Comments on: Opposing Views: How Quickly Will the Economy Recover?

By: arthur

arthur — Sat, 17 Jan 2009 11:45:09 +0000

You’ve got the right idea. The economy is so unpredictable. Everyone acts in what htey think is their own interest without it being clear whether its actually good for them. We never really know what hte future holds for our economy and economists are always scrambling to create a model for what just happened, not what is going to happen. We should just hope that things get better, and make sure we save wisely but also invest and hold on to our investments in bad times, so we dont cause things to sink further

By: Jessica

Jessica — Fri, 16 Jan 2009 17:22:54 +0000

With all due respect Jason, I think your analysis is flawed. First off, the dollar actually isn’t inflating, its actually going up in value compared to pretty much all currency except the Yen which is currently experiencing massive deflation. So there is no reason to believe people aren’t buying for that reason.

Also, the theory works insofar as people can continue to make money. Businesses may lay people off, but I think as the next month or so goes on, we will see a lot more money coming back to people from the government and lets be honest, people aren’t great at saving. If people start to use their stimulus checks, companies will have to hire more and more people to make more and more products. this seems like it would help bolster our economy.

By: Brett

Brett — Thu, 15 Jan 2009 22:46:22 +0000

I doubt very much if either theory is completely correct. Instead I posit that parts of the economy will hold true for each theory. Some sectors of our economy can follow a very sharp trend such as the v theory. Consumer products especially and other things which are based mostly upon business confidence can potentially rebound very fast. The lending and credit crisis however will take a long time to rebuild simply due to the nature of that industry. Either way it is safe to say that we will be on thin ice for a while, and that the economy as a whole may never be completely returned to its former state.

By: Bruce

Bruce — Thu, 15 Jan 2009 22:39:28 +0000

It is the nature of economies to fluctuate, we are simply in a small dip right now. I do believe that the “V” theory is correct. Take last summer’s gas prices as an indicator- the price for a gallon of gasoline very quickly shot through the roof, and it looked as if it would never fall. Yet come autumn the price fell back almost as quickly as it rose. Our economy along with some well targeted stimulus packages should rebound quite quickly .

By: Sam

Sam — Thu, 15 Jan 2009 22:34:14 +0000

I think that the economy will take a long time to recover completely, whatever that means. I have a feeling that once the economy does recover it may not look anything like what it did before the decline began. We are at a crossroads now facing challenges of epic proportions which require significant changes in the way we live if they are to be solved. Through technology or some other means we must find a way to sustain an economy on limited resources. These new methods and technologies (such as the trend toward sustainable and renewable energy) will take a while to implement, and our economy will not be whole again until they are.

By: Jason

Jason — Wed, 14 Jan 2009 16:47:32 +0000

I’d love to see a quick turnaround as much as anybody, but this “V” thing sounds like a very fragile economic theory. For example, it will only work if demand begins to go up. But if companies continue to lay off workers and the dollar continues to inflate, there is no reason to believe that demand for products will rise. It’s a circular theory– it says that demand will rise, but companies are producing less, meaning they are expecting lower earnings and shrinking their companies accordingly, meaning there are more layoffs and less money being made by most companies, which means demand has no reason to go up. I think the first theory in this post is a lot more likely.