Helping Hands

Over the past three months, we have seen policymakers around the globe introducing massive economic stimulus packages, most notably from the United States and China in response to the rapidly deteriorating global economic outlook and tightening credit conditions. Some market watchers have criticised policymakers and regulators for taking a more reactive stance rather than being proactive and preventive and have argued that the timing of policy initiatives is as important as the measures themselves. Without the support of coherent and decisive policy initiatives, even companies with sound business models are facing cash drainage in today’s extremely challenging macro environment as economic activities plunge beyond any reasonable expectations.

As President Obama takes power, he is clearly aware of the urgency to put his recovery plan in place to break free from the “vicious cycle” where rising unemployment leads to reduced consumer spending and in turn more lay-offs. We remain hopeful that the recently approved USD 786 billion dollar stimulus package will be able to jolt the US economy back to life through hefty infrastructure investment and tax cuts. Echoing the words of President Obama, there is no perfect plan, but a failure to act decisively will only deepen this crisis.

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