Flow of electron is current and flow of cash is economics. If no electron flow then there is no current and if there is no cash flow then there is no bright economy. It is as simple as that.
What is the solution for the current economic crisis?
Increase consumer confidence
Consumer confidence is measured by the consumer confidence index and it is record low now. Economics is a social science studies the production, distribution, consumption of good & services. Consumption is the driver for distribution and production. The consumer adapts a conservative approach for consumption of goods and services and hence there is a slow down in the whole cycle. The conservative approach chosen by the consumer due to bleak future. Consumer are not spending due to uncertain future and current & near future depends on the consumer spend. I call this situation as “economical dead lock”.
The lock only be released by consumers and it depends on creating HOPE in them. Any big events in first quarter of 2009 is going to create that hope in consumer. The big event could categorically be under geo-political, scientific invention, leadership, Government policy.
The president elect going to sworn in first quarter of 2009 and he already made clear that his top priority is to focus on economy. By introducing new policies, regulation and deregulation in certain areas, introducing all construction projects are likely would provide confidence in consumer that there is a bright future ahead. That magic would release the economical dead lock.
It is highly likely that global economy will turn around by 3rd or 4th quarter of 2009.
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