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12/2/10

You Can Quote Me On That

We're tinkering with the steering wheel when the engine needs repair...

All of the printing of money with Quantitative Easing, Treasury Bond purchasing, tax schemes and budget cutting, extending unemployment benefits, mortgage work-out plans, social programs, ad nauseam, cannot resolve our overall economic problems unless two underlying factors are realistically addressed:

1. High unemployment due to mismatch of the skills of many job-seekers and what employers need now and will need in the future. This requires people becoming cutting-edge skilled, free-agents and/or self-employed. Eight million jobs aren't coming back because they aren't needed any more, we should be preparing for what is and will be needed. The economy can only be stimulated with significant earned income

2.   The foreclosure and indebtedness problem of individuals, organizations and government. How the lenders reconcile what people owe and how much houses are worth and deal with uncollateralized debt and collect it, is still an open question that must be resolved, in order for any across-the-board financial restructuring to occur. If a large segment of the population has no earned income due to unemployment, how do they repay the debt?