Wednesday, January 26, 2005

I wish I had written this :-)

Here is something really well written and accurate: a realistic assessment of the weaknesses and strengths of the US economy. Of course, no one can predict the future. Still, it is possible to understand some of the factors that are a threat to our economy and what we have going for us.

The figures on personal debt (and the linked graph) are surprisingly bad. Almost every smart person who I talk to about the economy agrees that eliminating your personal debt right now is most important; if you have large personal debt, simply stop spending money for a while on non-essentials. As individuals, we have no control over the trade imbalance, when the world will switch off of a gold standard, the effect of research/development/creation of new industries/etc. offshore instead of inthe US, investment in India and China being more attractive in investment inside the US, etc. But, we do have control (more or less) over our own lives :-)

What is needed, I believe, is a longer term view. Favor value to customers over this quarter's financials. Favor investing in your education and other long term investments rather than buying a new car when the old one still runs. For better or worse, the world seems to be more of a place where we have to look out for ourselves, our families, and our friends - do not expect long term employment from companies or fiscal responsibility from our government (and be pleasantly surprised when companies do value employees long term and occasionally a few of our elected officials do the right thing).

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