Oct 12 2009
The Role Of Fear In This Faltering Economy
Our economy is definitely going on with some “tough times” as our President recently confirmed in a speech on the economy of the struggle today. A combination of factors has created a highly volatile stock market, housing market, inflation and cost of living is increasing, and a faltering job market, but a key component of the fall of an economy plays a role in facilitating intangible and perpetuation of economic instability.
This component is human fear. We can help, we’ve developed with fear as one of our main emotions, and the media and our surroundings have helped only later declaring “the sky if falling” with her qualifications apparently is direct doomsday. Heck, you can not read your email without seeing the titles on the side saying that we are headed for worse times before they get better, we are the costs skyrocketing, the foreclosures are at all time high, the Gas prices are astronomical, and basically everything is working against us now.
The sky looks very dim indeed if you tune in to the evening news or happens to be bombarded with all this fearful newspaper journalism in the Internet, an increasingly popular site to get the news. So, the media have become a part of our faltering economy, or is actually a combination of unfortunate factors, apparently brought on by events beyond our control? Well, most people feel the media is partly responsible for making things worse. Take for example the bag. Fear is the worst enemy of the bag. When consumer confidence in the economy is low and there are other titles that are less than favorable in the financial, retail, and finally, holding areas, the bag undergoes dramatic volatility.
In fact, one of the hardest hit and the subprime credit fiasco, which was also recently offered security by the federal government and JP Morgan, another heavy financial, Bear Stearns, recognizes the fear is it is the worst enemy. They insist that their financier0es are still intact, but the rumors were rampant about the imminent collapse of the company forced the party down to their lowest levels in nearly eleven years. Many financial institutions are experiencing nosedives in its stock price, and also have slashed dividends to preserve capital fund, a move that is said to create a domino effect where other batteries banks follow suit. This will only force prices lower in the action, and makes them harder for her, and therefore the market to recover.
Most financial analysts now agree that we are in a recession, but some are still reluctant to call that card, saying that a recession may still be avoided, and we’re just in an economic downturn. I for one, think we are smack in the middle of a recession, and I think that part of the reason for that is the fear that is spreading about the dire straits that the U.S. economy is inside, and the sense of desperation carried by these parts of doomsday. Fear perpetuates a sense of helplessness and “wait out”, as well as inspire them to move back investors their money out of stocks and other investments, and put into cash accounts, which only puts us further into recession. For those with iron stomachs, is really a great time to be an investor, as there are some good, solid companies that sell for well below their book values and their true worth today.
That’s not to say that not too many smelly things too, but if you practice due diligence in investigating their individual financier0es and balances, you can sit pretty when this recession is over and consumer confidence that is so key to the A healthy economy is back. I personally think we have a long ways until we are out of the woods, but I also believe we have the power to change things if we just practice patience and discipline as a nation collectively. Until then, it may be wise counsel to ignore the titles of doomsday and to compose your own mind about where the economy goes in this country.
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