Major Structural Changes to the U.S. Economy are Needed for a Long Term Recovery
Read More: Originally submitted at Corporate Professionals and the Global Economy.
The only long term cure for our economic downturn are major structural changes in the economy.
I can just hear the laughter by the economists in the President Obama administration. “What are you talking about? The economy is already recovering,” they say.
Just look at the stock market. Euphoria is all over Wall Street. Last week, the Dow Jones Industrial Average closed over 10,000, the first time it has been at that level since the market crashed.
Goldman Sachs and J.P. Morgan are reporting record earnings. IBM’s earnings exceeded those expected by Wall Street pundits. The earnings of many other companies have been better than expected. 
Many corporate professionals in our country are paying close attention to a potential economic recovery.
Many feel insecure in their jobs and would love to see a strong recovery bring stability to their work place.
Others are like me just a few years ago. They want to retire but can’t afford to. The stock market crash last year and the decline in home values have reduced the money they expected to have available for retirement.
Others are moms and dads who want to work from home. They want to spend more time with their children.
For all these people, I think it is important to understand what is happening in our economy. It’s important to have a Plan B, a job backup plan, in case the economy continues to falter. For me, it was a work from home online business that allowed me to retire from corporate America after 25 years as a Chief Financial Officer.
My job backup plan was to obtain the best internet marketing training. I was able to find online training at a very reasonable cost and continue working in my regular job until I was ready to make the move.
You may not want to go that route. The important thing is to have a Plan B. I feel that we are a long way from recovery. When it comes, it will be a very slow process.
The current recession (19 months as of June, 2009) is the longest economic downturn since the Great Depression (43 months).
Unemployment numbers and industrial production are at the worst levels since 1945. Retail sales and housing starts, although slightly improved in the last few months, are worst than any time since the Depression.
Our ailing economy cannot be cured by more stimulus. Stimulus is exactly what caused our present problems.
So what is the cure? What are the structural changes in the economy that are needed to achieve a valid, long term recovery? Well, it’s not pretty.
Unfortunately, the cure for our economy is bankruptcies, foreclosures, defaults, workouts, and deflation. Because of the massive spending on economic stimulus and bailout plans, we will most likely deal with hyperinflation at some point.
These structural changes in our economy won’t happen quickly. Corporations don’t want to go under. Individuals and families don’t want to lose their homes.
However, the longer the federal government tries to prop up these failing corporations and families, the longer this cure and the structural changes in the economy will take.
The federal government and individuals have accumulated more debt by far than at any time in our history. It will take a long time for this debt to unwind.
It took decades to build up this massive debt. It is naïve to think that a few months of pain and stimulus spending is all that it takes to cure our problems.
The federal government believes that stimulus and bailouts are the answers to our financial problems. They are Wrong. 
It’s frightening when the second most powerful person in the country, Vice President Joe Biden, makes the very “wise” statement, “We have to spend money to keep from going broke.”
You need to consider that “sage” advice as you try to meet your personal financial obligations each month.
Scott Hubbard has retired from 25 years as a Chief Financial Officer in Corporate America. He now teaches corporate professionals and network marketers how to start a successful internet marketing business. You can learn more about Scott by visiting his blog at http://YourGuideToRetirement.com .
You can reach him toll-free at 877-878-4036 or by email at Scott@ScottHubbard-Consulting.com. His primary business, http://Your-Guide-To-Wealth.com , provides the general guidance that individuals need to make good financial decisions in economic downturns as well as in expanding markets.
Views: 469 | 
Comments: 13 
Advice From One Who Knows
In my experience, just because those that rule our countries tell us something is so, does not necessarily make it so.
With the economy such as it is, many more people are turning to the internet for answers. But online marketing training is crucial or one is throwing good money after bad.
It is "sage" advice from people like Scott that will keep you on track and empowered.
A Plan B
Hi Scott,
This sure does paint a bleak picture. Fortunately, there is a way out. Thank you for pointing to that. If not for a plan B, many people would otherwise be in dire straights.
