Mr. Lamonica gets Ditched for his unrealistic assessment on how to jump start the economy. He mentions that businesses should be the first to take a leap of faith and start hiring. However, he fails to explain what those new employees would actually be doing. There needs to be a demand for some good/service before any production and hiring can be justified. Why should a company be forced to increase their inventories (goods or talent) in hopes that someone will magically surface to purchase it? True, in order for demand to increase, the typical American consumer must find themselves in possession of a new found disposable income. However, does that mean that companies should hire new employees with the hope that collective new hires throughout the economy will increase demand for their goods/services and these new employees will still have justifiable jobs in a few months? Or, would the more logical approach to increasing disposable income and, ultimately, demand for goods/services be to increase the wages of current employees? This would allow businesses to truly build the demand before hiring staff to fulfill it. Mr. Lamonica's approach could ultimately mean the hiring and firing of the same individual's when the demand that would necessitate those individual's never came to fruition. True, businesses should be looked to in making the first step, but let's not put the cart before the horse.
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