Sometimes, when you are recovering from an accident or surgery, the doctor will prescribe physical therapy.
The process can be painful, but it increases strength and mobility.
It helps the patient get along better without assistance and become independent again.
Our economy has been involved in a rather nasty accident.
It needs fiscal therapy to get it back on its financial feet.
Okay, so I'm making a play on words.
But I think there is a great deal of similarity between the physical therapy a patient receives after an accident and the fiscal therapy our nation's economy needs to go through.
After an accident, the patient gets cleaned up and has wounds dressed.
There may be a need for surgery to repair damage, and time for bones to mend.
Then comes the process of stretching tissue that hasn't been stretched in a while.
Some actions are repeated again and again to build muscles.
The intended result is a body that can support itself, react with confidence when it needs to, and remain active in the pursuit of good health.
Are there similarities to what we need to do with our economy? Sure.
I think the part about the accident is pretty obvious.
We might not know what hit us, but somewhere during October and November of last year it seems we rode our economic bicycle over a cliff.
The part about getting cleaned up and having the wounds dressed compares to the money that was poured into the economy to replace what seemed to be missing all of a sudden - a transfusion of sorts.
In this comparison, we can see there has indeed been surgery.
Lehman Brothers, and Merrill-Lynch were surgically grafted to other parts of our economic body.
Chrysler has been all but amputated.
GM has been equipped with a large brace (held in place with some screws that penetrate into the Board of Directors).
All this wound dressing and surgery doesn't give us a new economy that is ready to go back to work.
Our patient needs time to mend.
During this mending, we can see some gradual improvement as money becomes available for house mortgages.
We even see reports of new unemployment claims being smaller than what we have seen in the past six months.
These numbers are not as good as what a healthy economy would see, but they are small indications of healing.
We are getting back into shape.
Now we need to begin our fiscal therapy.
Maybe we should start with a new diet to help us along.
That new diet should include plenty of savings and less use of credit card debt.
Our therapy should focus on two major muscle groups: housing and employment.
As we exercise these muscle groups, we're going to feel the pain associated with therapy.
The pain we feel when we exercise housing is felt in rising interest rates.
Housing, by itself, isn't the cause of this pain but it is associated with it.
If more people want to buy houses, the money gets harder to find - interest rates go up.
As we buy more houses, manufacturers have to make more things we want to buy to furnish those houses.
This means they have to borrow money.
That nudges the interest rates up, too.
The pain we feel when we look at employment is taxes.
Maybe not right away.
This may be like the pain you feel the day after your therapy session.
The local and state governments are in a world of hurt with regard to money.
They don't dare raise your taxes if you're not working.
That's why they want to cut services (and jobs).
But as soon as we start to get people back to being employed, there is some catching up to do.
Like the accident patient, we need to work through the pain.
Some days (or weeks) the pain will slow down our progress, but we must stay with the stretching and weight training.
If the accident victim doesn't continue with physical therapy, he (or she) may be living the rest of his life using crutches, or a wheelchair.
They feel pretty depressed when they see other patients get up and walk, or even run, when they want to.
Our nation's health and welfare can't afford to be restricted by an economy that is not in top condition.
There are many other countries who have suffered through this same economic accident.
Will they come out of this in better condition that we will? For our sake, let's hope not.
I don't wish them ill.
But we were at the top of the rankings before the accident.
Let's make sure we're still there in the years to come.
You can do your part by paying attention to what is happening with our economy.
Keep an open mind about what needs to be done, and let your representative and senators know you are watching.
Go to their websites and leave them messages about how you want them to handle the economic issues of the day.
Don't forget to pay attention to the state and local politicians as well.
If you pay attention to this fiscal therapy, you will make better decisions for your own financial lifestyle.
You will make better decisions for your family.
And you will find strength, mobility, and independence in your own financial world.
James W.
Stone lives in the Chicago area.
He speaks on managing your lifestyle and your money.
His special interest involves how we make decisions about money and spending.
http://www.
jameswstone.
com Copyright 2009, James W.
