Global Economic Impact

The chairman of Sony once said in a magazine interview “The U.S. is so prosperous because you take what people in other countries consider a luxury and make them a necessity”. The United States has adhered to this idea for decades and prospered beyond what most people could dream. Unfortunately there has been major financial decisions made by the leadership of the nation, and many corporate executives that have been motivated by greed, and suddenly the world is starting to see the fruit of these destructive decisions.

Some economists began questioning the overall viability of the U.S. economy as compared to several emerging countries. China, India, and Brazil are usually mentioned in any global economic discussions. Experts clamored that the U.S. was falling behind and would someday be an afterthought to the emerging nations. If this is factual, the period of history we are living in will be extremely turbulent.

When the economy of the States began to wane in late 2008 and Americans stopped traveling and spending money, what do you suppose happened? The rest of the world followed the United States’ lead and a U.S. crisis became a worldwide crisis. As much as everyone hates to admit, the United States’ economy continues to stir the world’s economy.

America must be alert to troubling changes on its’ economic horizons. If the U.S. continues punishing people for creating jobs and increasing profits; if motivations are for greed and selfishness, they will become an afterthought to other countries. China and India face the problem of not sharing the wealth with all their people, regardless of social status. The European Union follows the path of bigger government and social engineering concepts that don’t reward individuals but rather, support the collective good. The United States’ current federal and state tax policies seem more aligned with the E.U. approach and less toward individual achievement.

America has been a forerunner of new technologies and ideas, and has praised people who make something of themselves. The U.S. must tackle the problem of corporate greed and correct it without penalizing the small business owner, entrepreneur, or wage earner. If only the United States was one nation UNDER GOD when it came to its’ principles in business and economic decisions, then the economic State of the nation and in turn the world, would be on the rise instead of the decline. For those who wait (hope, trust, expect) on the Lord shall renew their strength. They will mount up with wings like eagles. They will run and not grow weary. They will walk and not faint (IS 40:31).

Dollars & Sense

The last couple years have put a considerable strain on everyone, regardless of their social status.  Since October 2008 the Wall Street Journal and other publications have lamented at the trillions of dollars lost by the sudden change in the stock and bond markets.  While this is true in economic theory, the facts are quite different.

When you invest in your 401K or buy individual stocks, an assigned value is given to each share or unit you own in your portfolio.  Prices in the markets change daily. Although fluctuations can be the norm, the truth is unless you trade out your shares, you have incurred no change to your original purchase.  In normal times, your value would return and may even rise above your original purchase price within 9-12 months.  However we are not in normal financial times.

The United States is witnessing events that have not been seen in over 80 years. The government has increased involvement in the banking and car manufacturing industries that has never occurred before this time period.  GM has, and Chrysler is about to file for bankruptcy protection, with the government being the driving force behind the process.  A government in dire need of bankruptcy protection itself is not the first choice of most people to take over manufacturing, banking or any free enterprise.

Financial experts predict the economy to begin turning around the last six months of 2009.  Construction starts for housing and commercial projects will be extremely critical to making this prediction a fact.  The current financial crisis impacts everyone differently and depending on the industry or area of the country you live in, the impact ranges from “dire” to “what crisis?”.  If you find yourself in the former category here are some quick steps you can take to help you handle the situation.

Start by reviewing your annual and monthly expenses.  If you don’t have a budget, create one today and be sure to include your spouse and children.  In my household growing up, my mom ran the budget process and I would stack her up against any financial guru on how to stretch a buck and get the best buy on all purchases. The reason she could do that, there was no other choice or option.  Credit cards were non-existent and all you had at your disposal was what the wage earner brought home.  When you start your budget process, remember it is ok to say “no” or “not at this particular time.”

Develop a reasonable budget and stick to what you need to do during these times.  If you slip one week, don’t panic.  Look ahead and see what you can do over the next several weeks to get back on your plan.  If you have a good week and spend all you thought you would, put half into a savings account and take the other half and treat the family (depending on the amount you may want to put all in savings).  If you continue for several weeks being over or under budget, re-examine your original plan and either save the difference, or you may need to determine how to increase your income temporarily to cover any shortfall.

Most Importantly, pray and ask God for guidance on what you should do.  If you are a Christian you should know that tithing is a part of your budget. If you’re not a Christian, tithing is a topic to be discussed at a later date.  No matter where you are in your walk with God, He is always faithful and he will never put anyone in a situation they can’t handle.  Prayer is the base foundation for every Chrisitian’s life and God answers prayer requests every minute of every day, we just have to be alert to his voice and respond to His will.