Today the House passed the emergency $700 billion bailout of Wall Street, and the President signed it. This is money that will be borrowed and have to be paid back, with interest. This is going to be an incredible burden on the next administration and for future generations.
Such changes in finace and banking truly do have a trickle down to all of us, eventually that is. Those who have investments in the stock market have already felt the pinch. I know it is affecting my business and other small business owners around me. A fellow small publisher told me last night he does not want to print a new edition of "Explore Barbados," despite having several hundred pre-sales, because he thinks the tourism industry will dry up soon, if it hasn't already. Indeed, I was sailing with my dad in the Caribbean this summer and one of the largest resorts in the British Virgin Islands closed up for four months, sent staff home, and hopes the industry will rebound and they can just *break even* during high season in the winter.
There is a pretty good chance this bailout will work, the markets will recover, and credit will resume. But what if it doesn't? It seems to me the Feds are simply running out of options. How many more times will the Chines or Japanese extend us these kind of bail out loans? How many more percentage points more can the Feds lower the interest rates? And more importantly, who says this is the end-all to the financial meltdown?
That said, I think it is important to remember that the markets and money are human inventions that can come and go. Even if we experience a total collapse, we are still people who need to get along, survive and reinvent ourselves once again. It may not be a pleasant vision of the future, but it's a way to remain calm in a time of great upheavel. Indeed, we still have much to be thankful for, and it is important to recognize this.
Maybe this is the best time of all to leave the country and travel for a month or two?