Tuesday, October 7, 2008

The economy and crisis of confidence

History repeats itself.

With financial markets in retreat, investors keeping to the sidelines, consumers inhibited from making purchases, and business investment practically at a standstill, this short phrase has recently become ubiquitous – “crisis of confidence”.

It’s actually a phrase that dates back to a 1979 speech by US president Jimmy Carter, to describe what was happening to the economy during that time. He said that the problems of the economy could be solved by first solving the problems of the spirit.

Interestingly, though reaction to the speech was initially favourable, it eventually boomeranged on Carter. The op-ed pieces started spinning out, 'Why don't you fix something? There's nothing wrong with the American people. We're a great people. Maybe the problem's in the White House, maybe we need new leadership to guide us.'" "If you are president and you're going to diagnose a problem, you better have a solution to it."

Obama/Mcain, take note.

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