Taking the Deep Breath: Accepting the Financial Meltdown and Moving On
There has been a lot of coverage about the panic of the financial meltdown, and how panic continues to drive more panic. Â It seems that the Media found their big story, and they are milking it for all it is worth. Â Perhaps we should be grateful, after all the content of the media is no longer being driven by political campaigns. Â Honestly, I'm not sure the political campaigns really know what to do, judging by the reactions of the candidates during the meltdown. Â Regardless, there is a very real problem going on within the world economy. Â Credit is drying up, or banks are fostering a crazy belief that raising interest rates will actually benefit them more in the long run then keeping lower interest rates. Â I've never really understood that, outside of the idea that banks expect you to default on the loan and want to soak you for everything they can before that happens. Â At any rate, the end result is that no one is borrowing money, either because they can't or because it's too cost-prohibitive. Â For corporations, this means less liquid capital to work with as Corporate paper is no longer good for 24-hour short term loans. Â Therefore they have trouble with their day to day operations, which leads the market to believe that all businesses going bust, and so leads to massive stock sell-offs. Â The spiral continues to pull us down into the abyss where nothing is solid, all is black, and people are jumping out of windows. Â But let's take a step back, and a deep breath. Â Is life really so glum? Â I'm looking at sections of the economy with which I am concerned to determine whether or not it's time to start investing in apples to sell at 5 cents a piece:1. Â Retirement: Â A lot of people have their nest eggs invested in the stock market, particularly through a 401k. Â These have been tanking. Â The same thing happened to me during the beginning of this decade when the .com bubble burst. Â I lost thousands in stock value, and it took 10 years for it to come back. Â Luckily, I'm not concerned with this too much because I have another 3 decades before I think about retiring. Â That gives the economy plenty of time to come back, and it will. Â But I do feel for those who have retired or were just about to retire and now do not have the funds necessary do to so. Â 2. Â Debt. Â Everyone has debt, more than we want and many of Americans have more debt then they can afford (which started this mess in the first place). Â Debt in and of itself is not necessarily bad, as long as you know where that debt is placed. Â 3. Â Savings. Â My savings are well below the $100,000.00 FDIC insured level, so I'm not concerned here. Â What does concern me is savings for those businesses that fund their employees to come to my classes. Â With little liquid funds to pay for training, training suffers a cut. Â I love the proposal made by both campaigns and whole-heartedly endorsed by the FDIC to raise the insurance level to a higher amount. Â Of course, beyond proposing it a week ago, I haven't heard of any progress.4. Â Jobs. Â Most businesses are still running rather well, though they may be in a credit crunch. Â Unless you are worried about a lay-off, you should be fine. Â If you are concerned about your job (and many are), check with a supervisor, or better yet someone higher up. Â Test that "open door" policy and see if they are willing to talk openly and honestly with you. Â Perhaps it's a good time to update your resume, if for nothing else than to keep it up to date. Â But don't do it at work (or tell anyone). Â You don't want to start a panic within the company. Â So those are the four main concerns that I have regarding my own personal economy. Â Sure some products will become too expensive to purchase, but as long as the essentials are covered I'm not concerned. Â While it may feel like it based on world-wide coverage of the market meltdown, the world isn't coming to an end. Â Supermarkets are still open, clothes can still be purchased, and we can all still go back to work. Â So perhaps we as a nation just need to take a deep breath, take stock of what is going down hill and what you can control. Â That's going to be the only way I can see of surviving this mess.