World Economy Worst Since The Depression

[dave lackey]

Remember the 1950's when school children were trained to crawl under their desk, duck and cover and kiss their behinds goodbye?

What is our esteemed economists' advice now?

http://money.cnn.com/2009/03/09/news...ion=2009030907

[jonmanjiro]

It was the advice from economists that got us into this mess in the first place. I say we turf them all out

"Anyone who believes exponential growth can go on forever in a finite world is either a madman or an economist." - Kenneth Boulding

[sevo]

Heck, where are the proportions? People do seem to forget what level we are shrinking at - in the twenties, the depression hit a population already mass-unemployed and on starvation wages, where only a small upper crust could afford luxuries like a house, car, camera, wrist watch, and where the majority had not even a individual room and bed or three meals a day.

Even if we'd lose 90% of all our possessions and income, we'd still be considerable better off than the average European in 1925 or 1950 - even a 75% loss would merely set us back to mid seventies standards, and by realistic measures, we're only talking about a slump in the 5-10% range, i.e. back to the nineties.

Sevo

[dave lackey]

Originally Posted by sevo

Heck, where are the proportions? People do seem to forget what level we are shrinking at - in the twenties, the depression hit a population already mass-unemployed and on starvation wages, where only a small upper crust could afford luxuries like a house, car, camera, wrist watch, and where the majority had not even a individual room and bed or three meals a day.

Even if we'd lose 90% of all our possessions and income, we'd still be considerable better off than the average European in 1925 or 1950 - even a 75% loss would merely set us back to mid seventies standards, and by realistic measures, we're only talking about a slump in the 5-10% range, i.e. back to the nineties.

Sevo

You want realistic? How about being with no income for the last 6 months and no hope in my field for the next 2 years? Nothing left to fall back on now. The so-called "burp" ie-recession is a fullblown depression here in Georgia where unemployment is over 10% and going higher.

Ask the widow of the a land-developer client of mine who shot himself when the bottom dropped out.

Try walking in my shoes that I just glued back together so I could pay rent this month and THEN we can talk about how much better off we all are...

Nope, we disagree on the extent of misery. It IS that bad.

[Nikon Bob]

Originally Posted by jonmanjiro

It was the advice from economists that got us into this mess in the first place. I say we turf them all out

"Anyone who believes exponential growth can go on forever in a finite world is either a madman or an economist." - Kenneth Boulding

You got to love that quote. I don't think any of the so called experts have any clear idea of how to get out of this mess but they sure were good enough to help engineer it.

Dave

It is hard to be optimistic in this time of global financial crisis but you have to keep putting one foot in front of the other. The alternatives are much worse in the long run. I hope you catch a break soon.

Bob

[Olsen]

Originally Posted by dave lackey

You want realistic? How about being with no income for the last 6 months and no hope in my field for the next 2 years? Nothing left to fall back on now. The so-called "burp" ie-recession is a fullblown depression here in Georgia where unemployment is over 10% and going higher.

Ask the widow of the a land-developer client of mine who shot himself when the bottom dropped out.

Try walking in my shoes that I just glued back together so I could pay rent this month and THEN we can talk about how much better off we all are...

Nope, we disagree on the extent of misery. It IS that bad.

What you are describing is pure hell. How has USA become such a harsh place?

Unemployment is a very realistic alternative here in Norway these days too. Unemployment was 2,5% and on it's way up to 4,5 - 5%, possibly even higher. The reason unemployment will not run higher is that the local communities and the state are such large employers (No, it is not bureaucracy, they do tasks done by private companies in USA). Contrary to USA the state and most local communities are rich. With funds instead of large debt. - We have saved money for such an event we see now. Unlike USA who has spent 'just everything'.

Here in Norway you will get 'unemployment salary' for two years, and 'new job training' after one year. Free. Most unemployed here are immigrants. So, they teach them Norwegian, and such. If you are close to retirement, they will just give up trying to get a job for you and you might leave with an 'early retirement'. That early retirement compensation not as handsome as 'the pension', though.

I turn 60 later this year. 'If all goes well', I will retire after 62 years. The pension I get is 66% of my current salary. Index regulated. Not bad, he?

I am not that into what my 'early retirement compensation' really is, but it is far lower. If I have to leave - get sacked, before 62, I will have to live with an 'early retirement compensation' until I am 67. A bit complicated, but this is how it works.

Of ordinary people (never mind the billionaires), it seems to me that 'European pensioners' will come out OK from this crisis: They have 'index regulated pension schemes - by law' and are backed by strong currencies. - Very much like American pensioners that travelled around Europe in the 50'.

