By Jeff Reinke, Editorial Director, PD&D
 "Eventually, the warehouses will run dry, causing production to pick up and grease the wheels of our economic machine. |
It was a time of economic peace and prosperity for the inhabitants of these United States. Then late last summer some rumors of a Phantom Menace began pilfering our halls, and we were soon confronted with the collapse of several key monetary institutions. Our republic fought back in providing an emergency stimulus package to help stabilize the economy, but the shadows of an evil presence had already begun to trouble many.
Then a full-out Attack of the Loans began to take their toll on our country’s economic resources. In summoning all of our efforts, we couldn’t overturn the damage that had already been done. Alas, the spending forces were simply not with us. Then we were forced to deal with the full-fledged Revenge of the Spiff, as companies that had overspent or mismanaged their dealings were forced to lay off workers, close down plants and eliminate corporate luxuries in order to stay afloat.
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New Hope has now been presented in the form of recently anointed political Jedi that many feel will bring our country back to a time of growth and prosperity. However, despite these initial efforts, the Economy Struck Back with numerous realities that our knight in training probably never anticipated. The Wall Street rebounds expected after his clash with the dark side of our economic situation didn’t immediately materialize. However, we now seek the Return of our Jedi’s promises in looking towards a time when the dark side of these economic powers will be overthrown and order returned to our monetary galaxy.
The annoying issue surrounding our recovery is that it’s really a matter of time. (Sorry, I’ve run out of Star Wars references.) The U.S. represents the most lucrative consumer economy in the world. And although eight percent of our workforce is unemployed, 92 percent are working … and spending.
Eventually, the warehouses will run dry, causing production to pick up and grease the wheels of our economic machine in getting more people back to work making, selling and distributing those products. In the mean time, we work with the knowledge that better times will come and that staying true to the right principles of innovation, ingenuity and focused design applications will get us through.
The understandably tough part is keeping an eye on what the future can and will hold without falling prey to the difficulties inherent with the current situation.
May the force be with you.
I’d love to hear your thoughts on the subject. Reach me at jeff.reinke@advantagemedia.com.
Jeff, Nice analogy to Star Wars. I agree with you whole heartedly, though it's unfortunate that the Kings and the Queens on the Hill see the situation differently. Everyone has stopped buying Widgets, both large and small. Eventually the Widget factories will have to start building more Widgets to support new demand. Evidently, the Washington D.C. Hill folk think that throwing money at this situation will magically make people spend. I don't think so. The economy will sputter to life eventually, with very little outside intervention, and we'll be back to making more Widgets. Of course, some companies make Widgets that people no longer want. Maybe they should change their business model (for some reason GM comes to mind). Two items bother me though about our current economic/business model. 1. Widgets are becoming increasingly complex, full-featured, and reliable. Hence, people do not have the motivation to go out and buy the next Widget that comes out, whether it's a new phone, computer, or automobile. As an example, Automobiles last far longer these days than 10-20 years ago, so many people do not replace their's every 5 years or so. Likewise, the computing power of desktop/laptop computers has leveled off, so large growth has tapered off in the last several years. 2. The incessant need of companies to forecast excessive growth figures lest they get a poor review from Market Analysts (the so called voice of the stock-holder). Growth then accelerates to the point of non-sustainability, and the market then declines once more. Wouldn't it be nice to figure nice long-term, stable growth rates on the order or 1-5%. What's so wrong with having a near-level growth rate? Maybe we wouldn't have such drastic swings in our economy. Regards, Greg
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