You see, recessions have something good too. They remind us, that our industrialized world average consumption style is not sustainable. We get more cautious with the grip at our own wallet, perhaps we think twice before we spend $10, do we really need this stuff?
I think, all this is very healthy. Yet, the saving is a dilemma, as recently pointed out,
American businesses have become so dependent on consumer spending that any pullback sends ripples through the economy. (NYT)
We spend what we don’t have. Our credit card debts soar, increasing fear for the next blowup in the economy – the US credit card bubble. China, obviously happy to sustain the consumption, buys foreign debt, right now perhaps with less appetite. The environment is, rightly so, unhappy with the story of stuff.
Now, I think, there is another problem: GDP, the value of all the goods and services sold to households, the measure of an economy’s economic performance. As far as I understand it, saving means less spending and selling which should negatively affect the GDP – the more frequently a dollar is transferred from hand to hand the higher the GDP. I don’t think a contracting GDP is in the (political) best interests of the countries with the most powerful economies, w.r.t. GDP. We need to be fast growing, retain our top ranked GDP, in order to be leaders, to dictate the rules of democracy, the acceptable beliefs and world views.
As some put it, we are living in a zombieconomy. But hey, not everything is brain-dead bad. The sun is shining again today, linden pollen is suspended in the air like the most soften snow crystals, and some of the sad memories I wasn’t able to leave behind me during my last take off from the new continent are starting to float away like linden pollen: légère, gracieux et distant.