In the end, however, there is only so much the government can borrow and so much the government can do. The only other choice is for Americans to finally put their spending in line with their incomes and their need for long-term savings. For any one household, that sounds like a good idea. But if everyone cuts back at roughly the same time, a recession is almost inevitable. That’s a bitter pill in and of itself, involving lost jobs, lower incomes and a big hit to government tax revenues. But it could be serious trouble for regional and local banks that have balance sheets loaded with loans to local developers and builders who will be hard hit by an economic downturn. Think of that, says Dugger, as the inevitable second round of this financial crisis that, alas, still lies ahead.

The fun is just beginning.

Every so often, you run into one of those opinion articles that really is spot on. If you’ve ever done any reading on technology trends, then you are no stranger to a man named John Dvorak. He’s been writing articles about technology trends since the 1980′s so he knows a thing or two about the economy and it’s affects on that sector. He writes a regular column called John Dvorak’s Second Opinion for a site called MarketWatch. I’ve always liked his columns since they provide some interesting insights into the inner workings of the tech sector. His latest column talks about the public’s eroding trust in financial institutions. To quote one of the paragraphs:

It turns out that we are looking at nothing more than pigs at the feed
trough gorging on easy money while pretending to be the public’s friend
and protector. This situation is seriously damaging the economy and
threatening the future of the economic system.

That probably sums it up as good as any. It’s all having a ripple effect. High gas prices, runaway food prices, high rates of mortgage foreclosures, failing businesses…need I go on? What makes this article stand out for me is that it doesn’t try to micro analyze individual factors. Instead it takes on the broad picture and identifies the root cause of the problem. Don’t see that much anymore in articles like these.
Unfortunately, he does make another point worth noting:

The whole scene is as bleak as it could be, but because of a declining
public interest and perhaps a general stupefaction of the public,
nothing is done about it. It’s a population of sheep being fleeced over
and over with hardly a complaint.

Many people simply don’t care and won’t do anything about it. Unless people stand up, speak up, and take action it will keep happening. If someone is fleecing you with fees, then stop using the service. If everyone did that simple action, it would go a long way to sending a message.

I urge you to check out his current column. It won’t cost you anything but time.

I recently finished a book worth mentioning. It’s called To Rule The Waves: How The British Navy Shaped the Modern World by Arthur Herman. This book has an extensive amount of information in it. I was initially concerned that it would have been overly academic which translates to difficult to read and not very interesting. In addition to laying out the history behind the story, he also examines the people behind the figures presented and leaves all sorts of interesting anecdotes to keep you wanting more. What really surprised me is the number of popular phrases that came from the British Navy such as “three squares a day”.

I had always wondered about pirates and how they related to the British navy and such. If you have watched the Pirates of the Caribbean movies, you start to get the impression that the lines between pirates and the British navy were blurred. It was interesting to read that the monarchy of England actually encouraged and sanctioned piracy as a way to wage war on other nations without having to deploy a full scale navy. There was so much information in that book that it will need a second or third reading for me. They truly did not only rule the waves but at one time, the whole world.

I frequent a budget bookstore on the other side of town from time to time. They have lots of interesting books to be had for a fraction of the price that the regular bookstores sell them for. Recently I picked up a book entitled “Prescription for Excellence: How Innovation Is Saving Canada’s Health Care System” written by Michael Rachlis, M.D.
The reason this book caught my attention is because it is a very frank discussion about the Canadian health care system, otherwise known to Canadians as “medicare”. There have been varying degrees of interest in nationalized health care in the U.S. for some time now. The recent run-up to the U.S> presidential election has brought this issue more to the center than ever before.

The beginning of the book gives a very nice history of how Canada’s health care system came to be and the challenges it has faced in getting there. I’ve barely made it through a third of the book and I’ve already learned a lot. If we in the U.S. put this system in to place, we simply cannot expect that we are going to get it right the first time around. We should expect that if something about it isn’t working, that we need to mobilize changes before it gets out of hand. I plan on reporting more as I read more of the book.

Update: I found out today that Dr. Rachlis has made this book available for free download on his web site. Had I know this before I went to the book store, I could have saved a few dollars. No matter – if it informs and enlightens it will have been worth every penny.