This might just all be coincidence, but in terms of a few business people I talk to (real estate, personal coaching, photography, and myself - graphic design) semi-regularly, they all tell me business is slow and has been for quite a few months. My dad, who buys, sells and leases heavy equipment, tells me the same thing. I'm definitely seeing a slow down in terms of the amount of calls I get and the number of people replying to my ads. Anyone else have experiences they'd like to share? Is the economy facing another great recession?
Well, coaches and creatives are the last to be re-hired. Heavy equipment might be under pressure from China.
We already know that the huge cuts Republicans pushed for in the sequester was going to destroy ~1 million jobs. If that doesn't push us back into recession then it will certainly greatly harm growth. It's just retarded to push for cuts right now.
The economy is always facing another great recession. The 50s and 60s are gone; forget about them. The root problems of society's financial structure have not been dealt with, and will not be dealt with. Since a stable and trustworthy means of exchange is one of the essential elements of a sound economy, our economy will never be all that stable. Succeeding governments can do a bit to make things better or worse, but they can't deal with the root problems, either. The biggest recession of modern times has not yet happened. It is even virtually certain that sooner or later there will be (at least) one that will be worse than the great depression. When an economy is based on money, instead of on the production and exchange of useful goods and services, it cannot avoid such problems, because money simply cannot be all that stable. As a "shortcut to wealth" instead of being actual wealth (it is not, in itself, a useful good or service, but people don't realize that and think they are "rich" because they have "a lot of money"), it is too subject to manipulation, speculation, scares, bubbles, and all manner of other sources of instability. It should be noted in passing that replacing fiat currency with gold, for example, would do very little to alleviate this problem. That still would not deal with the root problem.
Yup. There have been several Chinese companies that have approached my dad regarding buying his company and using his vast customer base to sell shitty Chinese equipment to. He says the equipment coming out of there is truly shit. I warned him that Datsun, Honda, and Toyota started off as truly shit many years ago, but look at them now. However, he plans to retire in a few years so he says it won't be his problem then. China's economy ain't been doing too hot lately either. In Canada, they say we are in for a real wake up call. We got through this last recession ok so far because Canadian hadn't stopped their spending ways as much as the rest of the world. We just put it on our credit cards. Now the news says Canadians are pretty tapped out. I've only got maybe 1.2k on my credit card that I've left for two months so I'm lucky compared to most people. I heard most women my age (30 to 35 bracket) have around 20k in debt.
South Korea recently announced a new stimulus package designed to help improve the slowing economy. http://www.bbc.co.uk/news/business-22162383 It looks like the slow down in China is real bad news because with the EU in recession and the US & Japan just breaking even the only big economy which was still growing was China. The Chinese government is denying they're in recession but the numbers don't look good.
The economy is beyond the shitter. It has passed the event horizon of the magical stargate and is now sinking deeper and deeper into the septic tank. Once it finally settles on the bottom, what's left will start being torn up and completely dissolved by bacteria otherwise known (in this case) as penniless masses of hungry people.
The problem is, money is dealt like a commodity. That's not new, interest has existed for at least 6000 years if not longer. Worked most of the time too. But money as a pure end in itself is relatively new. Not so long ago people wanted money to buy shiny stuff. In the last half century or so, money itself went shiny and is collected just to have it. The more a very few amass and take away from the real world economy, the deeper the problem will get. And no, I'm not arguing 'socialist' measures. However, the only idea I have to tackle the problem is regulation.
The Chinese are just as bad, if not worse off, than we are. They have the second largest economy "on paper" but they've been manipulating their currency for so long that it is beginning to catch up with them too. But, you'll never hear the Chinese admit to anything like that. To the Chinese their country is just like North Korea: Good Time, beach party, always! :economy:
China lowers the value of their currency so if they stopped it was raise. The bad news is this would hurt exports but the good news is it would increase the buying power of 1.3 billion people. Sadly, China does not have unemployment insurance so anyone who becomes unemployed due to a currency reevaluation by the markets (assuming they let that happen) will likely be fucked by the resulting lose of jobs in export industries. The good news is the other countries might actually see their economies improve due to fewer subsidized stuff coming from China and more domestic production.
Newsflash folks, the US has been devaluing our currency as well, the Federal Reserve has always done so, but especially vigorously since '09. That would roughly match up with the infamous "summer of recovery".
And yet inflation is damn near zero because the increases in the money supply pretty much balance the decreases in the money supply as well as deflationary pressures. The fed can just as easily delete electronic money as it can create it thus hitting it's low inflation targets.
I think it has more to do with you talking to people mostly in businesses that are still recovering like real estate or else luxury businesses like personal coaching and the arts (photography and creative design). It makes sense that business is slow for those services.
That is not inflation, at least not all of it. Inflation itself is rather low since the central banks 'print money', sure - but they suck it out of the markets in other places.
I'm not quite certain they they can't be dealt with, in a theoretical sort of way, but I don't think they will be dealt with, and I'm not sure that anyone has any good ideas of how to deal with them, either. I had written up a response to Aurora's post (with which I agree), in which I went into some of the issues, but a problem with my internet connection ate the post and I don't have the inclination to re-write it all. The post basically said that the root of the problem is money, though. Money should not be a commodity in itself, but merely a means of exchange of commodities. True wealth is goods and services from which you profit. Money (even gold coins, for example) has very little intrinsic value in itself. Certainly not nearly as much as we attribute to it. The "value" of money is thus very subjective. Being subjective, it cannot be stable. Instead of seeing it as a way of exchanging goods and services in the hope of increasing wealth, people see money as wealth in itself. "How rich you are" in modern society almost always means "how much money you have". But as soon as money is a goal in itself, and is not actually something "real", it is subject to all the problems of speculation, inflation, fraud, bubbles, and everything else that introduces instability into an economy. I'm sure there are various regulations that will help to deal with this problem, and they certainly ought to be applied (though that by no means endorses the "all regulation is automatically good" mentality; some regulations are worse than the problems they are intended to "solve"), but the real problem is money itself. I can't think of any way around the use of some form of money, however, other than a barter economy. And a barter economy simply cannot work on the scale needed to produced the kind of wealth (real wealth: the useful goods and services we all enjoy dailiy) that modern society has produced. If anyone does have any good ideas, however, I'm all ears.
I would comment on all this but someone might tell me I don't understand sovereign debt or something. So I'll just watch all the smart people fall down.
You know, you can get to understand sovereign debt if you wish. It takes about ten minutes of reading for the basics.
Well, correct me if I'm wrong, but this analysis would imply that the problems that exist always have existed. But I'm not sure that's the case. You yourself mentioned the 50s and 60s. The problems appear to have arisen after that. Financialisation However, I agree that it's extremely difficult to think of a way out, particularly one that cannot be blocked by those who have vested interests in the present money system.
