Not a week goes by where a talking head doesn't bemoan the fact that Canadians (and/or Americans) are choosing to save and pay down debt instead of spending. Apparently keeping our own money is risky as it causes deflation, slows growth, affects GDP, reduces government income, causes autism, and makes earthquakes more frequent.
Wasn't it just 6 months ago that we were being warned that Americans and Canadians had record levels of personal debt? Wasn't a trigger for this recession massive defaults on mortgages people couldn't afford?
To keep the economy humming, consumers have to spend. For an economy to succeed it has to constantly grow. Growth is the only option. Worse than that, it has to grow quickly year over year. A retraction is a recession or a depression. Holding steady (or low growth) is called "stagflation". I love that, holding steady isn't a form of stability its stagnation.
The only option for an economy is rapid growth. Any other option is considered a failure.
But its not realistic. Economies can't grow forever. You either run out of money, resources or both.
Conclusion: Capitalism is a system designed to fail.
Am I wrong? How?