To: tanknetter
“The problem isn’t that companies and people aren’t spending. That’s just the symptom. “
Anyone that spends for the purpose of spending needs to be locked up for life!
47 posted on
09/04/2010 12:11:43 PM PDT by
dalereed
To: dalereed
Anyone that spends for the purpose of spending needs to be locked up for life!
Very few people and companies spend for the sake of spending. What they do is spend for the sake of having and in a consumer/market-based economy like the US's that's what drives most of the real growth.
Having said that, there's also a BIG difference between necessary/required spending and discretionary spending. What's happening is that people and companies have cut way back on the discretionary side - either not buying/deferring what they really don't need to have (such as putting off buying a new car for a year or three), or buying inferior products but at a cheaper price (generic brand mac & cheese mix vs Kraft, for instance).
If you look at the big "bumps" in the economy, they have been driven by one-time/limited time government incentives to buy "want to haves" (rather than "need to haves") now. Cash for Clunkers and the New Home Credit being the examples.
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