Economic Fragility

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The December 14 “Marketplace Money” on NPR featured a segment on economic fragility.  The guest stated that even households and businesses in good financial condition still feel nervous about their future prospects.  This is data.  Here’s why.

If I owned a business that dealt with the public, I would be very nervous, too.  A bakery, minding their own business, is suddenly demonized by the Obama administration because they won’t bake a cake for a gay wedding?  A major bank once again settling with the Justice Department for millions, if not billions, of dollars based on accusations that are highly questionable? A company being fined because their employment does not match the demographic profile of the surrounding community?  All of this is happening in the U.S. today.

Nervous? You bet.  The only businesses that are not nervous are those who do not realize what’s going on.  Oh, wait, there’s one other group that’s safe — those that are connected to people in the Obama administration.

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About Tony Lima

Retired after teaching economics at California State Univ., East Bay (Hayward, CA). Ph.D., economics, Stanford. Also taught MBA finance at the California University of Management and Technology. Occasionally take on a consulting project if it's interesting. Other interests include wine and technology.