Are you Walking the Financial Tightwire? Part 2

Last week we started a discussion on the financial market and how it is impacting you. We have got Dr. Louis Pantusco, Professor of Economics at Winthrop University answering some questions. He is helping us get some of the insider information on what is going on in the economy. Today we are looking at two issues. Job Market and when will this economy recover. Here is Dr. Pantuscos input on the struggling jobs and when we can expect the economy to begin to improve.

The job market is the last to feel the hit of an economic downturn, and the last to recover. Usually, employers wait to see if business is simply declining for a season or if the decrease is permanent before they lay-off workers. The same is true at the other end of the cycle, businesses want to see strong signs that demand for their product is returning before they rehire. Nationally, the unemployment rate has been rising for a year, but in the last two months over one million jobs were lost. More losses are on the way. It will take a while for new jobs to be added. While, the stimulus package will help, it may simply serve to keep government employees busy. For example, Charlotte received money to widen route 51 from Pineville to SC. Will the city of Charlotte hire more people with this money, or use their current workforce? Since government agencies are slow to lay-off workers, the city may just use their existing workers and keep them employed and funded for longer. This approach eliminates the future financial strain of wages and benefits when the job is complete. In this example, the stimulus money enters the area but no new jobs are created.

Since the stock market is a lead indicator, the first signs of recovery should be witnessed there. The problem with the stock market is uncertainty and, of course, confidence. Consumers are saving because they are unsure of their jobs, and banks are tight because they are uncertain about the profitability of investment projects. Wall Street is in a reaction mode; their heads are spinning trying to decipher the latest bailout from Washington. All of this uncertainty bothers the stock market.

In summary, the market adjusts when wages and prices adjust. Businesses failing and being bought out are part of the adjustment process. Workers being laid off is part of the adjustment process, and prices falling on homes and other items, is part of the adjustment process. While there is a lot of agreement among economists that something should be done, it is clear that government intervention distorts the picture. It is harder to determine where the bottom is and when the recovery will begin because the government artificially is maintaining the economy.

Are you Walking the Financial Tightwire? Special Guest Blogger Dr. Pantusco

I know that many of you are like me and very frustrated. Frustrated at yourself and others who have made some really unwise financial decisions. The current economic crisis in our country is the direct result of people who have made some poor decisions over the last 20 + years. I want us to learn from our current economic "crisis" and make new decisions moving forward into the future to put us in the best possible shape financially. I asked Dr. Lou Pantusco, Professor of Economics at Winthrop University if he would mind answering some tough questions about the current economic situation and to give us some practical tips that might help us moving forward.

For the next several days I will post some of his answers and feel free to chime in and ask your own questions.

The first Question: Should we listen to the government and other "experts" and spend more or save more during this economic crisis?

As an observer of Sunday’s service on the economy, I was amazed and impressed with the clarity and simplicity of Chris’ message. There were a few points that he made that I thought were perfect! Specifically, his critique of the economist who claimed that “this is not the time for American’s to start saving” was right on. I agree with Chris. If Americans had been saving over the past decade, we would not be in the mess we are in. The number of foreclosures would be much less, consumer spending would be more consistent, and subsequently, there would be less employment fluctuations. In the fourth quarter of 2008, US spending (consumption) decreased by 3.8 percent, and savings actually increased by 3.6 percent. The starting points for these numbers are completely different, so one cannot say the reduction in spending equals the increase in savings. However, there is a trend toward savings and away from consumer spending. More specifically, the numbers suggest that consumer spending has decreased on “food, clothing, and automobiles”. In South Carolina retail sales fell by 23 percent. All this simply means people are being more frugal with their money, they are not going out to restaurants to eat, they are not spending as much in malls, they are not buying new automobiles.
While the health of the US economy is dependent on consumer spending, the welfare of your family depends on personal savings. Should you focus on the economy or your household?

Thanks Dr. Pantusco. Great post! What do you think? What are your questions for Dr. Pantusco?

11 Year Anniversary of NRHC

It seems hard to believe 11 years ago a handful of people were meeting in my little house with a common vision to do "church" different. A group of people who were tired of people saying they were Christian and acting Religious. (We saw that before... Pharisees!) A dream that maybe "church" could be done different. Maybe the "church" could make a difference in its city. Wow! Who would have thought how far we would have come.

Yes, we have grown in numbers meeting each week. We have met in 5 locations and have outgrown all 5 locations including our brand new building. We have went from a house, to a temporary facility, to a school, to the "domes," and now on a 34 acre campus. When it comes to buildings... we never have enough room! Wow!

But let me share with you what our greatest success is... a growing vision. We have never settled for where we have been. Over the years we were just happy if people showed up. Then we decided we needed a clearer purpose and began to focus on making disciples. Over the last several years we have moved from small groups and classes to now instituting a new system... one on one mentoring. However, our vision grew! Over the last several years we have been convicted that it is not about our church... but rather God's Kingdom. We have begun the process of reaching our city by partnering with local school, construction, and Movies in the Park for families. We have begun to plant churches. Currently we have supported 6 churches in US, 9 in Cuba, and 3 in Costa Rica. We have begun a Church planting center not only for Anglo Churches but also Hispanic. Wow!!!! The vision has grown!

Let me close with this thought. Our greatest days are not behind us... they are ahead of us. If this is what God can do with a few people... just imagine what He can do with a army of people who are committed to a big vision! What if not only our church had a big vision but what if we partnered with other churches who had big visions. We worked together to make our cities a better place to be. In 2009 we will ramp up our efforts to help people follow Christ in their personal lives, we will up our commitment to plant churches, and we will begin the process of collaborating with other churches to make our city a better place to live. Let us dream big... and ask God to allow us to be a part of something so great that no one person could take credit. Let us be a part of something God sized!

Happy Birthday North Rock Hill Church!