It’s a new year. It’s our nature to be hopeful. We have a whole new year with new opportunities, new resolutions, and a chance to start fresh. A new president will soon take office, with a whole new administration. Yet 2009 seems to be coming in with an awful lot of 2008 baggage.
Israel has been bombarding Hamas for the past 8 days straight. Hamas has been around since 1987 and has two stated goals; to take over the entire middle east, and to eliminate the nation of Israel. Gaza is literally located within the boundaries of Isreal. I’m not sure how well this plan was thought through. They were firing rockets into Israel before the Israeli offensive began, and have been continuing to for the entire week.
As 2008 came to a close, we were reminded that the Stock Market decreased in value by the greatest margin since the Great Depression. The final months of ’08 saw over $7 trillion worth of stock value disappear. Unemployment is up to 7%, and the number of unemployed workers is expected to rise by another 1.5 million. The disappointing Christmas season, retail wise that is, will most likely mean the closing of several businesses in the near future. GM got their $4 billion handout on Wednesday, Chrysler could get their first check by Friday.
The government bailout was all the rage during the political season, and I wrote a scriptural perspective on economic collapse at that time. In a nutshell, that post points out that Americans are still richly blessed beyond measure compared with most of the world’s populace. Over half of all people on earth live on less than $2 per day. That’s half of what I pay for a coffee from Starbucks. Americans throw away 14% of all food we pay for. From our point of view, the current economic climate is a disaster. Other nations would gladly trade places with us in a minute.
Is there perhaps an upside to all of this? Well, the price of gas is the lowest it’s been in nearly 10 years. There’s a little bit of talk of what the Israel/Hamas thing will do, but keep in mind that neither of those groups produce oil. GM is offering 0% financing on all 2008 models (and there are quite a few in stock). The government assistance has also allowed them to lower the required credit score in order to qualify for a loan. The housing market hasn’t bottomed out yet, but already some families are purchasing homes for the first time because of how low prices and mortgage rates have gone. Perhaps these are the silver linings.
I may get hung for saying this, but this “crisis” may simply be a necessary adjustment period for our economy. Even our economy cannot simply grow continuously unchecked indefinitely. Do you know what products suffered the most during this recent holiday season? Luxury items. I think that’s great. The high end retail junk (i.e. $1,200 shoes) that nobody really needs in the first place didn’t sell this season, and will now be liquidated at a fraction of the original retail price. I think history will show this is good news. Frivolous companies are being forced to become practical, and produce things people actually need at prices that normal people can afford to pay. Gas has fallen from $4 a gallon to nearly $1, which is about what I payed when I first started driving. Once exploding markets have imploded, at least in the short run. As we reorganize our economy, and the institutions that manage it, we will be better equipped for business in the future, on both the supply and demand side. Tightening the belt is hurting now, but it will pay off in the future. There is reason to be hopeful; I just hope it will be in 2009, not ’10 or ’11.