I've been wondering for some months now how the US financial markets can be so buoyant when the real economy (the stores, factories, and services that employ people) is in such bad shape.
Cory Doctorow, SF author and activist, has some thoughts about that.
Between mounting costs for housing, education, transport and health – a place to sleep, a path to employment, a way to get to work, the physical capacity to do your job – being alive has meant increasing your debt burden.
And now the US real economy – the wage-generating (and thus debt-servicing) economy – has ground to a halt. The finance economy continues to boom, largely on the (obviously false) premise that debts will continue to be repaid.
It's worth contrasting the US approach – the $1200/person bailout, the $6T finance bailout – with other countries that are less beholden to their finance sectors.
Canada and many EU governments simply assumed the payrolls of firms, relieving them of their major expense and providing ready cash to consumers that the can use to purchase from those retailers that remain.
His post is a response to this article from Naked Capitalism. Both are worth reading.
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