Fear, Loathing and Market Recovery
It's down to one thing in the world we live in: FEAR. Fear of job loss, fear of survival, fear of no retirement, fear of falling values on one's home, fear of banks failing, fear of things getting worse. Take your pick, the boogeyman's out there.
If people continue to be afraid, spending on a macro scale will continue to decline which will eliminate more jobs, more companies and more stability (for as much as there even is today). The less people spend, the less likely we are to see any type of recovery in the near future. Make no mistake, I've never been much of a Keynesian when it comes to economics but these days I'm starting to wonder. For the record I'm loosely defining that as one who believes in spending our way out of a recession.
I was watching a CNN interview with Martin Wolf, a noted economist and writer for the London Financial Times. Mr. Wolf, while also a non Keynesian, stated that since we have already passed the stimulus bill and the money was going to be spent anyway, the most important thing we can do is get the money into people's hands who will actually spend it. In his opinion the biggest challenge to where we are is that the President is hell bent on the whole 'roads and bridges' philosophy which will do nothing for at least 18 months on the national economic front that in Mr. Wolf's opinion is wayyyyyyyy toooooo late. Mr. Wolf flippantly shared at one point we'd have been better off walking out and handing people money on main street than allocating it the way we have. We can have the argument on how to improve the current mess in terms of massive tax cuts versus massive spending but being where we are, spending the money properly in a way that would make things better is now the discussion. It's not one that will likely be resolved soon.
Having stated the obvious, here's sublime of the where we are. I don't know exactly when we will see a huge turn in the economy but I am convinced that right here, right now there are unprecedented opportunities for success. Opportunities in the stock market, opps in the real estate market, opps in employment in the form of new demand for different types of skills. They are out there....and in the face of fear those who have courage will change their lives for the better. Some will buy stocks, some will buy real estate, some will reinvent themselves and their personal brand and change careers and their lives forever. Some will get entangled in the fear and suffer. Some will embrace where the world is and prosper. The only question for each of us is which path will we take?