Sunday, November 30, 2008

Great Depression II, But Everything Looks the Same

One of the weirdest, most perceptually jarring things about the economic crisis is that everything looks the same. We are told every day and in every news venue that we are in Great Depression II, that we are in a crisis, a cataclysm, a meltdown, the credit crunch from hell, that we will lose millions of jobs, and that the great abundance is over and may never return. Three great investment banks have fallen while a fourth totters, and the Dow Jones Industrial Average has fallen 31% in six months. And yet when you free yourself from media and go outside for a walk, everything looks . . . the same.

Everyone is dressed the same. Everyone looks as comfortable as they did three years ago, at the height of prosperity. The mall is still there, and people are still walking into the stores and daydreaming with half-full carts in aisle 3. Everyone's still overweight. Nothing looks different.

In the Depression people sold apples on the street. They sold pencils. Angels with dirty faces wore coats too thin and short and shivered in line at the government surplus warehouse. There was the Dust Bowl, and the want of the cities. Captains of industry are said to have jumped from the skyscrapers of Wall Street. People didn't have enough food.

They looked like a catastrophe was happening. We do not. It's as if the news is full of floods but we haven't seen it rain.

Anyway it is odd, surreal, to have the steady downbeat of Great Depression II all over the news, and few signs of GDII on the street, odd that the news we're hearing is at odds with what our eyes are seeing, at least at the moment.

~Peggy Noonan in the WSJ

MP: Michigan has been in a "single-state recession" for years, and yet almost every time I go out to a restaurant, it's completely crowded, often with lines waiting to get in?? Yes, everything looks the same, even in Michigan. Even in Flint, Michigan.


At 11/30/2008 10:30 AM, Blogger jcarroll1948 said...

Opinion. The political leanings of the main stream media (80%-90% pro Democrat) impacts economic reporting, this being especially true during the recent election season. Accordingly, following 20 Jan 09, the MSM will start to emphasize economic positives as the new administration assumes power.

At 11/30/2008 11:26 AM, Blogger Dave Narby said...



Peggy Noonan is hardly a pro Democrat commentator.

That said, she's also the only person I've heard be bullish on the prospects of malls. All I've been reading is how retail floor space is down a buck a foot from last year, newly opened spaces are remaining vacant, and that it's a "buyer's market".

At 11/30/2008 11:54 AM, Blogger fboness said...

Don't underestimate the nostalgia Democrats have for the depression. It was a time when their rule was unquestioned.

You didn't miss the Time cover with Obama as FDR, did you?

At 11/30/2008 12:46 PM, Anonymous Anonymous said...

There was an article I read about how a depression might look like in today's world. I can't find it now, but just to summarize, the author of the article states that the Depression would look a lot different than in the 1930s. The reason being that in the 1930s people were either living in highly urbanized centers or in the country side. Now, we have suburbs. So, you won't see people trying to sell apples to you on the side of the street. Instead people will be holed up in their homes, unable to afford to go out to eat or any expensive entertainment. The glow of TV screens in the evening might be a sign of what you see, because people won't be able to afford any other form of entertainment.

At 11/30/2008 1:31 PM, Blogger zephyr said...

The assertion that the suffering people are not visible because of suburbs is false.

More people live in urban centers today than during the great depression. And the least visible would be the people out in the farms - a much smaller share of today's population.

No, I would expect the suffering to be more visible today - if it were comparable.

Even if not visible, where is the 15-25% unemployment? Why are average people still spending money on frivilous items and luxuries? Answer: because they can. During the depression they could not.

You will know times are tough when food sales drop. When people can no longer afford to overeat their way to obesity.

No sign of that yet.

At 11/30/2008 1:43 PM, Blogger QT said...


Entertainment deprivation isn't exactly comparable to begging on a street corner, lining up at a soup kitchen or travelling as a hobo across America in search of work with not much more than the clothes on your back.

The scale of misery in the Great Depression is almost incomprehensible today. The folks in New Orleans have a better idea than most of us. If you cook from scratch rather than eating out, you are still able to afford food. It isn't like going without food.

What we are living through is a very serious, financial crisis but it is not a catastrophic personal crisis for most U.S. residents. Sure, my RRSP (Cdn equivalent to 401K) is way down but I don't need that money right now. This week I made 3k just by taking advantage of market volatility. Unless you are living off investment income (ie. retired), retirement savings represents investments that have a long term investment horizon.

At 11/30/2008 1:46 PM, Blogger oldwhiteandpoor said...

What great abundance???????????????

At 11/30/2008 1:53 PM, Blogger oldwhiteandpoor said...

zephyr said:

Even if not visible, where is the 15-25% unemployment?

It is right before your eyes, it's just that it is not property measured by flawed government methodology.

Just as government can't properly measure poverty, it also cannot properly measure unemployment.

p.s. I've been unemployed over a year, and not counted by government as unemployed.

p.p.s. government "employment" offices are a travesty and a colossal waste of time and money for anyone looking for a job. these offices are not there to serve jobseekers, they exist to serve employers.

At 11/30/2008 2:32 PM, Blogger oldwhiteandpoor said...

MP - You're in Ann Arbor, correct? Ann Arbor, like East Lansing, is largely - not completely, but largely - insulated from the larger surrounding economy.

