Are you too complacent?
Stay calm, but be aware that it is still a dangerous financial environment. Today, Microsoft laid off 5000 workers. The fact that this represents 6% of its workers is significant. The fact that it is the first time ever for Microsoft to do a round of layoffs indicates where we are in this downturn.
What it means to you is that no matter where you work, and what job you have, you could be unemployed tomorrow. Microsoft is not in a high risk industry. Layoffs in the real estate and auto industries are common and more are expected. Computer software is not a risky enterprise. It shows that we still have a long way to go on the way down.
If you prepare for bad times to occur until 2020, the only thing that can happen is that you will be in better shape if things turn around sooner.
Yesterday, our post titled “Who Cares When the Economy Hits Bottom” said:
- “What if the real, supportable home values are those which existed in 1999? Assuming that, when does the economy “rebound?” Or does it ever? And if the real level of the US economy is only that level, then everything that exists at levels above that need to be dismantled. In fact, that is what is happening now. For an individual, small business, or large corporation, the answer is to look at where the real economy is, and race to that point. Build your business, personal finances, and expectations around that point.” – Aware Brain 1/21/09
In announcing the layoffs today, Microsoft CEO Steve Ballmer said:
- “We’re certainly in the midst of a once-in-a-lifetime set of economic conditions. The perspective I would bring is not one of recession. Rather, the economy is resetting to lower level of business and consumer spending based largely on the reduced leverage in economy,” – Steve Ballmer 1/22/09
Maybe he reads the blog. 
This is not a recession, it is just the economy getting back on a true course.
What’s next? There are rumors that IBM may layoff 16,000 people soon……
