A year ago I had dinner with with two Harvard undergraduates (blog posting). Over after-dinner ice cream they came up with what I thought was a wise and clever explanation for how the U.S. economy will recover: as times get tougher, Americans will start working harder. I checked back with them this evening, reminded them of what they’d said, and asked whether they were still optimistic about a U.S. economic recovery.
One of the undergraduates said “I do think that people would work harder, but there aren’t any jobs. I’m worried.” What about federal government deficit spending? “I’m predicting massive inflation and then Japan and the Chinese will have to invade.”
Significant events since February 2009: (1) his father has retired and found that the pension doesn’t keep up with inflation as well as advertised, and (2) Herrell’s, the ice cream shop where we heard his epiphany, went broke after 27 years in business.