Saturday, April 27, 2013

The Demand Economy, or Lack Thereof

Supply side economics. Austerity. Cutting our way to prosperity. The perpetual application of the Laffer Curve.

All bullshit.

But you knew that already, right?

Corporate America may finally be catching up to this novel idea. One that was so novel that it dates back at least as far as Henry Ford.

The money quote, if you find this article too long to read:

Freeze says that revenue presents a more accurate picture of Corporate America's health. "You can play with the earnings numbers and have them skewed," he says. "But you can't mess with the revenue numbers - they are what they are. If people are not coming in droves to buy your products, your revenue's going to miss even if your earnings beat projections."

Demand based economies. How do they work again?