I’ve been getting frustrated with the media. I use the term loosely of course, the “media” is every venue which preaches any “world is coming to an end” horror story. I have become incredibly optimistic about the future. Reasons for this:
1. Non financial companies are doing quite well. Just as any person would, they kept a nice chunk of cash that they were sitting on to prepare for then worst of times–almost two trillion worth…they were anticipating world demolition and it didn’t happen, and no one wants to to sit on idle money because idle money doesn’t grow. I don’t even want to think about how much money apple is sitting in right now.
2. Active money has a chance of growing, so what they want to do is work their money somehow. They want to invest it. In another company, in a child company, in a newer idea, in a better idea, whatever. I believe in innovation because it happens every day. How many people are buying tablets? How many more people are buying smartphones, apps, e-books, 3d printers?? There may not be that many buying 3d printers, but maybe next year there will! What new things will we have next year? Thousands. Who is going to make them? Design them? Formulate a network of people to execute them?
3. Stocks are being bought back. They’re starting to because it’s beaming somewhat clear there has been speculative manipulation. I guess all speculation is a manipulation, but, anyhow, stock prices are low. They’re low because people are too scared to buy stocks, they’re too scared to because they have thousands of inputs daily telling them not to. Or at least telling them that if they do, they may not see that money again because in the future, money won’t exist. We will return to bartering in a post apocalyptic wasteland.
4. Also, companies realized that they can do a lot more with less employees now, they’ve actually experienced growth! Profits! Salary packages are getting competitive so instead of hiring people just because they went to college, they take their potential investments (you, me) out for a test drive. Temp to perm jobs have risen, as they should. I had the pleasure of being on a college campus recently, dropping my brother off for his first semester of freshman year. It’s scary. Why? A lot of people go to college. And not everyone is as smart or useful as they think they are. Fact.
5. Also? QE2. Stimulus money… Or credit…I’ve been hearing a lot about it ending and how it hasn’t done much. Well yeah because an economic stimulus isn’t magic. It doesn’t just happen. There’s a lag time because like everything, it has to go through it’s own natural funneling system. Theres a 6-12 month lag time. Thats $600 billion. It’s a lot of money! It was introduced November of last year, therefore we are just now starting to see it’s effects beginning. I’m including a timeline for your convenience. It’s $600 billion but it isn’t… It’s a lot more than that because of the multiplier effect. That $600 billion will be brought in, then people, the economy, will take that 600 and use it again, and again, and again. The multiplier effect reaches as high as 8-10 times the original amount. That’s a life jolt right into our world… Quite literally.
It’s all very exciting.
