Question from a reader, “Kim, I am scared ***less about the future. Any thoughts to calm my nerves?”
My answer is that business always as an element of fear about it – a fear of the unknown, a fear of lack of control and a fear of course of losing money. Pundits and the wealthy always say that the people who make money are the ones that are willing to take risks. That is true in some cases. Pundits and the frugal also say that patience and time are the safe ways to accumulate a fortune without large amounts of risk. That is also true in some cases.
In our current situation, we are definitely in a case of the unknown about the future. One one hand we have a lot of us unemployed and it looks very tough to them to look to the future to try and get a job. Their fear is very real and justified that they may not have enough money to pay their bills. The best way to calm their nerves down is to get them employed. And as fast as possible!
The Congressional and Treasury money releases and stimulus packages are slow moving changes that probably aren’t going to work fast enough to get a lot of people back to work. That is something to be scared of.
Now for some things that you don’t have to be scared of and then back to some things that you can be scared of.
There will be either a dead cat bounce in the economy or some sort of programs to get people working. There is a major drive to get business moving inside the United States. Why do we want it do get moving here some fearful European or Asian friends may ask? Because we are still the world’s largest economy of consumers. Sure, India and China want to step up. So does Russia but the US is still the big dog in spending money. Now in order for Americans to spend money, they need to have an income stream and that means they need to get back to work.
There are lots of job postings on the Internet but they are for very special skillsets or something that one has to retrain for or take a paycut to move into. Situations like this have happened in the last Great Depression (I guess this makes this the New Great Depression) and people will have to retrain and hustle to get work. Jobs will be opening up though probably as I stated before not as fast as people will want. People are already splitting their families with one spouse working the Midwest and the other working in California or New York. It makes for multi-state tax returns with varying degrees of complexity (by the way I do multi-state tax returns if anybody needs them done).
The American people – that is all of us of all nationalities, skills, race, creed, color and religion – are versatile and flexible. Something is going to happen to get people going again because the alternative is that we will be in a 16th to 18th Century environment of things falling into total disrepair in the infrastructure and people living like it is the Wild West.
There will be inflation and that is something that scares me. We have trillions of dollars being introduced into the economy and our government is smart enough to know that we will have to sooner or later start jacking up interest rates to attract investment back in the country’s dollar. We will be in a scary position with inflation coming back and a lot of people slowly getting back to work but finding that their dollars aren’t buying as much as they use to.
People now are in a Depression mode in terms of money. Everybody who is out of work is saving and cutting costs where they can. There are always people who don’t get the message until their credit cards are maxed out and cancelled but there are others who are cutting back. That is evident in some sales figures dropping (though it looks from government statistics that people must be spending their Federal IRS check refunds or something because we are seeing some spending going on).
Things that you should be afraid of (see, I am going back on topic) are that our dollar may become worthless and everybody’s savings may become moot. Other things to be afraid of are losing one’s health. It is true what your parents (well, Mom at any rate) use to say: Without your health you have nothing.
I will take this opportunity to talk about a few things that are scaring me as well. The In Home Support Services for the State of California is being cut as well as threats to special needs care. Please write your Congressional leaders and the Governor and tell them that this is just plain wrong. People who are caring for special needs in their house are taking care of their relatives and loved ones who would cost the State of California twice as much money at least to take care of. If the State is trying to throw them out with the bathwater, that is scaring me because taking care of people who can’t take care of themselves is an integral part of the American and Californian way of life.
Note I am not talking about bastards who abuse the health or social system. I am talking about the people who are trying to live and function in daily lives as part of society. They work and consume just like we do. They help keep the local, state, national and international economies going. Big picture people.
Some closing thoughts to dovetail with the above information – if you want to calm your nerves, do an inexpensive hobby to relax. Learn to meditate or dance (or both) and add some years to your life. It is only money. The food, shelter and clothing is what is important and do what you can to keep the items that you need for basic life support.
Hug and kiss your loved ones and find the courage and strength to go on through them. You will be surprised but as the old saing goes, if you take ten steps towards God (or the Universe or whatever you call it), the Universe seems to take one hundred steps towards you!
To all of my readers I wish you peace, happiness, wealth and good health.
March 30 2009
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Kim Isaac Greenblatt
Business, Money and Fear