Companies Are Liquidating; Homeowners Are Mailing In The Keys. Have We Given Up?
The article begins by articulating the current happenings in the American economy. A big-city store trading in electrical items has just given up and 34,000 people will lose their jobs as this company, circuit city stores, closes shop. The store tried to use chapter 11 to salvage themselves out of the current financial problems but they realized it is not possible. The article argues that most companies whom owners and managers are going under because have realized that they cannot fight on and win the war. This happens despite the Obama Administration promising a stimulus package that will boost the economy.
The stocks of various companies have gone far below in the last 12 months. Many jobs have been lost and this is very dangerous for the American economy. However, the government is pessimistic that the sector will improve. The article has given an example of John Rockefeller, who continued to invest in 1929 after the market crashed and this gave him a quite amount of wealth that he a must. The article proposes that the Obama government will do something good if they avoid Bush’s administration failures. When they failed to cushion the economy in 2007 when there was an indication that the American economy was heading south. The article argues that the similar package that’s promised by the Obama administration is a traditional measure to reduce economic distress and create confidence among citizens. This stimulus has been used to help many institutions which could have gone under the Federal Reserve. According to the article if the federal has taken this measure a little bit earlier then a number of liquidations could have been avoided and salvage this liquidation.
Opinion
The article as represented by the writer is good and discusses how the American institutions have taken the current financial crisis. The writer of the article has tried to summarize the current happenings in the American economy and equate it with President Obama’s speech. In my opinion, the writer is correct in the way he has analyzed the situation and the current financial crisis that has affected the American economy. The stimulus package that is being used is an effective tool to caution companies from going under and saving thousands of Americans from unemployment. If Bush had begun this activity earlier he could have saved the American people the current problem that Americans are facing. What the writer has just stated indicates that in order to revamp the American economy quite a colossal amount of money needs to be put into the system to cushion the effects of the economic crisis to save American jobs. Otherwise, the current amount that has been put into the system will be peanuts and will not help the economy grow.
Economic principles
The economic principles that have been covered in this case include: depression which is a result of inflationary tendencies, the effect of unemployment in the economy and how unemployment is taking a toll in the United States. It also takes consumption as well as the value of money. The stimulus package in the article talks about controls that are being used in controlling the economic activity of a country. The loosing of jobs is employment and unemployment principles that are being discussed.
References
Gross D. (2009): The Quitter Economy companies ARE liquidating homeowners are mailing in the keys. have we given up?