Do you think there could be a second Great Depression?

[jamespowers]

Absolutely. But that sort of thing most directly affects old poots like me who are nearing retirement. Younger folks will feel the effect more directly when they try to get a loan for their home or car (or whatever) and find that credit is much less easily obtainable than before..and could soon be almost impossible to come by.

AF

And if they do get credit it will most assuredly cost much more in terms of the interest rate.
Oh and it also effects younger guys like me who have their retirement money invested in equities for the future.:eusa_doh:

 

[jamespowers]

They'll be gone before long. And in this day and age, you'd probably get nabbed for hunting without a permit and lose your rifle.

I've already recruited a friend and we've discussed using my Ruger 10/22 and Winchester 410 to get rodents, should the need arise. But it will have to be quick and quiet. He has kids, and my sister has kids, so I figure if times get hard enough, one of them will need food and I may as well offer my services up.

Let them try to nab me.
I'll use my Benjamin Pump pellet gun.

 

[Kabel]

I'm going to voice my opinion on this after trying to leave it alone as long as possible.
It was made clear that the main-investors and banking families had a lot to do with the first great-depression. Now i'm not going to bore everyone with all the details, but it was them who started the entire panic purposely and ended up profiting massively on it.
The situation at this very moment is starting to look familiar. There are ofcourse other factors that come into play, but again this is a moment where the United States is financially very unstable on a government level due to massive spending. You see all these investors panic en stocks drop like leaves in autumn and I'm just not trusting it. I have this feeling that we are being played with once again. It's so strange that fashion isn't the only thing that goes away and comes back. Apparently the common people being screwed comes round every once in while too.
Bottom line for me is that I don't trust this whole situation for sh**. It's just a game for the few who have most of the money while we're trying to grab scraps of a plate from one another.

 

[dhermann1]

The debt issue is definitely valid. Americans' saving rates have been too low for a long time. But there are other factors at work, as well. This is a link to a piece done on NPR 3 years ago, callled "The Giant Pool of Money". I think you have to do a little clicking to actually get the streaming audio. There is also a transcript available that I couldn't find the link for. It's worth getting.
http://www.thisamericanlife.org/radio-archives/episode/355/the-giant-pool-of-money
I can't agree that "The Powers That Be" created the Great Depression. The wealthy were wiped out along with the poor in 1929, as they were during the other great depressions of the 1890's (the whole decade was a long bad depressed period), 1873 (a really terrible crash), and 1837. Some smart rich people made out, others were wiped out. Some poor people found ways to make fortunes in the midst of economic chaos. That's always the way it is.
The argument is often made that politics exacerbated the Great Depression. The United States, thinking the worst was over in 1936, decided to balance the Federal budget in 1937, which tipped the economy back into another severe downturn. The lesson that balancing the budget during an economic slowdown is not a good idea still doesn't seem to have sunk in.

 

[kyboots]

I could not agree more. The wealthy were wiped out too during the great depression. Sure there were some who had money and some who made money but that is always the case. The depression was prolonged in the US by the events of 1936 and 1937, but that does not mean we should not get the spending under control, since having the deficit now may hurt us even more. Balanced budget in the future but not yet. To me this credit rating drop by S&P will turn out to be a big nothing after this weeks panic. There is no reason for this drop in the market other than a correction. Unfortunately it plunged through support levels too easily. I am a believer it is a time to buy equities with good dividends.---John

 

[V.C. Brunswick]

I'm going to voice my opinion on this after trying to leave it alone as long as possible.
It was made clear that the main-investors and banking families had a lot to do with the first great-depression. Now i'm not going to bore everyone with all the details, but it was them who started the entire panic purposely and ended up profiting massively on it.

I think you might be on to something. Here's a name and face that comes to mind when I think about it. I can't think of anyone else who has the means and wherewithal to engineer a massive financial meltdown like this than...

George Soros (aka Scary Dude)

This is a man who by his own admission has a massive messianic complex and seeks to reshape the world based on his own vision.

A large part of Soros' multibillion-dollar fortune has come from manipulating currencies. During the 1997 Asian financial crisis, Malaysian Prime Minister Mahathir bin Mohamad accused him of bringing down the nation’s currency through his trading activities, and in Thailand he was called an “economic war criminal.” Known as “The Man who Broke the Bank of England,” Soros initiated a British financial crisis by dumping 10 billion sterling, forcing the devaluation of the currency and gaining a billion-dollar profit.

 

[jamespowers]

The argument is often made that politics exacerbated the Great Depression. The United States, thinking the worst was over in 1936, decided to balance the Federal budget in 1937, which tipped the economy back into another severe downturn. The lesson that balancing the budget during an economic slowdown is not a good idea still doesn't seem to have sunk in.

That is a Keynesian argument. The fiscal stimulus back then was an absolute failure that did nothing to change the facts that we still had a 15% unemployment rate and $100,000,000 deficit in 1937.
In fact, in 1939, ten years after the crash on Wall Street, the Secretary of the Treasury, Henry Morgenthau, Jr., told the House Ways and Means Committee:

“We have tried spending money. We are spending more than we have ever spent before and it does not work. And I have just one interest, and if I am wrong…somebody else can have my job. I want to see this country prosperous. I want to see people get a job. I want to see people get enough to eat. We have never made good on our promises…I say after eight years of this administration we have just as much unemployment as when we started…And an enormous debt to boot!”

