The Next Great Depression Is Here... If We're Lucky
Don't panic — this is just a speed bump. You want to ride this one out. Think long-term. It's a marathon, not a sprint. Keep your money where it is — trust the market. The worst thing you can do is panic.
Reassuring words, which can all be traced, ultimately, to the same dudes who ringed our noses and walked us to the edge of this particular ravine in the first place. The Dow is literally in freefall as we speak, plunging beneath a five-year-low, with no bottom in sight. So here's my open question: Are you guys sure we shouldn't panic?
You know, not that we don't trust you absolutely anymore.
I, for one, think this is an excellent time to panic. I'm strongly considering curling up in the corner over there and rocking like a freaked-out autistic kid.
The challenges we face as a nation grow more complex every day, and every day, America's superstrength weakens. Our financial institutions — the only corner of industry we haven't already sent overseas — are imploding. Every day our political process grows more absurdly corrupt, while our watchdog media slumbers, dreaming of Britney. Our families are virtually all fractured; our prisons are teeming; our schools are churning out violent morons.
How bad does the state of the nation have to get before we will be advised it's okay to panic?
Collectively and individually, we are already enslaved to a diminished future by decades of unrestrained gluttony and greed. And we are getting fatter, stupider, and more indebted by the moment. I'm not being judgmental; that's just a sober read of the stats. One in five Americans today believes the sun revolves around the earth. One in four read no books at all last year. One in three believes in UFOs.
Kind of makes you wonder who we are, anymore. I think we've been bellied up just a little too long at the all-you-can-eat buffet of the world. You probably think I mean that figuratively. But one out of five Americans is overweight now, and one in four of us is clinically obese. Yowsa! One in four!! We are not just the fattest people on Earth, we're the fattest people in the history of people. We're so fat our favorite color is gravy. We're so fat that when our beeper goes off, other countries think we're backing up.
But I digress.
Time to put two and two together, people, whatever THAT adds up to, and take a good hard look at what we've let ourselves become. Not too long ago, America led the world in things like energy production, automobiles, cotton, hope. Today we lead the world in substance abuse, incarceration, bulimia, and serial killers. America's #1 export today is — this is true; can anyone guess?
Debt.
As esteemed philosopher Dean Wormer of Faber College once noted, "Fat, drunk, and stupid is no way to go through life." Yet here we are, living that immature dream, inspiring nobody.
When you're driving as fast and recklessly as you can, a 'speed bump' is quite sufficient to wreck a car. I say it's time to panic. And rejoice. Because things are going to get a hell of a lot worse before they get better. And that may be exactly what this country needs.
The Great Depression was no barrel of laughs, by all accounts. Poverty, despair, unemployment, hunger, and hopelessness are harsh mistresses. But in retrospect, they raised us right. The Depression built character on a national scale, taught us virtues like self-reliance and sacrifice and compassion, brought families together. Roll your postmodern eyes at the quaint earnestness of it all, but it truly did make our nation strong.
And just as the Great Depression brought out the best in us, our postwar prosperity has surely brought out the worst. Our blissful blinkered indolence has left us thoroughly unprepared for the challenges of the new millennium, challenges which couldn't be more immediate or acute. Iran is twenty-two seconds from becoming a nuclear power. Russian warships are steaming toward Venezuela, literally, as you read this. And here, right at the moment when we could really use the Greatest Generation, we find ourselves armed with...the Me Generation.
D'oh!
I modestly propose that a new Great Depression is exactly what America needs to wake ourselves up, put some moral fiber back in our diet, and give us some breathing room so we can catch up to the rest of the world again. We got ourselves into this mess, and it's high time we got ourselves out, by deliberately provoking a painful and protracted worldwide financial calamity. We did it to them in 1929, and by God we can do it again.
It shouldn't be that hard... These are fragile times, and information moves at the speed of light, and we have the herd effect on our side. Does anything seem unsinkable this week?
Consider this scenario: A local TV pundit half-jokingly suggests, after some next bit of bad financial news, that maybe we'd better pull our money out now, before all the ATMs stop working. A few people take him seriously; they tell their Facebook friends. A news chopper films the line forming outside some local bank; Fox News picks it up for the national feed, and next thing you know your spouse is calling you at work, saying 'Honey, they are closing banks and there's cops everywhere..."
The FDIC 'insures' your $3 trillion in consumer deposits with just $45 billion in assets...that's just one and a half cents per dollar. Won't take much to empty that box — WaMu alone was projected to cost the FDIC $24 billion, so you do the math. Math is hard! The FDIC will have to take the collection plate to Treasury, who'll have to go to China, who'll tell us to screw off. Or to turn the other way while they take Taiwan out back for a beatdown.
