The economy, credit, and the trickle-down economy (the domino effect)

When people spend money, someone is affected. If you spend a dollar or a million, spending money creates cash flow, cash flow creates jobs. The economy is driven by the exchange of goods and services and the movement of money. Even money is a product, when credit is too expensive in the form of higher rates and fees, consumer spending is limited, especially for larger purchases. The current credit crisis is an example of this. When consumer options are limited because credit is not available for larger purchases, it can have a devastating effect on all types of businesses connected to those products. When business is successful, we all benefit. A particular business may need a vendor or shipper, a printing company, or any other type of business service. All those companies benefit, as well as their employees and the local economy where that company is located. An example of this is a company with 250 or 500 or any number of employees in Anytown USA. When those employees go to lunch, buy gas for their car, shop at local stores near work, etc. it has a positive impact on the local economy. Spending money is extremely important in boosting the economy, which is why every news station in the country reports on year-end sales figures. Because it affects all companies that manufacture, ship, sell, repair, clean, install or advertise those products. If companies don’t make enough profits, they lay off workers, fewer workers means less money is spent and, in turn, more jobs are lost. Many different types of businesses depend on each other to survive. Let’s say a very large company does business with several hundred other companies, such as Wal-Mart or General Motors. Now, think about all those employees and all the products and services they spend their money on. It can only do good things for the economy, however if a large part of the flow of money stops, big problems can occur, just like the problems facing our economy now.

Now let’s take a look at the rich and its effect on the drip. If a person, rich or poor, or anyone in the middle spends money, someone benefits, but let’s look at it from the top down. Some rich person has his own business or several businesses and employees Xnumber of people. Those employees pay taxes and spend money on all necessary living expenses and someone else gets their income from that money. Also, this rich guy may own a house or two or three, and when he buys a house or a car, the money exchange is paid, more taxes are paid, and income is earned, etc. What about the maintenance of your house and your cars? Painting, roofing, carpet cleaning and floor care, auto and home maintenance, auto mechanic, car wash, tires. The list goes on and on, so I really don’t think anyone should bother when the rich get richer, because they are more likely to spend more and have a positive financial impact. All companies that help maintain their assets and those who work for them receive a benefit and in turn employ others who also spend money and pay taxes. So a wealthy person automatically redistributes wealth every time he spends money. Building wealth is the reason most people have a job in the first place. Businesses do not start from scratch, they are started and run by people, and if they are successful companies, it is possible that someone has become rich because of it. That wealth is spent and maybe that rich guy decides to start another company or let someone else start their own business and the trickle cycle starts all over again, so thank some rich guy for the fact that he even has a job. Everywhere you spend your money, someone is making money and you are supporting a job and a business. The economy works well when we spend money, the more we spend, the more everyone benefits. TRICKLE DOWN MAKES TRICKLE DOWN. It is an economic fact, even if the rich get richer and the poor get poorer, money continues to flow from the top down. If an area has businesses, it has employees who spend money on food, housing, transportation, entertainment, and many other things. So think about the benefits of large companies improving the revenue of many other small businesses nearby. Many companies do business with each other and this improves the financial situation for everyone, so spend some money.

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