Tell me if my thinking on the economy is wrong

[ThomWV]

Let me try to sum up what seems to be the state of broken in the economy.

There have been massive frauds and abuses on one hand and then on the other hand there has also been a massive accumulation of private debt that makes it impossible for incomes to meet spending demands. The two are not the same thing but they are taking place concurrently.

If I'm seeing this right most of the work toward recovery that has been accomplished so far is to right the fraud and abuses. These are things that effect the financial system; or banks and the flow of cash and near cash instruments that are the lifeblood of our day to day activity. I think the Administration is doing what must be done in this arena and will continue to do what is required until things improve to some sort of normalcy.

The second problem is more vexing though. It may be that we have borrowed to the point that we can not pay back what we owe, a problem compounded by an ever-growing unemployment rate. As recent posts and articles about credit card companies hounding creditors past the grave show we have spent more than we can repay in our lifetimes in some cases. While Government spending programs can certainly be effective in halting the every-increasing unemployment rate it would seem that even with full employment there is no way we can pay back more than we earn in even the best of times. That's a quandary.

But maybe I've got this all wrong, thinking about the problem in two separate parts. Maybe I've got the parts wrong and maybe I'm just dead wrong all the way around. If that's so please make me smarter.