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Nov 10, 2001 Economists are calling our current economic downturn "a normal recession." Meanwhile, 450,000 people lost their jobs in October, the Federal Reserve has dropped a key interest rate to its lowest point in 40 years and will consider another reduction next month, and Congress and the president are wrangling over an economic stimulus package of between $66 billion and $100 billion. What does it all mean to someone in Montezuma County, Colo.? One of the factors driving this recession is business spending, and that’s why the president wants a stimulus package that will benefit business. In that sense, any recovery brought about by those actions will take a good long while to trickle down to those of us who spend most of our paychecks on housing, car payments and groceries. New mortgages and car loans will be offered at lower rates, if we can qualify for them, but that won’t offset the costs of a lost job or of those same lower interest rates on investment income. The Democrats package offers more for individuals, but that, n the long run, isn’t enough to reverse the downward economic trend. Christmas and snow season both are coming, and they may tell the tale. Most retailers had placed their Christmas orders before Sept. 11. If consumer confidence in the economy wanes further, response to Christmas offerings may not be sufficient to keep all retailers afloat. That’s one reason Bush is urging Americans to go on with business — and spending — as usual: The consequences of not doing so could perpetuate the downward spiral. In Colorado, snow may save us. Airline travel has proven safe for two months straight, and a winter of champagne powder could go a long way toward mitigating the regional effects of the recession. Skier visits have been edging downward, and if resorts budgeted conservatively for this season, they may be able to keep most of their people employed, which in turn will contribute to local economies. This recession is no worse than the one we experienced a decade ago, experts are assuring us. Locally, if we take the savings we’re accruing on energy and big-ticket interest and reinvest that money, we may begin to see an obvious upturn by this time next year. Recovery, like recession, is very likely to be a self-fulfilling prophecy. |
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Copyright © 2001 the Cortez
Journal. All rights reserved. |
