A downward slide in the performance of IT-related industries which are driving the economy has appeared and there is increasing instability on the stock market. An adverse effect can be expected if negative household savings become the norm and household balance sheets suddenly worsen due to a sharp drop in stock prices. There is growing risk of a downward slide.
Behind the high, inflation-free growth of the U.S. economy is a drastic cutting of costs, an elimination of "waste." A waste-free economy was created by reducing stocks, encouraging outsourcing, and introducing results-based wages, thereby reducing costs and increasing production at the same time. However, there was so much waste in the U.S. economy from the 1950s to the 1970s that it was often ridiculed as "the bureaucracy." In fact, this is another important opportunity for high, inflation-free growth, because it was possible to hold down costs surrounding increased production by eliminating "waste."
However, a world without "waste" is also a world without a shock-absorbing "buffer." When things are going well, everything progresses extremely efficiently and smoothly, but if multiple unforeseen situations occur, there is the possibility of a sudden crisis. The word "multiple" is important here. Even if the shock is great, provided that it is just one kind of shock, a "waste"-free organization can quickly grasp the problem and deal with it, but if there is more than one shock, without adequate idle resources to deal with them simultaneously, the result will be a plunge into crisis.
Compared with the age of "big ships and enormous guns" when there was a lot of waste in the U.S., it suggests a surprising weakness to multiple crises. I do not think that the present situation is one of "multiple unexpected negative factors," but attention must be paid to the accumulation of "systematic risk" when an explosive political risk capable of upsetting general expectations is compounded by economic risk.
