As the slowing US economy has many states worried about the future, the Midwest is singing a different tune. Thanks to low state income tax and improving business margins, Kansas has consistently outperformed many states in a number of economic benchmarks. Not only is our 4.3% unemployment rate the lowest it’s been in over 15 years, but it’s several standard deviations away from the national average of 5.5%.
State Financial Goals
On paper, it seems like things are going pretty well for us. In this economic environment, financial institutions are focused on one thing – invest. In order to see continued growth, access to finance needs to be made readily available. Angel investors, investment bankers, and private investors have already targeted the market heavily. But there is one sector that’s been neglected, and that’s the people like you and me. Compared to business, consumers are finding it hard to get access to quick cash loans and personal finance. But we can expect to see a reversal of this trend quite soon.
If the economy is doing so well, then why is it so important for consumers to have access to finance? The answer is actually quite simple. While our state is doing comparatively well, there are still some challenges that need to be addressed. Swift declines in cattle prices mean that farm income has dropped. The international oil markets are particularly disappointing, cutting off another steady source of income. In order to maintain continued economic growth, there needs to be a cash injection to allow companies to adapt to changing market conditions.
Why Consumer Finance is Essential
In any economy, money is only valuable when it changes hands. Imagine you go to work. After a long day, your boss hands you a $20 tip for a job well done. You use this $20 to grab a pizza for yourself and the kids. The pizza parlor then pays off his cheese vendor, who in turn uses it to put gas in their delivery vehicle. In a single day, one $20 bill has created $80 worth of economic activity. When money is provided to wealthy people and large businesses, it tends to just sit in the bank. But when it’s made accessible to the lower and middle class, the money tends to be used for things that benefit society. This creates economic activity for essential industries, ensuring that the population leads better lives.
An Indicator of a Bright Future
In many ways, Kansas has always been overlooked as one of the state’s major economic centers. For financial magazines, it’s more profitable to write about the incredible booms and devastating busts that happen throughout the country. But where Kansas beats them all is instability. When there is a shortage of money, it tends to all go towards supporting major businesses. But when things are going well, the best way to boost the economy is by stimulating the lower and middle class. When financial institutions announce plans to offer credit to those of us with poor or low credit, it indicates the financial markets faith that people will be able to pay the loans back. This one simple activity says more about our economy than the census ever has.