What Exactly Are The Fundamentals Of The U. S. Economy And How Do They Affect It
From my perspective, there are 6 Fundamentals that the U.S. economy is founded on. Depending upon whether they are increasing or decreasing, the economy will either grow and prosper or deteriorate. Now, before I explain the impact of them increasing or decreasing, I want to list for you exactly what the 6 Fundamentals that I am referring to are.
Consumer Disposable Income
Real Estate Ownership
Real Estate Values
Real Estate Equity
The 6 Fundamentals of the U.S. economy function in a chronological domino ripple effect sequence. Whichever direction the first fundamental goes the other five will follow as a result of a chain reaction. If the first one increases the other five will also increase. If the first one decreases the other five will also decrease. Now let’s see exactly how this domino ripple effect sequence affects the U.S. economy.
The Positive Domino Ripple Effect Sequence Formula
When the 6 Fundamentals of the U.S. economy are increasing it will result in the real estate market and overall economy moving in a positive direction. Now here’s the positive domino ripple effect sequence formula that has enabled the U.S. real estate market and overall economy to grow, prosper, and remain relatively healthy for approximately the first 228 years of our country’s history.
1. An increase in Consumer Disposable Income led to
2. An increase in Consumer Borrowing that led to
3. An increase in Consumer Spending that led to
4. An increase in Real Estate Ownership that led to
5. An increase in Real Estate Values that led to
6. An increase in Real Estate Equity
The above positive domino ripple effect sequence formula represents the existence of what I refer to as the traditional 90%-10% economy meaning that approximately 90% of Americans and their businesses are doing well financially and psychologically each year and only about 10% of them are not doing well.
The Negative Domino Ripple Effect Sequence Formula
When the 6 Fundamentals of the U. S. economy are decreasing it will result in the real estate market and overall economy moving in a negative direction. Now here’s the negative domino ripple effect sequence formula that has caused the U. S. real estate market and overall economy to deteriorate both very badly and very quickly since late 2004 and early 2005.
1. A decrease in Consumer Disposable Income has led to
2. A decrease in Consumer Borrowing has led to
3. A decrease in Consumer Spending has led to
4. A decrease in Real Estate Ownership has led to
5. A decrease in Real Estate Values has led to
6. A decrease in Real Estate Equity
The continuation of this negative domino ripple effect sequence formula will lead the United States into an 80%-20% economy, then a 70%-30%, then a 60%-40%, then a 50%-50%, then a 40%-60%, then a 30%-70%, then a 20%-80% and then, ultimately, into a 10%-90% economy. Many people feel that the U.S. is already in a 30%-70% economy here in the year 2014 as a result of massive real estate market and overall economic deterioration since the year 2005. The bottom line is simply this. If this negative domino ripple effect sequence formula continues, the U.S. real estate market and overall economy will continue to deteriorate very badly and indefinitely. This is exactly why the conceptual secret to U.S. real estate market and overall economic recovery is to get all 6 Fundamentals increasing again very quickly. Only new and revolutionary Federal legislation and corporate business practices can accomplish this.
Remember to look for my Economic Tips For August 2014 article in about four weeks.
Agents’ Note: Phil Mitsch is the world's #1 economic recovery, real estate, financial and motivation trainer. He is also the real estate industry’s all time, top producing residential resale Realtor, who did not use personal assistants. His 1) biography, 2) testimonials, 3) seminar topics, 4) books, 5) videos, 6) audios, 7) economic recovery tips, 8) real estate tips, 9) financial tips and 10) motivation tips can be found at www.PhilMitschForAmerica.com. His tips can also be found online at www.examiner.com/real-estate-in-national/phil-mitsch and @PhilMitsch on Twitter. For further information, contact Phil Mitsch Enterprises in Cherry Hill, New Jersey at 856-665-6569 or by email to email@example.com.