Originally published at Notes from the bunker…. You can comment here or there.
Interesting day watching the week market spasm up and down. I’ve almost nothing in the market so theres no direct effect on me. I’m sure that like every episode, once things tumble far enough people looking to pick up bargains and ‘get in on the ground floor’ will start snapping up shares and things will start upwards again. Or, I suppose, the Plunge Protection Team could mobilize from their secret hollowed-out volcano base and do some behind-the-scense work to make the numbers magically change. And, of course, White House spokesdroids will remind us that the administration ‘inherited’ this problem.
When I was a kid I remember taking some economics courses at college. I remember nothing of them. I have a feeling, though, that at the moment theres renewed interest in economics and the curriculums now feature language like “This is a once in a lifetime opportunity to see real-world examples of…” I should head over to the campus and check the bookstore there for some used economics textbooks. A little more learning is never a bad idea.
I know people whose exposure in this economic climate is downright scary. They have, to me, huge amounts of money tied up in funds that have suffered nasty losses. For them, a good year has been one where they lost no money or only a small percentage of their value. And that’s a good year.
I must say, the current economic situation has been fascinating from a preparedness standpoint. Think about what we’ve been seeing – tremendous increases in unemployment, foreclosures, a jobless ‘recovery’, market rollercoasters, abandoned homes, municipal budgets collapsing, bank failures, etc, etc. We used to look to the Great Depression and ask grandpa ‘how did you get through the Depression?’ and in ten or twenty years it’ll be a new generation asking us what it was like to go through and survive this episode. Even more interesting is trying to predict what sort of stamp this will make on the national psyche. The Great Depression influenced the behavior of the folks who were there for the rest of their lives. We’ve all heard about old folks who went through the Depression and for the rest of their lives they never threw away anything, never wasted food, etc. Im sure we all have heard about the old folks who ‘don’t trust banks’ after that experience. The behavior of people after this current situation will be interesting to observe.
Preparing for an economic disaster will be more than theory after this. This is probably a good thing because if the pundits and talking heads are correct, the consequences, effects and legacy of the last few years will be coming home to roost further down the line when all these bailouts catch up to us.
