Economy

[LiL stumppy]

Forgive me, I am a total n00b when it comes to this stuff. I quit my job a few months ago (bad idea) and now can't find part time work anywhere. I see everywhere people are taking pay cuts or are getting let go because of the economy. What make an economy bad? I always thought that if people were spending money then everything is good. So why can't people spend more money? Is it the fact that food and everything is getting more expensive?

Please no politics involved.

[gblowfish]

Watch how fast I can move this thread:

8 Yeas of The Bush Administration makes the economy bad.

Off to the DC with lightning speed!

[LiL stumppy]

Originally Posted by gblowfish

Watch how fast I can move this thread:

8 Yeas of The Bush Administration makes the economy bad.

Off to the DC with lightning speed!

I was originally going to post it in DC, but since I wanted no politics in it I posted it here.

[ClevelandBronco]

Originally Posted by LiL stumppy

I was originally going to post it in DC, but since I wanted no politics in it I posted it here.

Sure. That'll work.

[Gracie Dean]

well, it really can not be talked about without politics

[Reaper16]

Originally Posted by LiL stumppy

What make an economy bad?

A workforce that speaks like that.

[Buck]

I have no idea.

If I had to guess, I would say its because too many people spent money that they didn't have.

[Mr. Flopnuts]

Before jumping the lil stump man remember he's in high school and is just asking an open, honest question.

My open, honest answer stump is that the people who have the most money of us all are greedy and want more. Since they've bled it for everything it's worth, they're trying to scare us out of more. So far it's working.

[LiL stumppy]

Originally Posted by Mr. Flopnuts

Before jumping the lil stump man remember he's in high school and is just asking an open, honest question.

My open, honest answer stump is that the people who have the most money of us all are greedy and want more. Since they've bled it for everything it's worth, they're trying to scare us out of more. So far it's working.

Thanks for the input.

What if people started spending money again, instead of "saving it for bad times?" Wouldn't that help?

[ClevelandBronco]

Originally Posted by LiL stumppy

Thanks for the input.

What if people started spending money again, instead of "saving it for bad times?" Wouldn't that help?

Saving money is the same as investing money. The money doesn't just sit in a coffee can on the shelf.

[beavis]

Originally Posted by LiL stumppy

Thanks for the input.

What if people started spending money again, instead of "saving it for bad times?" Wouldn't that help?

Actually, IMO, that's what got us into this mess in the first place. All spending and no saving.

[PhillyChiefFan]

Originally Posted by beavis

Actually, IMO, that's what got us into this mess in the first place. All spending and no saving.

This.

People purchasing houses they could not afford. The American Dream was telling them to spend more than they had, same with credit card use.

When people spend money it does make the economy grow and expand, but the USA has been growing for years now and people got comfortable spending ungodly amounts of money on a credit card. Keeping up with the Jones' became a way of life, and now its biting these folks in the butt.

People are scared, and are therefore not buying new cars, houses, boats, etc. This forces businesses to use the cash they have on hand to pay their employees and the electric bill and not expanding their business. This causes growth to come to a grinding halt. People are pulling money out of the stock market, and it just becomes one big domino effect. Trillions of dollars on paper, have disappeared.

People who are of retirement age can't even retire, because their nest egg has been hit so hard. My dad has lost 25% of his retirement fund.

Hope that helps, its a tough question because there is SO much involved with the economy.

[Hydrae]

With people running scared, those that still have disposable income are less likely to spend it and more likely to save it "just in case." As a result, consumer spending goes down, companies lose sales and revenue and wind up having to adjust in the easiest way of all, with their payrolls.

This is the problem with being a consumption-based economy, if people don't spend the whole thing freezes up. That is the reason for those 2 rebates, to try to get people to spend money to keep the wheels going.

Beyond that you are getting into political territory. If you want to learn this stuff in more detail, go get dirty in the DC forum. There are some pretty smart, knowledgable people over there believe it or not.

[chasedude]

One word made it all happen, GREED

[DJ's left nut]

Originally Posted by chasedude

One word makes our entire country run, GREED

It wasn't greed, it was stupidity. This entire economy is built around trying to make more money for yourself.

Stupidity in the lending industry led to a paper loss which sent people into a panic.

The media has made things infintely worse by telling people that everything sucks. Think about it: Everyone said we had to pass that stupid bailout or the banks would collapse. 700 billion in debt is rammed down our throat, none of it is doled out (Paulson's sitting on it) and yet the banks are still here.

How could that be?

Answer: the stupid stimulous wasn't needed...ever. The banks weren't crashing, the debt service wasn't going to make us sell off Alaska. Things were pretty good outside of a few bad banks and a handful of really cruddy regions where land prices were way too high and an adjustment was necessary. But once that sucker went through, the folks that control most of the country's money realized we'd just made a large mistake and pulled out of the market.

The economy wasn't actually as bad as it was made out to be. When the media tells everyone that the place is going down in flames, it's a self-fulfilling prophecy. Nobody hires, nobody spends, the multipliers don't work and we stall out.

[begin politics] Had the media not been so hell-bent on painting everything as dire and horrid to get Obama in office, we'd be out of this thing by now. The big 3 meltdown (again arguable) and every other true major drop has been a reaction to a non-existent panic. The only actual problem was the real estate market when sub-prime fell. What nobody mentions is that most of the losses were centered among land speculators/developers. A bunch of idiot land speculators taking a bath on real estate does not fuel an economic crisis, jackass manipulators in the media do. [/end politics]

Bottom line: The media and a stupid federal government (both sides of the aisle) screwed us on this one. They created a recession from an isolated market correction.