Economics: How do we get our economy going?

[Nocturnal]

Hi, I never took an economy class, yet. I was wondering what makes our economy so crappy? What boosts it? What helps it? If something helps it, why does it help it? Was this "tax credit" that everyone got supposed to be used to spend $ on things so that businesses have money and then they can pay their employees, etc? The way I see it so far is like a huge chain reaction. Am I wrong? I hope the many wonderful ATOT members will be able to explain this to me.

 

[ReiAyanami]

wait for the business cycle to finish. everytime we think we defeated the business cycle, it shows up again.

 

[IGBT]

The loss of the manufacturing and IT support jobs is worrysome. The NAFTA jobs south of the boarder are gone as well..China seems to be the place manufacturers are setting up shop. The recovery may be job scarce and largely a paper gain this time around. Venture capital has become very conservative after getting burned in the .com bust...

 

[NoReMoRsE]

Supply and demand

 

[Kevin]

People need to buy more stuff. Thats why Bush keeps giving those tax rebates.

 

[ElFenix]

heres the thing: economic performance is largely a self-fulfilling prophecy. that is, if enough people think the economy is about to go in the crapper and make plans accordingly, the economy will go into the crapper. they'll slow down product orders, cut some payroll, and that sorta thing. vice versa as well, if they think its gonna go up they'll start hiring and ordering equipment. so, the best way to get the economy out of the crapper is to make people think we're coming out of it.

 

[Atrail]

It is going.
You'll start seeing it more in the 4th quarter, that is aslong as nothing (9/11,war) happens between now and then.

 

[FeathersMcGraw]

If anyone can come up with a definitive answer to this question, there's a Nobel Prize waiting to be claimed.

 

[Vic]

Originally posted by: Kevin
People need to buy more stuff. Thats why Bush keeps giving those tax rebates.

But consumer debt is already at all-time highs. People cannot afford to buy more (and if they could, should they?). The current Fed agenda of keeping interest rates low is what has worked best so far.
Now they just need to get business back in the spending mood, but that's gonna take time. There's gonna be some reorganization, some downsizing, some leaning-and-meaning, and then things will kick back into high gear.

 

[zsouthboy]

Originally posted by: ElFenix
heres the thing: economic performance is largely a self-fulfilling prophecy. that is, if enough people think the economy is about to go in the crapper and make plans accordingly, the economy will go into the crapper. they'll slow down product orders, cut some payroll, and that sorta thing. vice versa as well, if they think its gonna go up they'll start hiring and ordering equipment. so, the best way to get the economy out of the crapper is to make people think we're coming out of it.

Ding!

My thoughts EXACTLY.

CNN should just start saying, "The economy is awesome!" and it would recover immediately.

 

[dafatha00]

Consumer confidence.

 

[Isla]

Well, I am doing my part by keeping shoe sales going strong!

<---went on a binge and bought two pairs of Born and one Doc Martens this week, on clearance of course.

 

[43st]

happy thoughts + jobs + money = good economy = inflation = less money (value) = poor economy = unhappy thoughts.

 

[ReiAyanami]

our declining IT jobs will be replaced by rising biotech jobs. our economy will simply evolve. just like a few years ago, SBC had to shell out $200 to have an installer go to your home, waste your time, and "install a DSL line" which is pretty much just slapping on a few filters here and there, a job they realized most home users could do themselves.

 

[PlatinumGold]

Econonomies are NEVER perfect. the definition of ECONOMICS is the study of the distribution of LIMITED RESOURCES. IF resources were UNLIMITED and there was COMPLETELY free access to these resources than there would be NO need for the study of economics.

SO any examination of ANY economy will always turn up negatives or things that could be changed or things that could be done better. Examples of such DO not show a poor economy but just show that resources are limited.

having said that, the US economy is weak at the moment, but to say "I was wondering what makes our economy so crappy? shows a certain level of ignorance.

Our economy has been MUCH worse at times than it is right now. overall signs show a possible recovery right around the corner. IF it hadn't been for the 9/11 incident it could be argued that we would have had the SOFT landing that so many economists had dreamed about for years.

HOWEVER, look at things right now, unemployment, interest rates, consumer spending, productivity . . . compared to where those things were during our recessions in the '70's or the '80's (i'm not old enough to remember before that) and you'll clearly see that things are not ANYWHERE NEAR as bad as they were then. considering the SHOCKS this economy has endured during the last 4 years, i'd say that we are in VERY good shape.

 

[TommyVercetti]

From what I have heard, the economy was constantly like (Like it is now) this during the 70's and early 80's. Is this true?

 

[Vic]

Originally posted by: TommyVercetti
From what I have heard, the economy was constantly like (Like it is now) this during the 70's and early 80's. Is this true?

Actually no. The economy is much better now than it was then. Unemployment was higher, gas prices were (adjusted for inflation) higher, interest rates were sky-high then, and inflation was also sky-high. The other issues then were the energy crises, a relatively stagnant stock market, and relatively stagnant (and occassionally declining) home values.

 

[PlatinumGold]

Originally posted by: TommyVercetti
From what I have heard, the economy was constantly like (Like it is now) this during the 70's and early 80's. Is this true?

during the 70's we had 18% interest rates and double digit unemployment. during the 80's unemployment was significantly worse than it is now among other things.