More than likely it was caused by three factors then. The federal reserve tightened the money supply (by increasing the federal reserve requirement three times!) far too soon thinking that the crisis was over because a small hiccup in the figures indicated a recovery (just as we had a few months ago). That created a credit crisis at the time in a very short time.
Another thing that caused a decrease in spending and money in circulation was several taxes or tax increases were implemented in 1937 (sound familiar?). The top marginal rate was increased from 59% to 75%! Second, President Roosevelt implemented a tax on the undistributed earnings of companies which he argued were shielding income from taxation by refusing to increase dividends. Finally, the new Social Security program with 2% payroll deductions (half was paid by employees and employers) was instituted in January 1937. (this is surprising in the sense that we are seeing the same failed tactics being used today).
Lastly, the 1935 Wagner Act passed. Real wages did indeed increase but so did work stoppages and strikes that reduced GDP output.

 

[SGT Rocket]

I think we are in a replay of 1936 and 1937. It really sucks.

 

[Stray Cat]

Only good thing about living HERE (far from other lovely loungers) is that I have NO IDEA about great depression. I know what it is (was.. or will be), I've had my history classes. However, here.. I grew up in a constant great DEPRESSION. So: inflation, salary cuts, jobless years, GDP dropping below surface.. it is NORMAL everyday happening for me. If I see stability, I'd be surprised, and I'd be lost.
We don't do "stable time" here.. no, sir.

..it MUCH more FUN.
(sense the irony?)

 

[appa69]

Who would have thought we would actually need all those jobs that got shipped overseas? Oh well live and learn. Except we never do.

 

[V.C. Brunswick]

More than likely it was caused by three factors then. The federal reserve tightened the money supply (by increasing the federal reserve requirement three times!) far too soon thinking that the crisis was over because a small hiccup in the figures indicated a recovery (just as we had a few months ago). That created a credit crisis at the time in a very short time.
Another thing that caused a decrease in spending and money in circulation was several taxes or tax increases were implemented in 1937 (sound familiar?). The top marginal rate was increased from 59% to 75%! Second, President Roosevelt implemented a tax on the undistributed earnings of companies which he argued were shielding income from taxation by refusing to increase dividends. Finally, the new Social Security program with 2% payroll deductions (half was paid by employees and employers) was instituted in January 1937. (this is surprising in the sense that we are seeing the same failed tactics being used today).
Lastly, the 1935 Wagner Act passed. Real wages did indeed increase but so did work stoppages and strikes that reduced GDP output.

Not many people today realize this but ironically in 1932 FDR ran on a platform of lower taxes and smaller government.

 

[jamespowers]

Not many people today realize this but ironically in 1932 FDR ran on a platform of lower taxes and smaller government.

:rofl: :rofl: :rofl: Yes ironic for sure.

 

[jamespowers]

I think we are in a replay of 1936 and 1937. It really sucks.

I thought about this a bit last night and about a few danger signs that we can watch for. Just as history repeats itself, bad economic decisions usually do as well----with the same results. Keeping that in mind, if you see banks taking holidays and closing for weeks at a time to "let things settle down" then beware. This might be the case with Bank of America as their stock is in a freefall and their liquidity is in question. Maybe it is time to Straighten out all the banks and make them Conform to Generally Accepted Accounting Practices. Maybe press the button and cold boot the whole system if necessary. [huh]
If the government feels threatened by a mass exodus to gold and decides to pull a 1933 and make it illegal for individuals to own gold then you need to really worry, as years ago that resulted in a 40% loss in value.
If the Fed uses Quantitative Easing to print money and bolster the markets then worry about getting out of the market as itis too shaky to leave your investments in for that period of time. Throwing money at a problem never works when there are structural problems that could better be addressed without devaluing the dollar further.
Lastly, if the International Community abandons the dollar as the accepted denomination for valuing oil and other transactions then certainly be worried. In this, oil, as one example, would need to be purchased in the new preferred currency and we would lose value in the conversion---in all trade for that matter. :eusa_doh:
Have a nice day now.

 

[MikePotts]

The gist of The Gods of the Copybook Headings, by Rudyard Kipling

"all men are paid for existing and no man shall pay for his sins"

another prophet, read Enoch Powell's 'Rivers of Blood' speech sometime.

I was, as a callow youth, taught to despise the man, but.

 

[Marc Chevalier]

"... no man shall pay for his sins."

Oh I'm paying all right, but on an installment plan.

 

[AtomicEraTom]

Well said, buddy.

Who would have thought we would actually need all those jobs that got shipped overseas? Oh well live and learn. Except we never do.

 

[LizzieMaine]

Who would have thought we would actually need all those jobs that got shipped overseas? Oh well live and learn. Except we never do.

Open up the henhouse door, America. Your chickens are coming home to roost.

 

[Pompidou]

I think everybody knew we needed those jobs, even the people exporting them, but five year old Indonesian boys will work for a penny a day, and they don't say no if they don't want a beating. We'll see jobs returning to America when our working class allows itself to be shamelessly exploited like they once did. Why should the company shareholders pay an American 15 dollars an hour and have to guarantee safety when 3rd world people will die to make a hundred Nike shoes for a penny? It's a rough economy, and it's the duty of every American to save money responsibly where s/he can.

 

[Undertow]

...It's a rough economy, and it's the duty of every American to save money responsibly where s/he can.

And it's also the duty of every American to put their money where their mouth is. Buy American! Pay a little extra for quality, and help provide a living wage for our men and women in this country.

 

[LizzieMaine]

Look for the union label. If you can find it.