Was the advice given by our elders really right- Earn more, Spend less, save more for your bad days? With the advent of the “ feel good economy” the focus suddenly had changed. It now was “ Earn good, spend more speculating on your future income”. Nobody created that small nest for the bad days. And the result is very clear.
Be it individuals or the large corporates- everyone is facing the heat. The economy is just entering the recession mode and already most of large corporates are cutting jobs and costs. A few quarter of losses was so strong that it over wrote all the past many years profits. What happened to that huge amount of “ general reserve” that appear on the balance sheets of these companies.
What worries me the most is the plight of the young Indian employees loosing jobs. Already over burdened with the society pressure to own that “ big car” and “ big house”, all of them were carrying huge loans and finding it difficult to repay them with the increasing interest costs. Now with the entire global economy going for a toss and no social support available from the government, sustenance for quite a few of them might become difficult.
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