Tuesday, July 15, 2008

The fundamentals.....suck.

This is kind of an interesting time. You know that old saying the government trots out when the public is panicking? "The fundamentals are sound?"

Well, the fundamentals suck. But it seems to me that the public isn't panicking.

Or the other classic chestnut: If you can keep your head when everyone around you is panicking --- you just don't understand the situation.

I think what it most reminds me of is, that war and famine and pestilence are just over the horizon, and you suspect its coming your way, but you shrug and go about your business. What can you do about it?

People partied all weekend at the Summer Fest, Linda and I went to see some great movies, business has been good. I don't personally know anyone who has lost their job because of the "fundamentals" or been unable to sell their house. None of my customers who work in the construction trade are having trouble finding work.

Haven't I always been a great proponent of the theory of local observance? That what you see in your business and in your neighborhood is more telling that what you read in the news?

(I realize, that's a contradiction: I guess I mean, there is the mainstream news that you could read without realizing how dire things are, and there are the financial news outlets that are all but screaming, "Game over, man!")

Maybe this is a case where the mainstream media is actually doing us a service by not telling us the worse. Hell, a person watching watching Faux news channel or Rush Ditto would think the problem was that Obama has a scary middle name.

Maybe this is a case where the alphabet soup nature of economic news, the heavy jargon are obscuring the fundamental weaknesses.

Maybe this is a case where the bears have howled so often, that everyone just ignores them.

I've done what I could. Lowered my debt, hunkered down. I'm not willing to go to the extremes of growing my own food, buying a gun, burying my money in the backyard. I'm not even ready to pull out of WaMu.

I'm just watching with great interest.


Duncan McGeary said...

Spoke too soon? Bush just called the economy, "Basically sound."


RDC said...

The economy is basically sound. We are going through a correction, of a kind that we used to see every 10 years or so, but have not seen for 30 years. It is a bit more severe because of what has been done over the last 30 years to avoid the cycles. It is also a case of where the bubbles over the past 15 years has pretty much come to an end (except for the commodity bubble occuring now).

The irony of it all is that the actions you describe as getting ready should be practices that we all should be using all of the time.

The bill for the decades of consumerism, over spending, and lack of saving is now coming due.

Nothing unexpected. In the big picture nothing that has not occured before.

The Natives Are Restless said...

The "bill" for decades of lack of saving is going to be "coming due" for decades.