For example, how many layoffs has the University experienced lately - or ever?

At 11/30/2008 5:17 PM, Blogger zephyr said...

"'s just that it is not property measured by flawed government methodology."

The unemployment numbers are always understated. And there was no accurate count during the depression. Nobody really knows how bad it got. But 15-25% is the accepted estimate.

We are far better at finding people today. But if you are not seeking work nor collecting unemployment, then you will not be counted as unemployed.

Counting those who do have jobs is a better measure of the labor market.

At 11/30/2008 5:22 PM, Blogger zephyr said...

You say you have been unemployed for over a year. Sorry to hear that. But it does help in understanding your point of view...
...As the old saying goes: It is a recession when your neighbor loses his job, and a depression when you lose yours.

At 11/30/2008 5:58 PM, Anonymous Anonymous said...

It’s a common misconception that only those who are collecting unemployment checks count as being unemployed. Apparently, if you do not look for work in four weeks, you are not counted as being in the labor force—sounds right to me. Here’s how the Bureau of Labor Statistics (BLS) estimates unemployment:

Definitions. The labor force and unemployment data are based on the
same concepts and definitions as those used for the official national
estimates obtained from the Current Population Survey (CPS), a sample
survey of households that is conducted for the Bureau of Labor Statis-
tics (BLS) by the U.S. Census Bureau. The LAUS program measures employ-
ment and unemployment on a place-of-residence basis. The universe for
each is the civilian noninstitutional population 16 years of age and
over. Employed persons are those who did any work at all for pay or
profit in the reference week (the week including the 12th of the month)
or worked 15 hours or more without pay in a family business or farm,
plus those not working who had a job from which they were temporarily
absent, whether or not paid, for such reasons as labor-management dis-
pute, illness, or vacation. Unemployed persons are those who were not
employed during the reference week (based on the definition above), had
actively looked for a job sometime in the 4-week period ending with the
reference week, and were currently available for work; persons on layoff
expecting recall need not be looking for work to be counted as unemployed.
The labor force is the sum of employed and unemployed persons. The unem-
ployment rate is the number of unemployed as a percent of the labor force.

At 11/30/2008 7:22 PM, Blogger oldwhiteandpoor said...

zephyr said:

We are far better at finding people today. But if you are not seeking work nor collecting unemployment, then you will not be counted as unemployed.

I am seeking work, but nopt through the official worthless government "employment department". I tried it earlier and found it to be quite useless.

Also I am not collecting unemployment, hence, I am not counted in government unemployment stats.

At 11/30/2008 7:26 PM, Blogger oldwhiteandpoor said...

zephyr said:

You say you have been unemployed for over a year. Sorry to hear that. But it does help in understanding your point of view...

As an older unskilled worker, I suspect that I may have attained unemployability.

At 12/01/2008 7:01 AM, Blogger juandos said...

"As an older unskilled worker, I suspect that I may have attained unemployability"...

Oh! Well boo! hoo!

That's complete nonsense...

I see older folks getting hired all the time at places like Wal-Mart and other retail outlets even before the Xmas rush...

Hopefully you aren't waiting on the promises of the pinko parasite for your future employment needs...

At 12/01/2008 9:51 AM, Blogger QT said...


Isn't it time you got some skills and set goals for yourself?

If the present game is a losing one, only you can change it. Every time you apply for a job or have an interview, you project who you are without even realizing it.

People sense desparation, low self esteem, lack of motivation, the poor-me attitude.

You can continue with the "kick me" sign on your back and the chip on your shoulder a mile wide, but it doesn't seem to be an approach that has worked up to now.

You deserve a good life. Figure out what you want to do, improve your job skills and go for it.

There are no white knights on chargers to rescue us or give us a good life. If we don't want more for ourselves, we end up with less.

You've tried less and it sucks. So, you know what you don't want...more of the same. That's progress. You also are not alone. There are lots of us in the same boat. It's very easy to get discouraged. Found this book very helpful.

Always change a losing game by Dr. David Posen.

At 12/01/2008 10:51 PM, Blogger oldwhiteandpoor said...

QT -

I'd LOVE to get some skills - where do I sign up? (I have no money and cannot get financial aid, so school is not an option.)

My resume, lacking any career-related experience, is worthless and has not gotten me an interview in 20 years.

At 12/01/2008 10:53 PM, Blogger oldwhiteandpoor said...

1 said:

I see older folks getting hired all the time at places like Wal-Mart and other retail outlets even before the Xmas rush...

That's very nice, but I have appearance deficits and try to avoid applying for retail jobs.

At 12/02/2008 9:21 AM, Anonymous Anonymous said...


Have you tried your local community colleges for retraining? Many people assume they don't qualify for paid training, but you seem to fit the bill for a lot of programs.

I've taught vocational education classes off-and-on over the last 25 years, and I've had students from fresh-out-of-high school to 70-years-old. Many did not have money to pay for the programs.

There is a job out there for you. Don't give up. Only you can defeat yourself!

At 12/02/2008 6:07 PM, Anonymous Anonymous said...

There are many jobs I can DO, but being able to DO a job well and being able to GET the job are two entirely different things; and my menial job history is an albatross I cannot shake.

At 4/03/2009 12:29 PM, Anonymous Anonymous said...

Based on your profile , you do not
have to be afraid to loose your job.


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