Economics 101

I am not an economist. But I read the business pages in the paper, even more so lately. Anyone who was surprized about the movements on Wall Street and world wide financial markets this week must be living in a parallel universe. It was bound to happen, and – my two cents – it ain’t over yet.

1) If you spend more than you have, that spells trouble.

2) If you still thought in terms of Dow 50,000 talking about real estate, that spells trouble.

3) If your economy is built solely on the faith other people have in your currency, that spells trouble.

Stock market crashes are good. They are like mass extinctions that wipe out what shouldn’t have proliferated in the first place. Recessions are necessary. They take us from icy peaks back to mean sea level. They create new potential for growth and innovation. They are as unavoidable as the four seasons. Some are prettier than other, some longer, some shorter. But there is no dodging them. So let’s get it over with. DOW 10,000, and it’ll be time on invest again.