Whenever the stock market has a
correction, as these deep market drops are called, the market comes back over
time. True, it hurts in the short run, and the people who got scared and sold
their stock at market bottom will feel the pain the most, but the market always
comes back, so selling off stock is a bad idea, that is unless you need cash to
pay immediate bills. Going liquid in a down market is the proverbial buy high
and sell low scenario, and joining in only perpetuates the problem.
Meanwhile, Chrysler and General Motors are
considering a merger to help both survive the economic crisis. The fact is that
because of the short term situation, they may not have much of a choice, but in
the long run it may not be good for the overall economy.
The fact is that most of the economic problems we
face now are based on fear. Fear that people can?t pay back loans, fear that a
bank loaning to another bank may lose their money in the event of a collapse,
and fear the list goes on. Businesses are not loaning money strictly based on
fear, and that fear has turned to paranoia.
What
does Congress do? They go on vacation to campaign. That?s part of our system so
it won?t change easily, but Congress should have stayed in session a little
longer and planned a quick return after the elections to, well, do something,
anything. The fact is that the U.S. and world economy need a confidence boost
more than anything else right now, and Congress ignoring the problem does not
give confidence to consumers.
What we need now is
leadership, not ostriches sticking their heads in sand and pretending nothing
is happening around them. Instead, what we have is four people fighting over
who should be the next leader, while the current leader issues one lecture a
week, probably because he has nobody in Congress to confer with, since they are
all on vacation. Think of it as the captain of the Titanic allowing his crew to
take suntans so they all look good when their bodies are found. |
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