Bye Bye Jobs
Recent stories about Ford and others laying off tens of thousands of American workers to try and save companies circling the drain are disturbing. A story in the paper last week said Kraft Foods, “the nation’s largest food manufacturer�, plans to lay off 8,000 workers and close as many as 20 plants, this on top of earlier cuts. At the same time, Kraft reported it’s fourth quarter earnings rose 23 percent, beating even Wall Street estimates.
This would appear to be yet another case of American jobs disappearing into the far east, where they can manufacture food for a fraction of what it costs to do it here. In the case of Kraft, they do it to make MORE money. It reminds me of the time I and a couple dozen others were NAFTAed out of a job here in Humboldt County (thank you, Bill Clinton) not long after 1,200 Pacific Lumber employees were Hurwitzed out of their jobs. In both cases, the companies putting people out of work were making plenty of money: they just wanted more.
The question is, how long can this go on?
An adjacent story in the paper said the savings rate among Americans is the lowest now since the great depression. “That means that people not only spent all of their after-tax income last year, but had to dip into previous savings or increase borrowing,� the story said.
The answer is: not much longer.
Regardless of your political beliefs, you can’t help but wonder what happens when we hit the wall that is coming closer and closer. When you look at what savings accounts pay in interest, it’s no wonder people are putting their money into real estate, or stocks. . .or even Hummers, big screen TV’s and lotto tickets. Even at 4%, you’re not keeping up with inflation in the real world. But this is obviously not something we can keep doing, especially with gas, energy and health care costs going up many times faster.
So, assuming somebody reads this, and can reply, what do YOU think? Should we sell everything and buy gold? Should we install huge gasoline tanks and invest big time now, and wait for the price to triple (until supplies dry up).
Or should we just bet the farm that Exxon, Kraft and Halliburton stock will rise indefinitely, with strictly Mexican, Chinese or Indian employees? So far, this appears to be the elephant in the living room everyone pretends isn’t there.
Comments
You can get 4% in a savings account? Where?
And forget the elephant in your livingroom. Overpopulation of the planet is the 800 pound gorilla ringing your doorbell.
Posted by: Robb Willis | February 9, 2006 12:07 AM