Great Depression II (2000-201?)
- Thread starter andrasnm
- Start date
A good read is John Mauldin's "muddle-through" economics at www.frontlinethoughts.com
That's a definite possibility, although a highly immoral one, if done without financial hardship. I'd also question how many boomers could actually elect this; it's not an insignificant step. I think the average Jane and Joe still have enormous emotional and philosophical hurdles to overcome that make even consideration of bankruptcy wholly outside their paradigms today.
That said, I concur that there are those who would find doing so attractive, particularly in states where the primary residence and IRS/401K's are wholly exempt from a Chapter 7 liquidation.
As this thread started by positing the conditions required for a meltdown, it's also probable that more people would be able to justify walking away from all their unsecured debt as they reign in their lives to weather that sort of disastrous environment. In a purely survival mode, many traditional rules of conduct become exempt from what we normally consider civilized, moral behavior (such as repaying one's debts, the foundation for which IS the credit industry).
Full bankruptcy is a protected Right under the U.S. Constitution, thus my interest in recent attempts to "tweak it" -- just as there have been recent successes, upheld by the Supreme Court, to change the definition of other traditional, and what had been supposedly sacrosanct, Rights (e.g. McCain-Feingold).
Interesting point you raised.
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When depressions come they are because NOBODY see's them coming.
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Well, I would say that generally stock market crashes by themselves don't cause depressions, however they can be the catalyst. Or in the case of the Great Depression, the stock market crash did some decent damage but the true damage was caused by other policy errors such as trade barrier increases, monetary policy too tight, huge new regulations, spending and taxes, etc. (they somehow did every bad policy you can think of at once).
Believe me, if we had increased our tarrifs from 2% to 50% a few years ago we would be in a Depression right now too. Instead, the NASDAQ crashed 70% and caused a mild recession that we have already bounced back from. If anything the government + fed successfully did the exact correct policies to counteract the effect (namely go into a deficit + loose monetary policy + not mess up other things too much) in the short term.
One might successfully be able to argue the gov + fed focused *too much* on the short term-- ie they should have done nothing, and our recession would have lasted another year with another million job losses-- but in turn it would have wrung out some of the debt excesses thus possibly preventing a future depression which is much worse. Ie lose 1 million extra jobs now rather than risk a 10 million job loss 5 years from now.
Unfortunetly politicians, feds, + people as a whole I'd say are just too impatient-- it is always "are we skyrocketing now?" "are we skyrocketing now?"
Even though even with an extra 2 million job losses our unemployment is WAY lower than Europe and even better than our 20-year average that is still not enough for many people
In fixing one "problem" people create other worse ones. It's almost like when people take one medicine and it causes a bad side effect, so they add a 2nd medicine to fix the side effect and a 3rd to fix the 2nd's side effect and next thing you know they are taking 20 pills and they would be better off not taking any medicine.
Same situation here Our citizens demand fast responses and so the government makes decisions focus on the short term. Hense they successfuly steered us out of the NASDAQ damage but aren't focusing on long-term problems like our 2% savings rate and Social Security.
I won't complain too much because going 1 for 2 is better than what govt + fed usually bat at.. normally they screw up the long-term + short-term, at least this time they got one right
-Taric
When depressions come they are because NOBODY see's them coming.
=====
Well, I would say that generally stock market crashes by themselves don't cause depressions, however they can be the catalyst. Or in the case of the Great Depression, the stock market crash did some decent damage but the true damage was caused by other policy errors such as trade barrier increases, monetary policy too tight, huge new regulations, spending and taxes, etc. (they somehow did every bad policy you can think of at once).
Believe me, if we had increased our tarrifs from 2% to 50% a few years ago we would be in a Depression right now too. Instead, the NASDAQ crashed 70% and caused a mild recession that we have already bounced back from. If anything the government + fed successfully did the exact correct policies to counteract the effect (namely go into a deficit + loose monetary policy + not mess up other things too much) in the short term.
One might successfully be able to argue the gov + fed focused *too much* on the short term-- ie they should have done nothing, and our recession would have lasted another year with another million job losses-- but in turn it would have wrung out some of the debt excesses thus possibly preventing a future depression which is much worse. Ie lose 1 million extra jobs now rather than risk a 10 million job loss 5 years from now.
