"Most of our assumptions have outlived their uselessness."
Sometimes it helps to take a deep breath and realize that what seems obvious may be as uncertain as a roll of the dice.
When I was 21, I landed a gig as a cub reporter for the New York-based music trade magazine Record World. On my first day, the owner, a no-nonsense guy whose preferred means of communication was banging on the office walls, showed me a desk and told me to start interviewing the up-and-coming recording artists who came through our doors. When I asked for guidance he said, "Just ask 'What's happening?' Their egos will take care of the rest." And then he returned to wall-banging.
First up was Ian Anderson of Jethro Tull. I was certain he'd be nice to me, since he wanted a favorable article, but before I could open my mouth to ask the big question, the rock and roll flautist began mocking me for wearing a sports jacket. (My training had not included the fact that everyone in the biz wore T-shirts and jeans.) All I remember about his answer to "What's happening" was his sneer.
Shortly thereafter, legendary A&R man John Hammond, discoverer of Count Basie, Billie Holiday and Bob Dylan, sent me a tape with a few songs by his new 21 year-old protégé. The music was phenomenal, and we quickly set up an interview. Unlike Anderson, this guy was friendly and sincere, and I wrote a glowing piece. Having grown up on "LonGGIsland," I naturally assumed he was Jewish and spelled his last name Springstein. It turned out that Bruce Springsteen was, as Hammond made sure to note thenceforth, a good Catholic boy.
Speaking of faulty assumptions, it was less than two years ago that the Dow hit 14,000, housing prices were booming and many forecasters were positive the good times would only get better. Who can forget those prescient books "Why the Real Estate Boom Will Not Bust -- And How You Can Profit from It" and "How to Build Wealth in Today's Expanding Real Estate Market" by David Lereah? If "Dow, 30,000 by 2008 -- Why It's Different This Time" by Robert Zuccaro wasn't optimistic enough, there was David Elias' "Dow 40,000: Strategies for Profiting from the Greatest Bull Market in History." "Dow 100,000: Fact or Fiction" by Charles W. Kadlec, which came down decisively on the side of "fact," plunged even further into the realm of the unhinged. Undoubtedly, someone somewhere just knew we were headed for "Dow 1,000,000."
Now the assumptive tide has turned, and the doomsayers are ascendant. Nobel Prize winner Paul Krugman, who's been warning of a depression at least since his 1999 tome "The Return of Depression Economics," now says we are well into "depression economics" and has duly updated his thesis with "The Return of Depression Economics and Crisis of 2008."
Then there's "The Coming Economic Collapse: How You Can Thrive When Oil Costs $200 a Barrel" by Stephen Leeb and Glen Strathy. The collapse part is right, but what's collapsed is the price of oil.
Naturally, last year's optimism has given way to its opposite. A CNN/Opinion Research Corp. poll conducted in October found that close to "six out of ten Americans believe another economic depression is likely."
The truth is, no one, including the "experts," can know what's next for the economy. In James Gleick's truly prescient 1999 book "Faster," he notes that the rate of change in our society increases ever more dramatically as new technological developments like the Internet and the 24-hour cable news cycle shift the landscape.
So it is with the rate of change of our "assumptions." We need to act swiftly to reduce the enormous suffering the current financial crisis has wrought. But let's breathe deeply and temper our assumptions about how bad it will get or how long it will last. Failing that, just ask "What's happening?"