Thursday, November 27, 2008

Lets Be Thankful

Happy Thanksgiving! And be grateful for what you have! In a few years what you have today may be gone. Still have your house - be thankful! Still have decent credit - be thankful! Still have a job - be thankful! Not one of the one in ten that are on food stamps - be thankful!

Waking up to these two articles titled The last Thanksgiving before GD2 and US faces another depression really puts one in the holiday mood. First, lets take a look at the The last Thanksgiving before GD2 article -

The U.S.S. Titanic encountered this iceberg during the week of October 6, 2008. Everything that happens afterwards and in the immediate days, weeks, months, and even years following is just governments and their corrupt, criminal fiends on Wall Street and elsewhere going through the motions. Like the band that kept playing aboard the real R.M.S. Titanic, the politicians and the “captains of industry” will paint a bright and rosy picture for the third-class passengers aboard the U.S.S. Titanic, while they all don on their financial life jackets and run like hell for the very few financial lifeboats!

Buried in a report from on November 12 titled “Stocks plunge for third straight session” was the following incredible statement: “According to the Dow Jones Wilshire 5000 index [which reflects the value of almost all U.S. stocks], Wednesday’s [November 12] paper losses amounted to about $600 billion. By that measure, the [U.S.] stock market has shed $9.1 trillion since the index’s Oct. 9, 2007, peak.” The bolded emphasis in mine. The Dow Industrial Average or Dow, which is comprised of 30 “blue chip” stocks, closed out at 8,262 on November 12, and was at 8,046 at the close on November 21, so the estimate of $9.1 trillion of financial losses since October 9 is a pretty close guess, if not a conservative one.

To provide further evidence, as if the evidence given above and from what you can glean from the corporate mass media are not sufficient, as to the extreme dire straits that is facing the U.S. and the very likelihood of GD2 occurring very soon, I have taken liberty to include an extensive excerpt from my ebook, NO Foreclosures!, that was written in July 2008 (I have also taken the license to forgo most of the footnotes that are included in the ebook). As you probably will realize after reading this excerpt, that even in the short 3 or 4 months since those words were written, with the exception of the temporary rise of the USD and the temporary drop in gas and food prices, everything else have accelerated for the worse.

So America, on this Thanksgiving 2008 which may be the last one before GD2 becomes a cold reality, I have one suggestion:

Be grateful!

And now lets take a look an an excerpt from U.S. face another Depression -

The Great Depression was the result of the combination of the 1929 financial crisis and serious structural problems in the American economy that included widespread poverty. After the 1929 stock market collapse, these factors combined to deeply cut business investment and personal consumption. This caused a downward depressionary spiral that created the worst economic collapse in American history.

Today's economy is hurtling downward on a similar path to depression. The mortgage and financial crises have constricted credit and largely cut off business investment. Stagnant wages and over-borrowing have curtailed consumer spending.

Much as was the case in 1929, the twin declines of consumer and business spending are rippling through the economy. They are causing worker income to fall, lower consumption and more layoffs. As unemployment rises, more individuals will be unable to pay their debts, and additional personal and business bankruptcies will follow. This means more bank and investment company failures and bailouts.

The American economy in 2008 is following the same path it took in 1929 -- the collapse of a speculative bubble has merged with problems of the distribution of wealth and working American incomes and consumption. The consequence is that the economy is rapidly spiraling downward into the next great depression.
Well, the future does not look like things are going to be very pleasant for the next few years. And the outcome of Black Friday will probably illustrate of what to expect for the holiday season. Will the holiday season put people deeper in the hole or will we take a reprieve from going further into debt?

The heavy focus on debt-driven consumer consumption does not really have any positive outcomes. We lived in a bubble world financed through money we did not have. We will be paying a heavy toll. We are being forced to create a new paradigm in regards to spending and saving.

Maybe we should be thankful that it has been almost 80 years since the first great depression. We were able to hold on to the lessons learned for several generations. Hopefully after this mess our children, grandchildren and great grandchildren will remember the mistakes we made/allowed/ignored.

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