5/28/2017

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Economic Worries

Many people got caught off guard during the boom times during the years leading up to the economic meltdown of 2008 and 2009. Many financial experts had predicted that the meltdown was going to happen, but with the money making frenzy that was transpiring at the time in full throttle, very few people listened.

The housing market took a nosedive and so followed many other segments of the economy. People are getting laid off, companies are going out of business, filing bankruptcy, and the stock market plummeted to lows that were not seen since the great depression of the 1920's and 30's.

Another big debacle was gas prices. When the housing market started stalling, at the most inopportune time, gas prices started rising, and they rose fast. The big question on everybody's mind during that time was why. If there was a good reason for gas prices to go up that fast and high, that was acceptable. But most people could not see the reason and felt that they were getting the short end of the stick. How gas prices are coming down the way they are now makes many people think that they should have never gone up that high in the first place.

Many people are worried and with good reason. Their retirement funds are disappearing right before their eyes. Billions of dollars are being lost due to rapidly dropping stocks prices and 401k plans and other investment vehicles are re losing money.

The volatility of the marketplace can be seen in every segment of the economy, but what is encouraging right now is the fact that all branches of the government have come together to do something about it and they have agreed, in principle, to work together for the first time in many years. They are all in agreement that something appropriate must be done immediately.

So what happens next? There has to be some serious soul searching by everyone involved. That means all of us. Taxpayers are going to get hit big time and this has left many of us astonished and angry at the size and scope of this mess.

With banks, insurance companies, securities firms, and other financial institutions going bankrupt or sold off at a fraction of what they were once worth, and with real estate prices dropping, along with all the uncertainty in the stock market, as a country, we are faced with a serious dilemma.

The question being asked by most people is why? Who should shoulder the blame and who should be held accountable? The answer is that most of us share some of the blame. We elected the politicians who were entrusted with the economy and they failed us miserably, thereby placing the blame squarely back on those of us who elected them.

But playing the blame game does not solve the problems of the recession that we are already in. We, as a country, have to work our way through this. It's so easy to point fingers, and some fingers should be pointed, but at this phase of the game, we should all work together as a country to bring end this dilemma.

How to stop the downward cycle and nudge the economy into an upward spiral. Can it be done? Yes it can, but first, we have to gain control of the forces that are causing the economy to spiral out of control. It won't be easy, but it can be done.

Within the bounds of the economy, business cycles come and go every few years or so, but the current downturn is much more intense than we've seen in many years. Where it's going to end is anybody's guess. Some economists believe that it's going to get worse before it starts to turn itself around and regain a positive upturn.

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