Don'e let it happen!
This is going to be a challenging year. The U.S. Congress and the incoming Obama administration are already at work trying to come up with programs that will quickly solve the economic woes of our nation and perhaps the world. Unfortunately every proposal seems to include more government involvement, regulation, and spending. That does not sound like a good prescription to me.
I learned in Economics 101 the basic facts about the relationship between supply and demand. Those facts are simple: In a free market, price will make the supply of goods and services equal the demand for them. If there is an oversupply of something, its price will drop, stimulating additional demand and eliminating the oversupply. If something is in short supply, prices will rise to reduce demand and eliminate the shortage.
The rules of supply and demand are based on human nature, they are as unchanging as the law of gravity, and they are still valid today.
It is often forgotton that consumers have a responsibility in controlling the price of goods and services. They should seek lower price alternatives or reduce consumption (demand) when the price of a good or service continues to rise.
In a recession such as we are in now, companies should focus more on reducing cost rather than just passing higher cost on to the consumer.
We as consumers and companies never learn from the past. That's why we continue on a regular cycle of recessions. We may be on a path now that is going to lead to more than recession this time around; I hope not, but I don't see the right things happening to prevent it. We have and inflation cycle coming up later this year due to the treasury printing of money. If we as consumers do not retard prices from suppliers of goods and services, we are as responsible as they are for the price increases that may lead to hyper-inflation and very possibly a DEPRESSION.
