Our recent remembrance of 9/11 brought back many stories of courage. It is an event in our collective memory that will not soon fade as we recall tales of ordinary people doing extraordinary things. Something struck me as very compelling as I watched the news coverage off and on last week on 9/11. Looking at the economic indicators for 9/11/2010 they were remarkably similar to the benchmarks recorded on 9/10/2001, the day before our attack. The Dow closed on 9/10/01 at 9605.41, and closed on 9/11 of this year a bit above 10,000. Not that far off. People were coming and going to work and school much in the same way that we are doing today.
But there are some differences that are striking though. In 2001, home ownership was common and existed as the primary savings investment of the average American. Financial crisis was triggered then by some business excess inventory or the more typical corporate malfunction or malfeasance. Now it is different. Now the instability is of a different nature. Now 1 in 7 homeowners are at risk of loosing their home. Now we have pervasive mistrust of government and its ability to put us back on track. There is pervasive mistrust of the ability of our fiscal policy to right any looming financial wrongs. According to Mort Zuckerman, CEO of Boston Properties and interviewed on Fox News (9/11/10), “The country has not forgotten. But we have lost our sense of unity. Now is not the time for everyman for himself.”
Listen to Bill Johnson, CEO of HJ Heinz, with his direct, no nonsense perspective on the effects this has on business. According to Johnson, put simply, there remains a lack of consumer confidence. Business is not buying. Business is waiting on concrete, structural change from leadership that will encourage spending. Short term policy fixes just do not work. Look at the 2003 Bush Taxcut effects for example. As businesses knew these cuts would be around 7-8 years, we saw the economy rise. It is not surprise that the economy stalls when there is discussion of removing those cuts. Consumers have basically gone underground and are looking for long term, predictable, sustainable policies. We would be wise and advised to remember this if short term economic stimulus is put into place to put a nice blush on the rose just in time for election only to see it whither and fall as soon as the ballot box closes.
According to previous Attorney General Alberto Gonzalez, we are indeed safer because of the Patriot Act and cooperation around the world, but mainly because of the work of individual men and women like you and me. Men and women, who work hard, take care of their families and each other remaining constantly vigilant and engaged. The alert individual, paying attention to the daily details as we have learned, is more valuable than any government agency or watchdog. The big message here: if you find yourself in the next big storm, don’t wait for someone to pluck you from your roof. Prepare for the storm in advance. Now is the time to take inventory of your financial house and work to educate yourself. It is okay to demand more of yourself, and I would submit that it is okay to demand more of our politicians. And perhaps now is a good time for our politicians to demand more from themselves.
And remember, take care of your customers, or someone else will.
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