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Close Topic OptionsThe Second Great Depression
The Great Depression - Politics, Business, Civil, History - Posted: 17th Sep, 2008 - 10:56pm
Posts: 162 - Views: 24717
US Economy worst now than it was in the First Great Depression - what are your thoughts?The Second Great Depression
Some economists believe we are heading for a second Great Depression, or at the least the US economy will experience major inflation or deflation or recession. Here is the viewpoint of one man, known as a "Fractalist," Gary Lammert. He tracks and analyzes long-term patterns in stock market inexes, and his work is highly technical reading (be warned!).
QUOTE The Economic Fractalist
Non-Stochastic Saturation Macroeconomics
Is the macro economy at the brink of collapse? Most linearly thinking
economists do not believe so. The renown Economist Irving Fisher made
his linear prediction of continued growth a month or so before the
1929 primary decay.
The signs of early macroeconomic decay were present in the summer of 1929
with falling auto sales and falling exports. The debt burden and
forward consumption on credit of American workers at the end of the
Roaring twenties weighed against continued growth.
March 2006 parallels the macroeconomic conditions of 1929. The
unchanged linear thought processes of current renown economists are
following the same 77 year old echoes of their predecessors. The
nonlinearity characterized by fractal progression remains in the
darkness of the ante room, just out of sight.
The parallels are there. The current US economy is maintained on a
termite infested wooden foundation of gargantuan debt. The listed
ongoing valuation of assets are only as good as the continuation of
the promised IOU's of a new service worker class, whose jobs are as
tenuous as the economy they exist in. Anyone who can not conceive of a
coupled feedback unraveling of jobs and asset valuations, would do
well to study the devolution process in the early 1930's.
Is the global economy at that critical point? While no one really
knows and time will tell its story, long term fractal analysis
suggests that to be the case.
The Second Great Depression (Hover)
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Post Date: 12th Mar, 2006 - 6:19am / Post ID: #
Depression Great The
Allot of myths surround the Great Depression that started in 1929. As a result of these myths, many people, even experts, are always in fear of another Great Depression. While the market itself my look the same, all of the same indicators are not there outside of the direct credit amounts of people.
| QUOTE |
The 1929 Crash occurred even though: o There was no inflation in either commodity or industrial prices prior to the Crash. For example, steel prices proved extremely sticky in an UPWARDS direction. In 1929, they were only about 4% higher than their depressed 1922 levels despite the seven prosperous years before the Crash, and despite several periods when production ran near or even above 100% of rated capacity and unfilled order backlogs were at or near record levels. Indeed, because of productivity gains, steel prices, like those of autos and many other products, had a substantially DOWNWARDS bias during the prosperous periods of the 1920s. They declined from $60.60 per ton in the prosperous April, 1923, to $51.25 in the booming first half of 1929, with a low of $48.60 during the 1927 recession. o Merchandise inventories were at generally moderate levels except for autos. o Interest rates did move higher, but they were well below their 1929 highs throughout September, 1929. They broke substantially lower early in October, 1929, and declined rapidly thereafter. o The major banks and most of the smaller banks were financially strong. During the first half year after the '29 Crash, bank failures were confined to small banks at rates about average for previous 1920s slumps, and the first major bank failure didn't occur until more than a year after the Crash. o The nation had huge gold reserves, holding as much as $5 billion of the world's $11.3 billion of monetary gold. o The Federal Reserve Bank was strong and able to extend substantial assistance to national banks as needed by the system. However, many of the state chartered banks were in their usual parlous state. o Prices declined quickly under the influence of vigorous, ruthless market forces, which operated exactly as they were expected to in such conditions. Commodity and industrial prices were forced sharply lower, generally below post WW-I lows within the first year of the Great Depression - but the economy could not find equilibrium points at any depth. |
These facts show that many of the myths about the Great Depression are wrong. In fact, depressions have happened several times in the history of the US due to the instability of capitalism, but most can be recovered from with in a year or so. The reason the Great Depression continued for nearly a decade was due to many factors, one being the signing of the "New Deal" which did not help the economy as many think, but kept the US in its huge valley of depression nearly ten years longer than it should have.
https://www.futurecasts.com/Depression_mythology-I.html
| Offtopic but, If you want to know allot about the causes of depressions and recessions as well as suggested ways and current safe gaurds against them, check out the main site www.futurecasts.com |
Edited: konquererz on 12th Mar, 2006 - 6:21amThe Second Great Depression History & Civil Business Politics
The original Crash of the stock market was merely the beginning of the Great Depression. More was in play than just US interests. Global markets and foreign trade, tariff wars, international banks, and other international economic interests were all a part of it.
One thing that is not mentioned is that the government now quite aggressively "manages" the stock market to try to prevent another Crash (the Plunge Protection Team). But that's not going to prevent another Great Depression, in my opinion.
Yes, the US has had other depressions (and recessions and inflationary periods) that have all passed relatively quickly and quietly, in retrospect. However, none of this prevents another one to occur, and there certainly is no way to predict how severe another economic meltdown will be.
But think of this: The US economy has devolved from a producing, manufacturing economy to a service-driven economy. If another Crash occurs, and another economic unwinding, I think it will be harder to dig out from under because we don't produce anything of value anymore. We have way too many hairstylists and nail technicians who won't have a clue about doing anything else (even if there is an opportunity for it). Even our agricultural interests will have problems because the soil has been so overworked and overprocessed.
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Post Date: 25th Mar, 2006 - 8:48pm / Post ID: #
Depression Great The
I am amazed how long this has taken to realize on this board. The US is indeed heading for a depression. In fact, the market has behaved excatly like it did in 1915-1929. There was a boom in the 90s, a "bubble" which I believe was only a correction, and now it's rising again, the biggest rise in history is inevitable. Just look where the market is today, 11,279!
Not to mention the effect that the retirees will have on the market. They will be taking their money out of their IRAS which will cause the market to crash.
However, there are ways to profit from a market crash, if anyone is interested.
Post Date: 22nd Mar, 2008 - 10:36pm / Post ID: #
NOTE: News [?]
The Second Great Depression
Fears of deep recession
The turmoil produced wild swings on Wall Street this week, with the Dow Jones industrial average surging on Tuesday after the Fed aggressively cut a key interest rate, only to plunge on Wednesday on renewed worries about the economy and then to stage a 262-point gain on Thursday. Markets were closed Friday. More turbulence is expected in coming weeks because there remains a great deal of uncertainty about how many more victims the credit crisis will claim. The problems began last year with rising defaults on mortgages, as a housing slump intensified, but they have now spread to other parts of the credit markets, with institutions growing fearful about making other types of loans.
Ref. https://deseretnews.com/article/1,5143,695263698,00.html
Post Date: 17th Sep, 2008 - 6:49pm / Post ID: #
NOTE: News [?]
The Great Depression
Panic!
A spectacular loss of confidence in the safety of financial assets is creating an unprecedented event that strategists are calling "a huge wave of panic." Three-month U.S. T-bills are yielding 0.0304%, down from 1.50% on Monday as investors flock to the safest short-term assets. Leitao called the yield in T-bills "absolutely absurd". It means a $1,000,000 investment will pay $1,000,076 at maturity - far below the rate of inflation.
Ref. Source 2
TOPIC: The Second Great Depression