Working at home is a great plan B, but being sure to get the correct training is vital to finding success in that chosen business. You mentioned a great training resource. Thanks.
Michelle
Not Sure Who the Sage Is.
Well said Scott, I'm not sure who the sage is here. You or Vice President Joe Biden. Seems to me, the grassroots common sense rules on this one.
You got it right
Scott
One of the integral parts of us getting out of this recession is job creation and the government needs to create the environment that encourages businesses to prosper and provide these jobs rather than try to employ everyone with make work jobs that don't last.
What a great idea to develop that plan B that will get you the training and know-how to start and succeed in your own business. This does not mean the get rich quick, overnight success plan you often hear about, but rather the slow, steady growth plan that will take you where you want to be even if the economy is slow in coming back.
You ought to run for office...
Scott,
I'm so on board with your assessment here. We need people in office who have the same common sense approach to the way they legislate.
It is wise to be reliant on ourselves for success and not someone else by getting the necessary training.
I feel that your are right on
Hi Scott,
What you are saying here is so right on for me. Recently I read an article that if and when the government does decide to pull out we will see more bank closures, foreclosures etc. I truly believe that if we had allowed some of the markets to adjust themselves we would be better off today.
But, time will only tell...won't it
Having plan B is always the best Plan..
U.S. Economy
Can we really trust those who caused this problem to get us out of it? Plan B is to get control of our own economic future, many are turning to having their own business - in one form or another.
David everyone need a plan
David everyone need a plan B. We can't depend on the government to make life better for us. Those who lost their job, and their home didn't have a plan B, and those still working better get one quickly.
They only way one can hope to have financial security is be in business for them self.
World Economic Recovery Needed.
Powerful thoughts and comments Scott and thanks for making them and making us sit up and take notice. A bleak outlook indeed but only if we don't take head, change our mindset and look for alternatives.
Many of us have had the benefit of the good and bountiful years. If we care enough for our families and fellow men then we can turn this dilemma round, learn our lessons and then move forward.
What legacy is our generation going to leave to posterity?
I feel we nedd plan B and plan C these days.
When Plan A Evaporates
You are so right, Scott. As someone who has been involved in the housing industry for the last 18 years (and been effected by it, big time), I can tell you the answer isn't in throwing more money after the problem. Having a Plan B and creating new money coming into your household is the only chance for financial stability there is. Thankfully we can create our Plan B with the skills we've learned at Renegade University. Thanks for your insight and expertise.
Hey Scott, the next election's only a couple of years away. If you run, you've got my vote :-)
It Amazes me...
That the leaders of our government are no smarter than the average Joe Blow. It never did make sense to me to spend more money to get out of this recession. It seems people need to spend less, save more, and start living within their means.
A False Since Of Security
When is our government going to realize that the U.S. economy has to evolve to keep up with world wide changes that are taking place globally. From our economy to our school system, health care we have yet to evolve to meet current global challenges.
Scott thank you for bringing this important issue to our attention, and yes you're absolutely correct "The only long term cure for our economic downturn are major structural changes in the economy"
What amazes me is how the American public continues to stand on the sidelines and watch as a few people decide the fate of an economic future that will impact generations to come.
We should all be sending letters, making phone calls, sending e-mails what ever it takes to get our government officials attention, remember we voted these people in office they work for US. In the mean time I hope you have a plan B, because as Scott says it took years for this economy to get were it is today and it will take years to correct it.
What is debt anyway??
Thanks Scott for this elevating insight. Everyone beliefs what they believe ..I for one think that with structural changes I would also include the abandonment of the fractional and unconstitutional Federal Reserve Banking system. Some people may argue that this is only going to create anarchy (like Ben Bernanke)... but if you look at the facts and how the debt has been created you actually should be outraged about it..and even the bailouts to these filthy rich bankers of even more taxpayers money to so called "saving the economy" should make everyone stand up and replace the whole corrupt and lobbied system, cause Government is there for and by the people..this has grown totally and insanely out of control.
Google for "how money is created" and learn about this mobster kind of crime!!