Unfortunetly politicians, feds, + people as a whole I'd say are just too impatient-- it is always "are we skyrocketing now?" "are we skyrocketing now?"
Even though even with an extra 2 million job losses our unemployment is WAY lower than Europe and even better than our 20-year average that is still not enough for many people
In fixing one "problem" people create other worse ones. It's almost like when people take one medicine and it causes a bad side effect, so they add a 2nd medicine to fix the side effect and a 3rd to fix the 2nd's side effect and next thing you know they are taking 20 pills and they would be better off not taking any medicine. Same situation here
Our citizens demand fast responses and so the government makes decisions focus on the short term. Hense they successfuly steered us out of the NASDAQ damage but aren't focusing on long-term problems like our 2% savings rate and Social Security. I won't complain too much because going 1 for 2 is better than what govt + fed usually bat at.. normally they screw up the long-term + short-term, at least this time they got one right
-Taric
NOBODY ? Of course there are SOME that see it coming,
it's rather the HUGE MAJORITY DON'T WANT TO SEE IT THAT IS COMPLETELY DIFFERENT !
Anne Williamson for example on worldnetdaily whose editor said "one of the world's most knowledgeable experts on the International Monetary Fund and the World Bank"
http://www.worldnetdaily.com/news/article.asp?ARTICLE_ID=22824
WorldNetDaily.com
I've never been more proud of any piece of journalism than I am of this month's cover story in WorldNet magazine, the offline companion to WorldNetDaily.com.
Written by Anne Williamson, one of the world's most knowledgeable experts on the International Monetary Fund and the World Bank, it tells a fantastic but true story of money and power and the way these institutions adversely affect the lives of millions and threaten the financial and personal security of every American.
Most people don't understand this story. Most people don't have a clue as to what the IMF and the World Bank are. Most people don't know anything about the way they threaten the interests of average Americans.
I never understood it myself until I read Anne Williamson's extremely insightful piece in WorldNet Magazine this month.
http://www.financialsense.com/Experts/2001/Williamson.htm
Anne Williamson, Contributing Writer, WorldNetDaily.com
"The Fed: How your money - and life - are controlled by America's banking system"
http://realmedia.cts.com/ramgen/crash/jpuplava/netcastdaily/radioexperts/050201.rm
http://realmedia.cts.com/ramgen/crash/jpuplava/netcastdaily/radioexperts/092601.rm
http://realmedia.cts.com/ramgen/crash/jpuplava/netcastdaily/radioexperts/061201.rm
it's rather the HUGE MAJORITY DON'T WANT TO SEE IT THAT IS COMPLETELY DIFFERENT !
Anne Williamson for example on worldnetdaily whose editor said "one of the world's most knowledgeable experts on the International Monetary Fund and the World Bank"
http://www.worldnetdaily.com/news/article.asp?ARTICLE_ID=22824
WorldNetDaily.com
I've never been more proud of any piece of journalism than I am of this month's cover story in WorldNet magazine, the offline companion to WorldNetDaily.com.
Written by Anne Williamson, one of the world's most knowledgeable experts on the International Monetary Fund and the World Bank, it tells a fantastic but true story of money and power and the way these institutions adversely affect the lives of millions and threaten the financial and personal security of every American.
Most people don't understand this story. Most people don't have a clue as to what the IMF and the World Bank are. Most people don't know anything about the way they threaten the interests of average Americans.
I never understood it myself until I read Anne Williamson's extremely insightful piece in WorldNet Magazine this month.
http://www.financialsense.com/Experts/2001/Williamson.htm
Anne Williamson, Contributing Writer, WorldNetDaily.com
"The Fed: How your money - and life - are controlled by America's banking system"
http://realmedia.cts.com/ramgen/crash/jpuplava/netcastdaily/radioexperts/050201.rm
http://realmedia.cts.com/ramgen/crash/jpuplava/netcastdaily/radioexperts/092601.rm
http://realmedia.cts.com/ramgen/crash/jpuplava/netcastdaily/radioexperts/061201.rm
Quote from Samson77:
Interesting point of view I agree that everything you've stated is possible but there is one problem.
When depressions come they are because NOBODY see's them coming.
So barring any major catastrophy this will probably not pan out as you have stated.
IMO.
2000-201? CANNOT BE THE DEPRESSION PERIOD, it is AFTER that it should come because demography will worsen after that period and stock market and above all economy fundamentally follows demography.