End of Consumption Cycle?

With the high rate of unemployment today, we hear this complaint often that we are not growing (in GDP) because we are not spending and unless we spend more, there is not gonna be enough work (to produce), i.e., less jobs. Wait, but isn't that's the reason for less spending in the first place? So looks like we are in a downwards spiral, which is technically nothing new, the pundits say every recession we see this phenomenon.

If we care to ask why this phenom, well we just said because of recession then the real question is why recessions? Oh, don't even go there, that's an age old question. Since (economics) times immemorial experts have tried to answer that, some even tried to co-relate these downwards cycles with the position of stars, I wonder if they were closer than where we are today.

Well, for whatever its worth, here is a thought - if we reverse the cycle mentioned above, meaning consumer spending > production (jobs) > wages > growth > higher living standards (more desires) > more spending > more production > more growth .... is this really sustainable? Could this cycle, growing out of bounds, causing humongous waste and environmental destruction, not become a cause in itself to produce the recession which is nothing but a correctional force that Nature puts forth to set right the deviated behaviors.

If so then,

1. We must realize that in a growing economy the lines between needs and wants gets blurred, our desires take over us and enslave us, causing an ever growing living standards, cutting off our connection from simple and natural living. So these unchecked desires at individual level are the real cause of bubbles or excesses, those are bound to get bust
2. We must learn the right lessons from the recessions so that we don't fall into these cycles again and again, ad nauseam.

What is that lesson? When I have $100 in my pocket and I suddenly get an urge to buy that new gadget, at that moment, having the courage to ask oneself - do I really need that, will I use that FULLY or do I want that just so I look cool etc.; and then choosing to be wise to let go that urge and free oneself from the bondage of desires. Sounds very much like spirituality isn't it .... perhaps there is not much difference between economics, democracy and spirituality, after all situated at the center of all these is - I.

P.S: Written while having been unemployed for 2 weeks

Time for People 2.0?

The underlying driving force behind Democracy and Markets (Capitalism), the two great forces of modern times is really - People. The underlying assumption here being - "whatever people demand must be good, hence the system must allow that to happen". Nothing wrong so far in the logic, all seems pretty natural and isn't that the real strength of these systems that it resembles nature when it follows laws like the survival of the fittest etc. However, there is something comfortably disguised in the above assumption and it is in the word "demand". In terms of natural laws, this demand would really translate to need, which would really translate to vacuum. For example, why air, water or electricity flow from higher pressure to lower pressure etc..

Now comes the real question - is there something wrong with people's demand today? Well one need not ask anyone else but oneself, do I always take buying decisions based upon what I really need, do I demand from my politicians what is really needed for us or am I getting influenced by those million dollar ads, am I getting influenced by fear, greed or any other external agent, like in this picture can we say the next decision these traders will take will be free of any emotions.

Actually there is a even bigger question if one might have the courage to ask - do I even know clearly what are my real needs and what comes in the zone of superfluity.

If I find that many times my actions are affected then a well running Democracy or Market will only amplify it to a magnitude proportional to the sheer number of people multiplied by degree of affectedness. So if this is the case then what is the point in blaming the Hill or the Street, they are a mere reflection of what we are, a mechanism to channel our own individual tiny forces. If we agree with any of this above, it should make it clear where should my efforts go if at all I am really interested in bringing forth a correction.

To nip perverted thinking that by raising these questions I am suggesting to go back to the world of feudal lords or dictators, I must say that this is really for the present and young generations who MUST question the state of Democracy, Capitalism and the driving force behind these, i.e., ourselves, and they must inquire and investigate what is missing, what is not right with courage to accept where needed, so that we can evolve to systems which are better in all respects.