Civilization cycle nearing bottom

German Parliament agreed to bail out Greece, but Portugal may be left twisting in the wind. It's been said that a retired banker from Chicago fears the economic situation in Europe is contagious and will spread to the United States within a few months.

According to Marketwatch.com, Citi is predicting a market correction down by 20%. There seems to be no other direction but down, however, I plan on holding my stocks for at least a couple of years, and I plan to trade my shares manually, not setting a trailing stop to sell, because the market is too volatile.

Employment is up over 200K jobs, but those jobs are very low paying jobs that cannot sustain the economy because the lowest housing rates are still well over 50% of median income. Notice that nobody in the news ever mentions this fact? This, plus fuel and utility costs will reduce disposable income to bare essentials such as food and clothing. People who recently purchased a new car or mortgage will soon find themselves upside-down and desperate for someone to purchase those goods.

The local economy is supported by business owners, government workers and health care professionals. Springfield is somewhat shielded from the rest of the state because of such a high concentration of these kinds of workers, however, finding help at a retail store or other private service will be extremely difficult and time-consuming because the merchant labor class has been reduced to mere skeleton crews, rendering the workplace unbearable for the few workers who remain.

Managers are finding themselves sneaking into work off the clock to play "catch-up" out of fear they may be accused of poor management, while in reality the shortage of staff is entirely to blame.

The sudden increase in income for the newly employed creates a temporary surge in frivolous spending that leads into indebtedness. The celebration of getting a job by eating out and buying new clothes will be very short-lived. For those who do not have debt and find themselves with a slightly larger amount of disposable income may be tempted to upgrade their housing, and then find themselves trapped by future increases in utilities and fuel costs.

The solution is simple: Create a solid foundation of disposable income at the bottom of the economy. Bring profit margins down to ten percent and pay your workers enough to stimulate the economy from the roots up. You will have a much safer society with fewer people in prison or otherwise draining the economy through taxation.