How could that be? Well, we learnt it all from you - Americans! Roosevelt & New Deal and all that. The pension schemes we are harvesting today were founded by our ex. WWII politicians who were very fond of USA. Most of them were CIA agents, - regardless if they were socialists or conservatives, they were all 'Uncle Sam's Rabbits' (according to a Norwegian book with that title). Thanks G*d for that!

Put in a little prudent financial policy over the years. Like building up public funds, year by year, instead of debt. The same as USA did. Up until Ronald Reagan.

Socialism? Well, not Carl Marx, but Roosevelt, that was his name. A strong ideal that has molded the policies of pax WWII Europe.
'
And you...?

[bmattock]

Originally Posted by Olsen

And you...?

Let me know how many Norwegian flags you see flying on the moon.

You make Norway sound so nice - except then one remembers, oh yeah, it's Norway. Like telling people how great the economy is in Antarctica. Who cares? Norway's national motto is "Oh Well, At Least We're Not Finland." I've owned cars bigger than Norway.

[hjagis]

I live in Iceland. Hjalti

[ebolton]

Originally Posted by bmattock

Let me know how many Norwegian flags you see flying on the moon.

All that American hardware on the moon isn't doing anybody much good right now, is it? The Chinese are going there- maybe we can get them to haul some of it back for us on the return trip, so we can sell it for scrap.

[bmattock]

Originally Posted by ebolton

All that American hardware on the moon isn't doing anybody much good right now, is it? The Chinese are going there- maybe we can get them to haul some of it back for us on the return trip, so we can sell it for scrap.

All that technology we developed, you mean? Yeah, it's doing good. For everyone. And the Chinese...40 years after us? Wow.

[jonmanjiro]

Originally Posted by hjagis

I live in Iceland. Hjalti

Can't imagine what its like over there at the moment...

Quotes below from this article.

“You have to understand,” he told me, “Iceland is no longer a country. It is a hedge fund.”

Iceland instantly became the only nation on earth that Americans could point to and say, “Well, at least we didn’t do that.”

[Olsen]

Originally Posted by bmattock

Let me know how many Norwegian flags you see flying on the moon.

You make Norway sound so nice - except then one remembers, oh yeah, it's Norway. Like telling people how great the economy is in Antarctica. Who cares? Norway's national motto is "Oh Well, At Least We're Not Finland." I've owned cars bigger than Norway.

Indeed.

Not only did you go to the moon, you were running a war in Vietnam - while saving money for a rainy day too. All at the same time. No small achievement. You passed that rainy day sometimes in the 80'.

Anyhow, never mind Norway (or Iceland, for that matter). Look up the majority of Western Europe. A population of a couple of hundred million people - with 'health care for all', 'index regulated pension schemes' etc.

[Spoks]

The just ousted head of the Czech government Mirek Topolanek, openly criticised the financial policy of the US government, telling European parliamentary deputies that America was on the "road to hell".



Speaking before the European Parliament on Wednesday, Topolanek warned that the massive costs of the stimulus plans and financial bailouts implemented by the US administration led by President Barack Obama would undermine the stability of the global financial market.

[fergus]

Originally Posted by Olsen

- We have saved money for such an event we see now. Unlike USA who has spent 'just everything'.

I presume the USA is in a similar position to Australia and similar economies.

We did not just 'spend everything'... but to a large extent spent what we did not yet have and had not yet earned, through overwhelming levels of un-sustainable borrowing. This applies to our household and business sectors, and to some areas of government here. (might be different in the usa?)

Many of the 'solutions' now being offered involve getting businesses and people back to their borrowing ways; government(s) encouraging the banks to start lending again like they used to. Apparently if we could all just keep borrowing again, then all would be well?

Not many seem to have worked out that borrowing to such an extent cannot be the solution, it is the cause of the problem!


There was an excellent idea quoted some months back by Paul Orfaela: Giving money to banks, which have failed at their only job (which was to have money), might not be the best idea...

[steamer]

A little late to the party here, I don't think one can tar all economists with the same brush, it was the counsel of neo-liberals and other free-market true believers like Milton Friedman that got us into this mess. Keynesian Guys like Joseph Stiglitz, and Paul Krugman predicted this mess and they offer ideas on a way out. Too bad Obama has cut them out in favor of Summers, Geitner, et al.

[Spoks]

Originally Posted by steamer

A little late to the party here, I don't think one can tar all economists with the same brush, it was the counsel of neo-liberals and other free-market true believers like Milton Friedman that got us into this mess. Keynesian Guys like Joseph Stiglitz, and Paul Krugman predicted this mess and they offer ideas on a way out. Too bad Obama has cut them out in favor of Summers, Geitner, et al.

This I agree with.