast majority then it won’t work at all (this is the strategy the government has taken) 2. The powers of the government are reduced and trade barriers are broken and economic strains are weakened. The lesson to be learned from this crisis is that no one can fully control the trends of the market, there will be times of boom and times of recession regardless of the changes imposed by laws, or taxes and as America has shown us no one in immune to the effects of the natural economic flow. About the Author:
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The world, like any country, like any business, follows a trend of ups and downs. This trend can vary from intensity, but as the past has proven no matter how far the trend has fallen it will always right itself. The economic state at the moment is no different, so despite all the warnings of doom there is still a silver line to the cloud.
taking control? I am quite sure after reading the thoughts of this author even in such a short article that we are going to be in hands. |
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