Like any problem, our deficit problem is fixableWhen you run a business, you’re constantly trying to look ahead. You make decisions now on hiring, spending, and investing that will position your company to either grow or just weather the storm. You know you can’t control the future. But you can take some measures to protect your interests and lower your risks.
Economists like to say that you can’t compare a public entity’s financial statements to a company’s financial statements because some of the dynamics — like the ability to borrow and print money — are different, and they are right. But there are still many similarities, and whether you’re looking at a P&L for the U.S. government or my company, the fundamentals are still the same: debt maintenance is fundamental, and every entity needs to bring down its debt to sustainable levels.
Unemployment will spike. There will be a worldwide depression, as so many companies around the globe depend on U.S. consumers and markets. The dollar will significantly weaken, making goods purchased overseas more expensive. Stocks will fall. Bonds will be harder to issue. Some banks will fail. Capital will be restricted. Household wealth and retirement savings balances will markedly decline.