bMighty vs. Bernanke: Unintended Consequences - InformationWeek

InformationWeek is part of the Informa Tech Division of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them.Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 8860726.

10:02 PM
Fredric Paul
Fredric Paul

bMighty vs. Bernanke: Unintended Consequences

This whole economic crisis is starting to look like a movie of a spectacular multi-car freeway wreck -- in slow-motion with no sound. We watch individual drivers careen about tying to avoid the pile-up, but end up causing new accidents.

This whole economic crisis is starting to look like a movie of a spectacular multi-car freeway wreck -- in slow-motion with no sound. We watch individual drivers careen about tying to avoid the pile-up, but end up causing new accidents.The problem is that as we watch bad news follow bad news in an economic death by a thousand cuts, the reactions often seem guaranteed to make things worse. Which leads to more bad news. Which... well, you get the picture:

GM is just about out of cash, but even people with secure jobs don't want to buy a car while someone they know is out of work. All the automakers want a bailout, but then everyone else wants one too, and no one takes responsibility for their own business.

Gas is cheap, but as soon as we start buying it again, it'll likely go right back up.

The stock market shoots up 550 points one day, when people feel that stocks have gotten cheap. The next day everyone tries to dump their shares before it's too late to cash in on the gains, so the market heads down 338 points. The end result of this crazy volatility -- the market is down 5% for the week.

Meanwhile, the government can't quite decide how to spend its $700 billion bailout, changing its mind from buying toxic debt to shoring up the banks. But the banks who do get their hands on some of the cash use it to buy other banks instead of lend to customers.

Tech companies have good quarters, but say they expect bad quarters to come, so they lay off thousands of workers.

Scared individuals start saving, which we were always told was GOOD thing. But that means retail sales tank (even though somehow no one seems to be hurting from not having enough stuff). Were we buying all that junk just to keep the economy humming?

The rANT has an idea. Instead of everyone racing for the bottom and making things worse along the way, let's all start being sensible, but courageous. We can be prudent, but not panicked. Instead of slamming all spending to halt, let's buy what we need, and buy quality when we can find it. Let's do our best to keep our best workers, not jettison them all as quickly as we can.

The rANT would like to see a company stand up and say, "No matter what, we're not going to lay anyone off. We'll cut back, we'll reduce hours, we'll find ways to economize, but we're in this together and we're not going to make it any worse than it has to be."

Heck, at least say that they're going to do their best not to cut folks unless there's no other choice. It'd be great PR, right? And maybe the government could do something to help out. A tax credit, or something. Maybe that would help other companies make similar decisions. If that leads to recession, well then so be it. Maybe we asked for it with the excesses of the last few decades. But The rANT thinks we might just have chance to keep things from getting really, really bad if we take this as opportunity to do the right thing. To spend on things that make sense. To share the pain, as well as the wealth.

Nah, it'll never happen. Bring on the pink slips!

We welcome your comments on this topic on our social media channels, or [contact us directly] with questions about the site.
Comment  | 
Print  | 
More Insights
The State of IT & Cybersecurity Operations 2020
The State of IT & Cybersecurity Operations 2020
Download this report from InformationWeek, in partnership with Dark Reading, to learn more about how today's IT operations teams work with cybersecurity operations, what technologies they are using, and how they communicate and share responsibility--or create risk by failing to do so. Get it now!
The Best Way to Get Started with Data Analytics
John Edwards, Technology Journalist & Author,  7/8/2020
10 Cyberattacks on the Rise During the Pandemic
Cynthia Harvey, Freelance Journalist, InformationWeek,  6/24/2020
IT Trade Shows Go Virtual: Your 2020 List of Events
Jessica Davis, Senior Editor, Enterprise Apps,  5/29/2020
Register for InformationWeek Newsletters
Current Issue
Key to Cloud Success: The Right Management
This IT Trend highlights some of the steps IT teams can take to keep their cloud environments running in a safe, efficient manner.
White Papers
Twitter Feed
Sponsored Live Streaming Video
Everything You've Been Told About Mobility Is Wrong
Attend this video symposium with Sean Wisdom, Global Director of Mobility Solutions, and learn about how you can harness powerful new products to mobilize your business potential.
Sponsored Video
Flash Poll