Business
The Sun News
Saturday, Jul. 25, 2009
Recession eerily reminiscent of Great Depression
http://www.thesunnews.com/business/story/996537.html
Financial institutions helped develop consumer credit in the 1920s, as postwar prosperity raised the standard of living and old ideas about the burdens of debt quickly disappeared. Americans became so enamored of credit and layaways that many couldn't survive without them.
Of course, the Great Depression eventually changed that.
Sound familiar?
"There's a very odd and overwhelming parallel between what's happening now and the aftermath of the 1929 stock market crash," said Charles R. Geisst, author of the recently published "Collateral Damaged."
"Credit in both time periods was vastly overextended, leaving the deflated consumer unable to keep the momentum going and a depression or recession to immediately follow," he said.
Geisst's book tracks the history of credit, which he said grows as wealth increases and the political environment allows for easier borrowing, maybe even encouraging debt. He also details what he calls "cannibal consumption," or eating away at one's own equity by taking out a loan on a home to pay off credit card debt.
The average American household carries more than 13 credit cards, and more than 6,000 different types of cards are presently on offer - suggesting that the credit phenomenon is more than just a trend, Geisst said.
"There's a connection between consumer spending and economic markets that eventually bust under certain conditions," he said. "Right now we'll see a slowdown in spending that will put us back on the track the U.S. was on in the 1950s and 1960s. We can see that these problems are cyclical."
HONEY, I'M HOME
Stress more of a factor for married couples
Being out of work is stressful. Being married may make those worries weigh even heavier.
Unemployed husbands and wives recently surveyed noted experiencing stress more often than single job seekers, 81 percent to 51 percent respectively.
The poll of 2,261 U.S. adults, conducted by Harris Interactive on behalf of employer information Web site glassdoor.com, also found that more than a third of employed and unemployed respondents said job stress associated with work or finding work caused physical or emotional symptoms such as anxiety, insomnia and high blood pressure.
The highest rates of stress were reported among those between ages 35 and 44, while two out of three said the stress affected other areas of their lives. Nearly 40 percent of job hunters said it hindered their personal relationships with friends and family, while almost a quarter said work-related stress had an impact on their relationships as well.
"Especially during an economic recession, many are scared to death that they'll be out in the open job market," said Rusty Rueff, career and workplace expert for glassdoor.com. "Dealing with your worries and then those same worries of your spouse can feel like the weight of the world on your shoulders, so it makes sense the number is so much higher for those in a marriage or with a family."
The Harris Interactive poll was conducted in the United States between June 22 and June 24.
The Associated Press
The Sun News
Saturday, Jul. 25, 2009
Recession eerily reminiscent of Great Depression
http://www.thesunnews.com/business/story/996537.html
Financial institutions helped develop consumer credit in the 1920s, as postwar prosperity raised the standard of living and old ideas about the burdens of debt quickly disappeared. Americans became so enamored of credit and layaways that many couldn't survive without them.
Of course, the Great Depression eventually changed that.
Sound familiar?
"There's a very odd and overwhelming parallel between what's happening now and the aftermath of the 1929 stock market crash," said Charles R. Geisst, author of the recently published "Collateral Damaged."
"Credit in both time periods was vastly overextended, leaving the deflated consumer unable to keep the momentum going and a depression or recession to immediately follow," he said.
Geisst's book tracks the history of credit, which he said grows as wealth increases and the political environment allows for easier borrowing, maybe even encouraging debt. He also details what he calls "cannibal consumption," or eating away at one's own equity by taking out a loan on a home to pay off credit card debt.
The average American household carries more than 13 credit cards, and more than 6,000 different types of cards are presently on offer - suggesting that the credit phenomenon is more than just a trend, Geisst said.
"There's a connection between consumer spending and economic markets that eventually bust under certain conditions," he said. "Right now we'll see a slowdown in spending that will put us back on the track the U.S. was on in the 1950s and 1960s. We can see that these problems are cyclical."
HONEY, I'M HOME
Stress more of a factor for married couples
Being out of work is stressful. Being married may make those worries weigh even heavier.
Unemployed husbands and wives recently surveyed noted experiencing stress more often than single job seekers, 81 percent to 51 percent respectively.
The poll of 2,261 U.S. adults, conducted by Harris Interactive on behalf of employer information Web site glassdoor.com, also found that more than a third of employed and unemployed respondents said job stress associated with work or finding work caused physical or emotional symptoms such as anxiety, insomnia and high blood pressure.
The highest rates of stress were reported among those between ages 35 and 44, while two out of three said the stress affected other areas of their lives. Nearly 40 percent of job hunters said it hindered their personal relationships with friends and family, while almost a quarter said work-related stress had an impact on their relationships as well.
"Especially during an economic recession, many are scared to death that they'll be out in the open job market," said Rusty Rueff, career and workplace expert for glassdoor.com. "Dealing with your worries and then those same worries of your spouse can feel like the weight of the world on your shoulders, so it makes sense the number is so much higher for those in a marriage or with a family."
The Harris Interactive poll was conducted in the United States between June 22 and June 24.
The Associated Press
