Sunday, March 7, 2010

Facing A Crisis

When I was reading my history of the Great Depression I used to wonder if I would figure out ahead of time that the temblor was coming. I remember reading about how some people lost their shirts and other didn't. Curiously enough one name that stuck in my memory bank was Charlie Chaplin who pulled his money from the stock market (or his accountant did) putting him in a very comfortable position as his contemporaries struggled to find a way ahead in the chaos. That Chaplin was a socialist gives his prescience just a slight twist of irony. In those days investing was rather more straightforward and government intervention was not a given to save the shirts of those fallen on hard times. A bad choice had painful consequences.

Library Of Congress. Depression Soup Line 1932

So when our own Great Depression came knocking I found myself in the curious position of being very well aware but not having a clue what to do. Unlike Chaplin I had no great fortune to withdraw from the Stock Market, my wife and I came to the conclusion it was a racket and pulled out when the first dip came in 2000 when the dot com boom went bust. We sold our home in California as the housing boom peaked and bought a small home in the Keys at the same time. It seemed like a good idea, even though prices seemed likely to go down who knew how messed up the whole mortgage default swap market really was? This wasn't just a boom imploding, it was the uncovering of a giant Ponzi scheme that wrecked the economy far and wide. It should be easy enough to say, in retrospect one should have done this or that, in preparation for what was to come. A lot of people were caught in really bad shape and as a consequence have lost their homes, second mortgages and all.

It seems clear enough that the economy is going to still follow a path of gradual decline, yet what should one do? All around us everything carries on more or less as normal. We get decimated by economic misfortune and watch our neighbors slide down the slippery pole but do we protest? Not like the Greeks we don't, we just keep our heads down and hope for the best.

So in light of that sort of attitude it's hard to know what to do, especially when our leaders tell us things are getting better and our neighbors seem to believe them. I wonder if I will look back in a year or three and say to myself, I should done this or that. By then it will be too late. It always is.

1 comment:

Jack Riepe said...

Dear Sir:

Note how well dressed the folks are in the soup line. Many are wearing ties. You don't get that at the unemployment office.

I shal be following this blog with great interest.

Jack in East Goshen