Calling All Economist . . . Recession or Media Obsession?

Stock markets falling, banks writing off billions, economists warning of decline-it all sounds like an economic doomsday.  Yet, that is exactly what we are seeing everyday in the news, an obsession with recession.  While I am no economist, I have to wonder . . . Is this so-called recession because of problems in the domestic and global economies, or is it because of media-driven scare stories.  The "experts" say that we will not know if the economy is in a recession until 6 months after the fact.  However, I cannot help but think that all of this speculation and so-called "news" is contributing to the problem rather than helping solve the problem.

Think about this.  People watch the news and hear about the stock market continually falling, unemployment rising, housing bubble-bust, and all of this leads the media to the conclusion that we must be in the middle of a recession.  But no one really knows.  So in an attempt to save their retirement portfolios, people start liquidating assets, and then boom . . . we find our economy on the downslide because people are saving all of their funds and liquidating assets.  So maybe, just maybe, if the media would scale back their economic scary recession talk, and quit terrifying soon-to-be retirees, this recession problem might just slow down, solve itself, and the economy could get back on track.  The market always has its ups and downs, but the media seems to make it worse than it really should be.  Lets face it, people make bad decisions when they are emotional (excited, scare, angry, etc.).  All of the media hype about a recession promotes those emotions and then people make irrational decisions regarding their investments.  Perhaps we should take a step back to evaluate the situation instead of running head first into a recession that does not have to occur.

By: Andy Thomas