Real Growth is Usually Slower Growth


A point I have made many times in my discussions on US economic growth: Real Growth is Usually Slow Growth (crazy internet companies excepted!).

Goosing growth with gimmicks like housing incentives, deficit spending, and such leads to overheated fake growth. Real growth comes from saving, investing, and growing through investments. I thought of that when I saw the founder of Clif Bars featured in this Wall Street Journal article by Michelle Wu:

Clif Bars

They had the opportunity to sell out, or receive outside financing to grow faster. They opted to fund growth with cash flow and now annual revenues have grown to 225M dollars. Steady growth based on investment is real growth which lasts – it’s unfortunate that our country still relies on gimmicks such as the 8,000 dollar tax credit to try to goose the real estate market. Instead, people should focus on working and saving and when the time is right, they will buy a house.