Are you one of those who believe that the economy is going to hell in a handbasket? Lets look at our situation. Over the last 100 years, the stock market has returned an annualized rate of just over 10 per cent. Shorter cycles had, of course, better returns if you had picked the bottoms and tops of each cycle. But that would have been impossible. Lets look at the last 50 years. In the late 1950s we had a recession but by 1966 the Dow Jones Industrial Average was at a new high. At that time there were great American companies which were referred to as the "nifty fifty" of which General Motors, Polaroid, General Electric, etc. were a part of. The market pulled back but tested those highs again in 1969 before the recession and energy crisis in the early 1970s. Unemployment was over 10% and the U.S. went off the gold standard. By 1980, we experienced a recovery in the economy as well as another energy crisis. The stock market had performed nicely until the middle of 1981 at which time we went into another recession which lasted until August of 1982. The Dow Jones Industrial Average fell below 700 before the reversal took place. By 1983, that average reached a new high after struggling for almost 17 years and tripled by 1987 before the big correction came which was only that amount it had gained that year. By 1992, that average was over 3,000, by 2002 over 11,000, and by 2007, over 14,000.. There were corrections in between, of course, but despite wars, energy crises, and recessions, you can see the trend. Our history has proven that as long as people are free, some of them will innovate, create, and be productive. The problem we now face is that there are too many freebies and very little work ethic.
Back in the 1950s, when I was a teenager, my summer breaks from school consisted of being picked up for work before dawn and brought home after dark. In North Dakota, that was a 16-18 hour workday and during harvest, 7 days a week. Today, you are lucky if your employee shows up for work, let alone work. Back then, the vehicles were unreliable, uncomfortable, hard to drive, cold in the winter and hot in the summer. Today, you can start your car from the mall and by the time you get to it, it is warm in the winter and cool in the summer. You dont even have to crank up the windows anymore and it tells you when you need to change the oil. In this age, you do not need the library, stores, etc. as almost everything can be done online. But yet, so many people sit on the couch and complain as to how hard they have it.
The benefits today are unbelievable with unemployment, subsidized housing, food stamps, etc. I have heard people do the math to determine how close the benefits are to actually working for a living. If it is close they will not get a job. When I see children having children, just for the benefits(or plain stupidity) I cringe about our future. When I hear Speaker of the House, Pelosi, talk about taxing the retirement accounts of those who have them and worked hard to built them up, just to give money to those who have not planned ahead or are illegal aliens in an attempt to raise their standard of living, I become ill. What every happened to taking care of yourself? Why should they be helped to leach off of those of us who do work and pay taxes?
I hope that because of our system, enough people will be able to create, innovate, and implement changes that will cover the needs of those deadbeats not willing to work and contribute. If not, we are doomed and the economy will go to hell in a handbasket.
Richard C. McPherson
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