Let’s check in with a guy and his thoughtful mustache posing for his senior photo on the state of today’s economy!
“The deleveraging of America is over.”
“Or mostly over.”
“And that’s good news and possibly bad.”
Robert J. Samuelson, a syndicated columnist, is trying to run through our Economic State of the Union. He’s hopeful that our recent financial challenges — “Borrowers were overborrowed. Lenders were overlent. Credit standards were too lax.” — are behind us. If they are, he suggests, then we might be seeing the start of health for the economy and the American Consumer.
He sees this whisper of health as “deleveraging” — and consumers are now in a better position to, well, consume. It also means they might be in a better position to make good on past due debts racked up while trying to keep their heads afloat.
However, Samuelson is quick to point out that forecasts, by their nature, aren’t necessarily science. They’re educated guesses of a sort that can give the impression of intelligent success. However, both in weather and the economy: it’s just as easy to be incredibly wrong.
The other issue Samuelson sees is a lasting psychological skittishness left over from these many years of economic hardship. “Has this searing experience made consumers so cautious that they might continue deleveraging?”