Has Economy Reached Bottom?

Recently in the news we have heard US President Barack Obama and Canada's Prime Minister Stephen Harper aired their optimistic views on the current economy. The economic melt down process reached its bottom. and there are already signs of positive recovery in the economy. I am totally agreeable on what they try to do but not their view of a speedy economic recovery. In their respective positions, they are doing what they are supposed to do. That is to boost the general consumers' confidence.

It is just wishful thinking that the economy reached its bottom. Let us look into the real estates in North America, Europe, Asia and the Far East. The market is beset not just by the credit crisis but also the lack of confidence brought about by the massive job cuts. The American auto giants GM, Ford and Chrysler are deep in their  money crunch and sales slump. If these giants were forced out of business, the rippling effects will be enhanced and felt all over the places in this global village.   In the news people can see huge price cut for Chrysler cars and trucks by the car dealers ... as much as 40%.    Carmakers  are cutting down their dealers by 1000s.    The automakers have no choice but to downsize their workforce and expenses to meet the bailout requirement of the government.

These days, job cuts have already triggered off into different industries and businesses.  People 's working wages are reduced by either cutting the rate or working hours.   Unfortunately, it may develop into  trend that most business owner follow suit.    Even big companies with profits join the wagon to cut jobs and work hours.   All these would dampen the consumers confidence contradicting the effort of  Barack Obama and Stephen Harper who try to revive the economic engine with their bailout packages.   Co-ordination amongst businesses and government is of paramount importance.   Hopefully, the governemnt will do more co-ordination to make the recovery plan working effectively and efficiently.

The recent financial melt down is the residual of years and years of greediness, complacency, mismanagement and lack of long term vision amongst  the top executives. The short sighted leaders lead their companies into this financial crisis.  The people working on the floor are the victims of the turmoil brought about by these  leaders blinded by their greediness and complacency.

The bear market is  here to stay with adjustments.  When people regain their confidence upon abundance supply of jobs, they will spend more money. Businesses of different sectors will then start booming again and speed up the economic engine.  Currently people are in the shadow of job cuts and wage reduction,  spend  money is low in their priority list.

Ask ourselves the questions:

* Will GM, Ford and Chrysler survive this Financial Crisis?
* What if they cannot?
* What will be the damage as the result?

I am not sure what will happen in the next 12 months? But I am very sure it is a time of great changes.