Stone, all rights reserved
The process can be painful, but it increases strength and mobility.
It helps the patient get along better without assistance and become independent again.
Our economy has been involved in a rather nasty accident.
It needs fiscal therapy to get it back on its financial feet.
Okay, so I'm making a play on words.
But I think there is a great deal of similarity between the physical therapy a patient receives after an accident and the fiscal therapy our nation's economy needs to go through.
After an accident, the patient gets cleaned up and has wounds dressed.
There may be a need for surgery to repair damage, and time for bones to mend.
Then comes the process of stretching tissue that hasn't been stretched in a while.
Some actions are repeated again and again to build muscles.
The intended result is a body that can support itself, react with confidence when it needs to, and remain active in the pursuit of good health.
Are there similarities to what we need to do with our economy? Sure.
I think the part about the accident is pretty obvious.
We might not know what hit us, but somewhere during October and November of last year it seems we rode our economic bicycle over a cliff.
The part about getting cleaned up and having the wounds dressed compares to the money that was poured into the economy to replace what seemed to be missing all of a sudden - a transfusion of sorts.
In this comparison, we can see there has indeed been surgery.
Lehman Brothers, and Merrill-Lynch were surgically grafted to other parts of our economic body.
Chrysler has been all but amputated.
GM has been equipped with a large brace (held in place with some screws that penetrate into the Board of Directors).
All this wound dressing and surgery doesn't give us a new economy that is ready to go back to work.
Our patient needs time to mend.
During this mending, we can see some gradual improvement as money becomes available for house mortgages.
We even see reports of new unemployment claims being smaller than what we have seen in the past six months.
These numbers are not as good as what a healthy economy would see, but they are small indications of healing.
We are getting back into shape.
Now we need to begin our fiscal therapy.
Maybe we should start with a new diet to help us along.
That new diet should include plenty of savings and less use of credit card debt.
Our therapy should focus on two major muscle groups: housing and employment.
As we exercise these muscle groups, we're going to feel the pain associated with therapy.
The pain we feel when we exercise housing is felt in rising interest rates.
Housing, by itself, isn't the cause of this pain but it is associated with it.
If more people want to buy houses, the money gets harder to find - interest rates go up.
As we buy more houses, manufacturers have to make more things we want to buy to furnish those houses.
This means they have to borrow money.
That nudges the interest rates up, too.
The pain we feel when we look at employment is taxes.
Maybe not right away.
This may be like the pain you feel the day after your therapy session.
The local and state governments are in a world of hurt with regard to money.
They don't dare raise your taxes if you're not working.
That's why they want to cut services (and jobs).
But as soon as we start to get people back to being employed, there is some catching up to do.
Like the accident patient, we need to work through the pain.
Some days (or weeks) the pain will slow down our progress, but we must stay with the stretching and weight training.
If the accident victim doesn't continue with physical therapy, he (or she) may be living the rest of his life using crutches, or a wheelchair.
They feel pretty depressed when they see other patients get up and walk, or even run, when they want to.
Our nation's health and welfare can't afford to be restricted by an economy that is not in top condition.
There are many other countries who have suffered through this same economic accident.
Will they come out of this in better condition that we will? For our sake, let's hope not.
I don't wish them ill.
But we were at the top of the rankings before the accident.
Let's make sure we're still there in the years to come.
You can do your part by paying attention to what is happening with our economy.
Keep an open mind about what needs to be done, and let your representative and senators know you are watching.
Go to their websites and leave them messages about how you want them to handle the economic issues of the day.
Don't forget to pay attention to the state and local politicians as well.
If you pay attention to this fiscal therapy, you will make better decisions for your own financial lifestyle.
You will make better decisions for your family.
And you will find strength, mobility, and independence in your own financial world.
James W.
Stone lives in the Chicago area.
He speaks on managing your lifestyle and your money.
His special interest involves how we make decisions about money and spending.
http://www.
jameswstone.
com Copyright 2009, James W.
Stone, all rights reserved