By all accounts, people should be panicking by now because of what they read and hear on the news. It’s gloom fest wherever you turn. The housing market keeps on spiraling; the immediate future does not look good. The retail scene is pretty soft; consumers are careful and they are only buying the bare necessities. The dollar is weak globally. The job market looks bleak as it is highly competitive; unemployment is rising. Gas is going up, way, way up!

Recession in the United States is almost a given, you say. Or is it? The numbers are staggering as well as quite confusing and unnerving for a non-number person like me. The optimists do forecast slower growth but no recession.

However, here are a few numbers to consider –

Unemployment rate will rise to 5.5 percent by the end of this year;

Oil prices closed at a staggering high of $105.47 a barrel last week;

Confidence in the economy dropped to a low 33.1 mark in early March compared to 48.5 last month;

Lower home values and bad mortgages result in more bankruptcies

In such uncertain times here in the United States, it is easy for one to pull a Chicken Little, “the sky is falling, the sky is falling!” There are wrangled nerves definitely. Apprehension looms thick in the air. A sense of doom is inevitable as people wait and see what happens next. 

With spring fast approaching, travel plans will soon be hatched out. But with gas prices skyrocketing faster than you can say four dollars, it sure is a rude awakening to be paying over fifty bucks every time you fill up. Does one travel more than 10 miles or do you drive around the neighborhood? Flying might be out of the question as airlines poised themselves to jack up fare prices.

But really, this dark economic cloud might be looming for a while but it’s pretty much business as usual around here. No rallies, no outcry to impeach Bush, no flag burning, no taking to the streets, no publicity stunts from politicians, no photo op showing physical solidarity between the masses and the clergy. Instead the government rolls up their sleeves and gets to work.

We watched as the Federal Reserve sprint into action. They made available a rescue package of over $200 billion to help strapped banks and investment houses resulting in a huge one-day gain for the Dow Jones last Tuesday. They created the new Term Securities Lending Facility for financial institutions to avail of 28-day loans of Treasury securities instead of overnight loans. They have lowered the interest rates on a few occasions to enliven the buying power of consumers.

The U.S. government in turn passed the Economic Stimulus Act of 2008. This new law entitles taxpayers a payment of $600 for those who filed as single or $1200 for married couples who filed jointly. Over 130 million American households will start to see their checks sometime in May.

The tax relief will act as a short-term boost to counteract the obvious signs of an economy that is seemingly heading towards recession. Although the tax rebate comes out to a staggering $145 billion, experts believe that this is a shot in the arm that will turn things around.

The U.S. government encourages people to spend this money any way they want; at the gas pump, pay utility bills, buy food, pay credit cards or on shoes. They don’t care for as long as you spend it. The bottom line is the economy will be back to where it needs to be, or close, if people spend again.

The stark reality however is quite a hard pill to swallow. The mighty dollar does not stretch as far as it used to. The gas hike affects everything basic that our daily lives subject us to—electricity, natural gas, dairy products, water, food, etc. Things are changing and I am sure the effect rings true everywhere as well. Gasoline is gasoline and because of countries like India and China, we are definitely feeling the pinch on a global scale.

Although I opt to be informed when it comes to living in the midst of an economic crisis, I am no economist. What I am is an optimist, a hard core, no balking down optimist. What I see is a unified effort on the part of the United States government and the people entrusted to make the right and smart decisions to preempt any catastrophic economic crisis.

In times when my footing tends to be quite shaky, I turn to a few folks at work. These are knowledgeable and smart guys who I go to every time I want to hear an interesting perspective. I asked a very simple question, are you worried about the economy? Their answer is no in a nutshell. “This too shall pass,” they tell me. “In the 70’s when gasoline was rationed, we lined up for hours to wait for our turn to pump gas in our car,” one of them added. “Just like those days, this too will be over and things will be back to normal again,” he told me with confidence. Maybe normal with a slight twist.

Well, who’s to say that it will be otherwise then? Coming from a true-blooded American, an optimist like me cannot agree more. They’re not worried, why should I be!

Till next time…spend time to reach out to the less fortunate ones. Kind words will go a long way!!!

 

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