Essentially the problem is the excessive concentration of liquidity with no real investment options .

The first aspect politicians should watch is the equilibrium offer / demand which is the basic aspect of economy .

The factor more strongly affecting that equilibrium is the distribution of liquidity which in fact is a direct function of the share of reachness somewhat measured by the GINI indicator .

The responsibility of politicians in keeping those equilibriums is the key of world economy progress and it is only too evident that the world is as it is because politicians have disregarded this during the last many years .

The instruments that should allow politicians to keep adequate balances in the distribution of reachness and there by in the distribution of liquidity , are taxes and rates as well as a sound credit policy at each time .

The tax and credit strategy should make sure that liquidity is widely stimulated into activities that produce higher added value technologies , processes and ventures …which will demand highly qualified workforce that will grab substantial incomes that will guaranty lasting and healthy consumption .

The continuity of large scale production such as car factories and other durable consumer products …depends on those actions . A decaying middle class in numbers and power purchase capacity …is the gate to world economic Armageddon .

Brahmason

Brahmason@gmail.com

Published in: on diciembre 7, 2012 at 11:33 am  Comments (22)  

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