Thursday, August 18, 2011

Stock Market Yo-yo

And, of course, the stock market plummeted again today. Apparently investors are worrying about the possibility of another recession. So, they are selling stocks.

Could we simply ignore what the stock market is doing and simply focus on the issue of jobs. The US economy will not contract and slip into another recession as long as business owners start hiring - or at least stop laying people off. The economy is driven by consumer demand - and consumers only spend when the have money. So, if companies committed to maintaining employment levels and maintaining wages, consumers will continue to spend. That will, very simply, stave off any contraction in the economy.

If any business owner and investor is worried about a recession, he or she can simply not contribute to the problem by not cutting jobs or wages. He can contribute to the solution by hiring back some of the nine million people laid off since 2008.


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