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by Scribe2 from Arvada and Hartsel

Last Post 64 days, 14 hours Ago


Alright Already
Jul 2, 2008 | 10:46 PM
Category: News
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How long is it going to take and how bad must it be before the business world reacts naturally to the economic climate?  I'm not an economist and am sure I'll be shredded as a result of this post because it strays far from the current conventions. 

Instead of trying to keep prices unnaturally low by stealthily reducing product sizes and boldly cutting staff sizes, I believe business should respond exactly oppositely in a measured manner and let the Federal Reserve go apopleptic.   Rather than aggravate and feed the situation by laying off people who then cannot afford to buy anything or keep what they've got, why not honestly maintain, or nearly so, product standards, raise prices and raise wages?  Maintain levels of primary purchasing by producing product to the usual standards; reducing primary purchases just causes contractions at the supplier level.  The result is more unemployed or wage-cut people who can't spend while the remainder is starkly afraid to.

This false anti-inflationary activity is making the problem worse.   Yeah, yeah, uncontrolled inflation is a nasty monster, but I intuit that the economy reacts like a muscle - if we tense up, the cramp will only get worse and take longer to fade.  Let's loosen it up and bravely spend a little.  EVERYONE. 

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Raysmom read my blog view my photos
Jul 4, 2008 | 6:45 AM

You have it right- the Fed has been overactive, and consumer confidence is hurting because of it.

I talk to intelligent people who think this is the apocolypse, for pete's sake. Then I tell them to relax- it's a free market system, and we are in "change mode", and as long as gov't doesn't try to control adjustments through bail-outs, regulation, and/or subsidization, things will adjust.

The media also is to blame- saying "it will be OK, just keep the faith and do business as usual" isn't newsworthy- they live off of hysteria.

Starbucks is still more expensive than gas, and your thinking not only bolsters the $$$$, it also improves confidence- a win-win. Nice to hear some SENSE on this issue- thanks!
Scribe2 read my blog view my photos
Jul 4, 2008 | 9:51 AM

Thanks, Raysmom. Even when it is scary to do so, I'm practicing what I'm preaching while at the same time jumping off the credit hayride. I'm talking cash spending. Not big bucks, because I'm using those to get myself out of the ugly trap of easy consumer credit which saps today's income for yesterday's pleasures. From now on it's living within my means, even if they're hogtied by paying off debt.

It's not as glum as it sounds, though! Rather than hide at home with rice and beans every day and never eat out, I'll hit the Taco House or some other budget bistro. I'll get a new blouse AND a new toaster at KMart rather than just a blouse at Macy's, with cash left to spend at the garden shop or the local Dairy Queen so they can keep a kid in a job for another hour. My bread comes from the Entenmann markdown store, but it helps them keep product moving. I don't get out and about any less than I used to, but I have returned to my young-mother "big circle" strategy of combining errands and making both directions count.
Raysmom read my blog view my photos
Jul 4, 2008 | 11:46 AM

Yes- it's always wise to make your own adjustments, too! That will let the markets know what is viable and what isn't. And I hate waste- mark-downs have a strong place in the economy, and they should!

Unsecured credit is a trap. When I worked for Norwest, several years ago, they wanted employees to wear a T-shirt that said, "Better Living Thru Plastic!", for a promotion. I'm not usually a rabble-rouser, but I refused to wear it!

Some of the adjustments will force people to live smarter, and that's what a market system is supposed to do- be self-regulating- and many are doing it right, like me and you!

Happy 4th, BTW!
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Scribe2

Shhhh! You'll scare the fish!

Member Since: 12/31/2006


 

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