Sponge And Water Analogy
Let me give you an Analogy that describes my Philosophy about why, for approximately 228 years, the U. S. real estate market and overall economy have boomed and why that boom is now over.
Imagine a dry Sponge and a bucket of Water. The dry Sponge represents American consumers’ Demand for products and services throughout the history of our country which of course started in 1776. The Water in the bucket represents the Supply of products and services American consumers have desired and purchased since 1776. Now, further imagine that from 1776 through approximately 2004, the Sponge was constantly able to absorb Water from the bucket. As the Sponge absorbed the Water, throughout this period of time, the U. S. real estate market and overall economy were able to significantly grow and prosper. Why? Because Demand, virtually always exceeded Supply. However didn’t anyone ever stop to think, either at the beginning or during this approximately 230 year period, what would happen if and when the Sponge reached its maximum level of absorption? Apparently not! I guess virtually everyone, throughout the history of our country, was content believing that we had a Sponge that was capable of absorbing Water for eternity and a Water supply that would last for eternity as well. Well guess what? The Sponge was not capable of absorbing Water for eternity nor was the Water supply capable of lasting for eternity either.
Look at it this way, for approximately 230 years, the Sponge was able to absorb the Water in the bucket. However around the end of 2004 and early 2005 the Sponge finally became waterlogged. As a result it was no longer capable of absorbing any more Water. In order for the Sponge to be able to absorb Water again it has to be thoroughly wrung out so that the absorption process could start all over again.
The above Analogy is exactly the same as saying that after approximately 228 years consumer Demand (Sponge) became waterlogged. As a result consumers were no longer in a financial position to purchase the Supply (Water) of products and services that remained in the bucket. Therefore it then became necessary to thoroughly wring out the Sponge so that the consumer supply and demand absorption process could start all over again. However during this wringing out period the U. S. real estate market and overall economy will experience a slow down period. Depending upon the amount of time that it takes to wring out the Sponge the real estate market and overall economy slow down period can last for either a short time or a long time. A short time period doesn’t really hurt the U. S. real estate market and overall economy that badly. However a long time period can devastate them. The long time period is exactly what has happened to the United States. Why? Because since late 2004 and early 2005, when the U. S. real estate market and overall economy started to deteriorate, our government has been unable to get the Sponge wrung out. As a result approximately 4 years have gone by without the consumer supply and demand absorption process starting again.
Failure to get this absorption process started again is exactly why the U. S. real estate market and overall economy are now facing many, very serious, and monumental Financial Problems. The creation, existence, and continuation of these Financial Problems have literally brought and continue to bring millions of Americans and their businesses to their knees both financially and psychologically. Until the consumer supply and demand absorption process gets started again the U. S. real estate market and overall economy will continue to deteriorate. As they continue to deteriorate, which they will as long as our government continues to implement crisis management business practices in their attempt to get them back on track, it will result in even millions more Americans and their businesses being brought to their knees both financially and psychologically. The only way to get the consumer supply and demand absorption process started again is for our government to create, adopt, and then mandate the implementation of new, revolutionary, state of the art, and management to prevent crisis Business Practices as quickly as possible. Accomplishing this will then result in the U. S. real estate market and overall economy stabilizing and gradually getting back on positive tracks as opposed to the negative ones they are currently on.
Very detailed information concerning 1) the real truth about the current devastating condition of the U. S. real estate market and overall economy, 2) reasons why America’s real estate market and overall economic financial crisis began, and most importantly, 3) solutions that will enable America’s real estate market and overall economy to get back on very prosperous tracks again can be found in my America's Financial Crisis Solutions Book. This Book is the first of 5 that comprise my U.S. Economic Crisis Solutions Training System.
Respectfully,
Phil Mitsch
America's Leading Financial Crisis, Real Estate and Mortgage Expert And Trainer
Real Estate Industry's All Time Top Producing Residential Realtor
Cherry Hill, New Jersey
856-665-6569
http://PhilMitschForAmerica.com
philmitsch@verizon.net
Special Note
All 6000 + of Phil Mitsch’s 1) U.S. Economic Crisis Solutions, 2) Home Buyer, 3) Home Seller, 4) Real Estate Professional, 5) Mortgage Professional, and 6) Life Lessons can be obtained in his 70 Books that comprise his 8 Training Systems. These Systems can be found at http://PhilMitschForAmerica.com.
Comments
Absorbing for 230 years. That is one big sponge!
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