There's no question in my mind that America can be strong and resourceful and self-reliant again. But it's going to take an actual catastrophic system failure to drive those lessons home. Sure, maybe we can heed this 'dress rehearsal' warning and wise up and put ourselves back on track, but the smart money's on no fricking way. You know us; we're going to fall right back into our crack-addict habits as soon as the credit lines open up again. There are just too many suits in cahoots working to keep us spellbound, too little in the way of countervailing force. Brace yourself to resist the messaging this winter, as retailers try to shore up The.Worst.Christmas.Season.Ever.
You know what'll probably make you feel better about this whole thing? A new iPod Touch. Click here to buy it right now, and make no payments for the first six months!!
I'm not saying a new Great Depression is definitely coming, I'm just saying put what's left of your money in a mattress, plant apple trees in your backyard, and buy a gun. And bullets — don't forget bullets! To be first in line for the run on a bank is irresponsible to your country. But to be last in line is irresponsible to your family.
Don't let anyone tell you to relax...That's how they walked us off the cliff in 1929. Embrace your fear. Fear makes you smart; fear makes you strong. It's the only proper mindset to face the coming storm. In fact, why not practice? As an experiment, try to live within your means, just for a week. Buy only some things you absolutely don't need, and try eating only 50 or 60% more than your body can possibly process. Put a couple of dollars in a box and see if they're still there at the end of the week. Try it! Just for fun!
The only thing to trust is fear itself. Because the reality is, if we all choose to get a little leaner and hungrier, it might not hurt quite so bad later this year or early next year, when that choice is taken from us.
Follow Keith Blanchard on Twitter: www.twitter.com/KeithBlanchard
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Looking at "the numbers," I might agree with the notion that "the sky is falling." But... numbers don't tell the complete story of anything.
In fact, we've all been looking WAY too much at "numbers." We have been exporting "numbers," instead of building and exporting "things." We have been huckstering businessmen in other nations around the world (and, in our own...) with what turn out to be "worthless securities
But you know... this is still a huge nation with 300+ million people in it, gobs of natural resources, railroads everywhere, and tens of thousands of for-the-moment shuttered factories. Our people don't just want to "live," but to "live well." And, if industrial production will only be restarted WITHIN this country, you've got "the means of production" and "the eventual consumer" within only a few hundred or maybe a few thousand LAND-miles from each other.
It worked, all the way up to around the 1960's. That was not-too-many years ago. It will work again.
Why don't we resurrect "Rosie the Riveter" and "Uncle Sam?" There really isn't time to wring our hands and whine. Throw out the accountants who always looked for "the lowest price" and get some businessmen in here. Any grandfathers out there who want to be consultants?
Rosie the Riveter, Uncle Sam, and businessmen, huh? Got war? Make a profit!
Hay Keith! Great article. Not much more to say is there?
That's what I'm talkin' about! Thankyou.
The truth is, the economy has already corrected majorly for this recession. It doesn't need to go down any further, and shouting "FIRE!" is the irresponsible thing to do.
The 'Titantic' is going down for the second time, and the the republicans hand the wheel to Obama, like it was a gift! You think this wasn't planned!?
It depends how long the gash is below the water line.
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This 5 part series is quite useful.
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I have been studying this situation for seven months.
It is far, far worse than anyone is saying.
The CDO's and CDS's are financial AIDS. There is no other way to describe it.
What these guys on Wall Street did with the CDS's was amazing! It was so far beyond criminal that I think we will have to invent an entirely new word to describe this kind of cosmic irresponsibility and incredible lack of accountability by the CEO's on Wall Street !
"buy a gun"
You are NOT funny. You are insane.
No, he is correct. His only error was to say to buy bullets too. He should have said cartridges.
Bullets are the projectiles that come out of the barrel. Unless you can hand load, or reload, they are useless.
There's no point in buying guns as long as *THEY* won't let you shoot the ones who need shooting.
This is exactly the kind of post we need now....not
Yeah, please. Bad words hurt my ears. Stroke my forehead instead and whisper,"E
What do UFOs have to do with it? I guess if you've SEEN one you realize its not stupid. The sun revolving around the earth and refusing to read, those are scary statistics.
Agreed, UFO's are as inevitable as was Columbus' arrival in the Caribbean. Something like 300 confirmed extrasolar planets as of this month. Probably some creatures out there on one. Maybe, gasp, more intelligent than us...
"Fat, drunk, and stupid is no way to go through life."
No, but if you pick just two of these you might be almost fine. And with one alone you can even live a productive life.
