Thursday, October 18, 2012

Is the economy a lost cause? - 1 - - MSN Money

Is the economy a lost cause? - 1 - - MSN Money

New research here from Northwestern University this is PDF file of a great paper! 

This is a very interesting theory and could mean we are in
 for a not so bright future.  I hope we are going to see technology improve the economy down the road but it seems for now it is not working to increase the standard of living in the country.  It may be creating jobs elsewhere and it may be that we have more new gadgets that are dropping in price but it is questionable as to whether or not we are progressing as a society.  Or have we just gotten used to unrealistic prosperity?  This research makes an interesting case for the "new normal" might not be so great. 

Imagine our economy right now if the people were not making money on the Internet or if the cell phone companies were not generating so much income just by selling data packages?  It seems as we have gotten into the information age we have become more efficient at getting things done more cheaply and with less people.  Also we have found ways to get labor for far less pay in other countries.  It is the way of free trade but also maybe just a product of the times and how things evolve. 

It is also interesting to see just how devastating the housing market collapse has been on the country.  the government took for granted the goose that was laying golden eggs for years.  They took their eye off the ball and let Wall Street kill the goose.  The housing market and industry was the only thing left that was keeping the country prosperous.  In typical fashion the politics of greed and self preservation caused the average American to get wiped out. 

We have lived with trust that our homes would not depreciate 50% and that we could count on this to help us through retirement.  We were lulled to sleep by the politicians and the magicians on Wall Street as they pillaged the last golden goose of the age.  With the housing market down and out, jobs can not recover.  There is no way to make up for all the construction, title, appraisal, realtor, handyman and mortgage banking jobs lost due to the housing crisis.  As we watch both parties pander as well as the can to either side, it is clear that neither party will likely do what is necessary to allow Americans to ever regain their trust in our financial institutions and our government. 

We know banks are getting a free ride and a bailout on top of a bailout when they are getting paid several times over for a toxic mortgages they have bestowed on the taxpayer.  It it time to figure out how to generate an income that is based in technology and the Internet.  It looks like the future of the jobs market will be weak for years and that wages will be down for a number of years.  It might become a necessity to have a home based business of some kind even if people are employed full time. 

We can only hope for better times ahead.  What I have seen so far this year and in politics it does not appear that anyone in Washington really gets it and likely the newly elected will follow the same path. 

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