Yet easy money has encouraged people to borrow more and has thus delayed the inevitable adjustment in households' balance sheets.
If they want to go on working, they will have to accept that pay can go down as well as up.It will all work out, sort ofCan governments make sure this inevitable adjustment goes smoothly?
It may yet prove shrewd, but their expectation that he contribute immediately, after they chose not to add another veteran receiver to account for his inevitable adjustment, is, at best, misguided and, perhaps, downright foolish.
The U.S. current account deficit, which recently tipped the scales at 6.2% of GDP in the third quarter of 2005, is unsustainable, and the economy cannot avoid the inevitable adjustment.
For instance workers with temporal contracts received during the boom mortgages with LTVs that were economically and statistically identical to the mortgages received by permanent workers, though the former were more exposed than the latter to the inevitable adjustment in the real estate sector and thus more likely to be unemployed.
Projects financed by state funds would do little to impact growth in the short term, would make the fiscal deficit worse, and would only delay the inevitable adjustment.
Tech-oriented WIRED magazine, for example, recently published a piece predicting that those with the once esoteric knowledge of writing programs for computers likewise will witness a glut around them, followed by an inevitable adjustment to their wages.
"This crisis is much more severe than the two the country confronted and recovered from, in 1999 and 2003, after successful stabilization of the economy" 21 years ago, wrote economists Mansueto Almeida Jr., Marcos Lisboa and Samuel Pessoa in a paper about the upcoming " Inevitable Adjustment".
Yet there are also times when swift and temporary actions can help ensure that inevitable market adjustments do not undermine the health of the broader economy.