And I can almost agree about the rest, minus the gun and bullets. In a gun fight only the man survives who knows how to use that thing... and that's usually not the man who bought it for defense. The only way to actually get out of it alive for sure is to avoid it.
You do realize that NONE OF US is going to get out of here alive?
Iran is twenty-two seconds from becoming a nuclear power. Russian warships are steaming toward Venezuela,: So what?? What is Iran going to do with its one or two nuclear weapons? send them by missile to Israel or Europe? or possibly send them to US via terroists. Nuclear explosion residue can be traced to its source. So if a nuke goes off in USA then I would suspect Iran would cease to exist ( and its oil fields) in about 30 nanoseconds after the blast in USA ( read Wildfire by DeMille). Do you think the Iranians , who haven't started a war since Xerxes invaded ancient Greece would be that stupid???? . You have bought off on a typical repug fear factor. Putin sending a warship to Venezuela. so what? we Send warships to Georgia . Why should the USA with its dictator like present Executive department and its preempt Bush Doctrine ( backed by forged letters (Ron Suskind) and Geneva Convention terrorist activities (waterboard)) be considered "better" than Putin?
Very well said. How can anyone be so dumb as to believe that Iran, with a few nukes, would attack Israel which is thought to have more than 200 nukes, or the U.S. which has 10s of thousands?
Well, on the other hand, they did vote for Bush two times.
Well, the Republicans are flushing us all down the toilet and almost 50% of the voting public still hasn't figured it out and probably never will. Greenspan will NEVER admit that he had his hand on the toilet handle and pulled the chain and NOT ONE Republican pundit or think tank will ever stand up and say THEY ruined the dream for all of us.
Yep, it's gonna be a hard long road for the next Pres!!....
The man writes sense. He's experienced beyond his years. He is fated to be the one selling tangerines at the South Ferry. Selling apples on Wall St will be risky with all of the Yuppies jumping from windows 24/7.
I sold out 3 years ago, moved to Canada and downsized just so I could get by selling pencils on the corner. I guess it's about time to stock up on # 2s........
I couldn't agree more that this is a diet the leading industrial nations desperately need. A lot of countries should thank their lucky stars that it's happening now, before they get as fat as the United States.
This could have been seriously funny satire, however, had you not impugned yourself with comments like:
"America led the world in things like energy production, automobiles, cotton, hope."
Considering they went on to lead the world in energy usage and short-sighted transportation policy, and the fact that cotton-picking slaves hoping to be free one day certainly boosted that category, I'm not so sure I'd be touting any of these in your Proud American History Chapters.
"The Great Depression was no barrel of laughs, by all accounts."
Buster Keaton, Mae West, W.C. Fields, Laurel & Hardy, The Marx Brothers, all enjoyed peak success and made many otherwise financially strapped folks laugh an awful lot; heck, even Chaplin did City Lights and Modern Times during this period. Even Our Gang began with their talkies in '29.
"One in five Americans today believes the sun revolves around the earth. One in four read no books at all last year. One in three believes in UFOs."
If you're so literate, how could you be ignorant of massive case files of witnessed flying objects which have yet to be identified.
>case files of witnessed flying objects which have yet to be identified
Case files aren't quite the same thing as UFO's.
BTW, ever notice how UFO sightings dropped off after the advent of videocameras?
You're amazingly eloquent for a UFO proponent, btw :)
Science is drawn from data. Quantum physics, I suppose, is bunk because of the lack of video evidence?
There are videos of UFOs, and more to come. Check out the Disclosure project. They have over 400 credible witnesses, and their testimony is compelling. UFO does not mean space aliens, by the way, if they are made on earth we need to know that, too. Any country who could mimic an alien invasion would have a tremendous power to terrorize the planet.
Oh, UFOs exist. I have seen a bunch of them myself. A couple on the plane, one or two on the ground. Some at night and some at daytime.
But thanks to my physics education it never took me more than thirty minutes to figure out what the physical explanation for what I saw was. And this is not counting the numerous effects that I had figured out in seconds.
So then those UFOs turned into IFOs (Identified Flying Objects) or a IOEs (Identified Optical Effects).
Consequently every single one of your cases in those massive files is simply a non-physicist who failed at solving a little riddle that nature gave them. UFOlogy is the equivalent of making a mystery out of the wrong solutions to the New York Times crossword puzzle.
:-)
You clearly aren't familiar with "every single one" of those case files (how could anyone be?). Extrapolating your experience as a scientific basic to preclude that of "every single" other witness is the height of arrogant ignorance. I'm not talking about UFOlogy.
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