Financial Cookie Jar

As a real estate agent I am ever concerned about the struggling economy that has the housing market in shambles.  While the poor state of the economy is old news that no one wants to hear about, recent indications of an upswing seem to be light at the end of the tunnel.  However, such indications beg the question, “How close are we really to the end of the recession?”

I view the economy as a living and breathing organism, something that can be compared to a person.  When someone gets sick, with the flu for example, they suffer many symptoms: fatigue, fever, cough, body aches, chills, etc.  As the flu runs its course all you can do to recover is rest, eat well, and stay hydrated.  Similar to a person with the flu, the economy has suffered fatigue, fever, chills, etc.  The only way the way the economy is going to recover is with time, rest, and care.  You can’t put a band-aid on an infection (i.e. cash for clunkers, home buyers tax credit) and expect it to heal properly.  It just doesn’t work that way.

So how do we know when the economy is healthy again?  First, its fever will break.  Consumer confidence will start to come back.  Oil prices and the job market will stabilize. Then its energy will come back.  Takeovers will accelerate, the unemployment rate will drop, and the IPO market will stabilize. Third, the cough will disappear and it will be business as usual.  Retail sales will balance and the travel and tourism industry will come back.  People will crack open their wallets and money will cycle through the economy.  In short, there is no quick fix.  However, the end is in sight and the economy will soon be on its way up.