Never say never, but an event like the Great Depression is highly unlikely. Even at the time it was a singular event, born of a particular set of circumstances and errors by policymakers that would be difficult, though again not impossible but highly unlikely, to repeat. Consequently, and given the frivolous nature of Option G, I was unable to vote.
To start, the highest unemployment rate during the Great Depression was 24.9%. This at a time when what is today called the welfare state was, in the United States, extremely rudimentary and therefore provided no counter-cyclical stimulus. Throw in that the response of the Federal Reserve at the time was to raise, not lower, interest rates in order to protect the value of the dollar.
This last was the conventional economic wisdom of the era to that time. It worked, the dollar stayed relatively stable - but at the cost of economic collapse and record high unemployment. This setting the stage for Keynesian economics in the form of the New Deal, which to be sure mitigated, but did not cure, the Great Depression. (It would take World War II to do that.)
Since the Great Depression, the highest unemployment rates the nation has experienced were 10.8% in 1982 in response to the galloping inflation of the 1978-1981 period. 10.1% as a result of the so-called "Great Recession" of 2007-2009. Then finally, 14.8% in the wake of the pandemic. (This last being a deliberate policy choice, unlike the first two which were the result of the business cycle and various mistakes by policymakers.)
Please note, the latter three were not good, but they were nothing like the wholesale collapse and epidemic poverty. This because, whatever its faults, the welfare state mitigated the effects of economic contraction and sustained a certain level of economic demand that kept the economy from total collapse.
Further, as noted above, the response of the Federal Reserve in 1929-1930 to the stock market crash was to raise interest rates. This was the conventional economic wisdom of the era and it made matters far worse than they need have been. Since then, the response to recessions has been a lowering of interest rates and thus what might have been economic collapse has resulted in, at worst, sharp but not catastrophic, contractions.
To be sure, Keynesian economics had its own flaws. Thus the aforementioned "Great Inflation" of 1978 to 1981. If the inflation now is considered painful, it might be well to recall that in 1979 inflation hit 14.5% - the highest ever recorded in peacetime - and 13.1% - the first time the nation experienced back to back years of double digit inflation in peacetime. By contrast, the current inflation - again not good - is relatively tame.
Put it all together and a "Great Depression" seems unlikely. Again, that does not rule out deep recessions - see 1982 when to combat inflation the Fed punched up interest rates to 21.5% - but the infrastructure is there to cushion economic contractions. Thus making a Great Depression (or its comparable "Forgotten Depression" of 1919) highly unlikely.
To be sure, policymakers can make errors. However, the interesting thing this time is that the errors are more likely to be caused by too lax a hand, not to tight a grip. Thus the current inflation was caused by overstimulus spending by Washington and a Federal Reserve that waited too long to raise interest rates. Thus the bias is toward higher inflation and not deeper economic contractions.
Again, never say never. Human beings are imperfect and imperfectible and the unforeseen can change the calculus. That said, in many respects the chest pounding over the "next Great Depression" is a case of fighting the last war. If anything, the problems of the moment are NOT a depression, but a return to the galloping inflation of the late 1970s.
Best then to recall the words of Kipling. "If you can keep your head about you, when all around you are losing theirs', then you will be a man my son."
the real unemployment rate is 24% right now
Well, first, please show me some authoritative calculation of that number. Second, what IS down in the workforce participation rate - which makes the low unemployment rate somewhat misleading.
However, the workforce participation rate counts the labor force that COULD be looking for a job, but is not. If you are not actively looking for a job, you are not going to get a job. Quite simply, you cannot be counted as unemployed if you are not attempting to be employed.
Suffice to say, the problem in the Great Depression was NOT that people were not looking for work. It was that they could not find it. In that connection, please note that just in the last month, the number of job openings in the economy jumped by a whopping 431,000. That is jobs that are available and cannot be filled by employers.
Again, NOT the problem we were having in the 1930s. Right now, due largely to the pandemic and an unusually high - by American standards - savings rate, we have a worker shortage, NOT a job shortage.
The irony is that you are making the same mistake the Biden administration is making. By your logic we should give away more free money to help the alleged unemployed. Suffice to say, to do so would make the current situation MUCH worse.
Depressions historically last less than 10 years... I don't know where you got the 50 year figure from. With all the checks and balances now in place on global markets, it's unlikely that a depression will happen... a recession is likely before 2023 that may last a year or two.
They said 2008 would never happen. They said 1930's could never happen and that Covid would kill billions. The greatest depression in history will take more than 10 years.
The checks and balances have been rigged so extensively it makes the 1929 crash look like a joke. The entire stock market is a house of cards and the economy is on a sinking foundation held up by a small handful of mega corporations. If the general public looked into what was going on behind the scenes, they would lose all faith in the market and the dollar leading to an immediate collapse. Nearly every red flag has been thrown and the only thing keeping us afloat is the media lying and the mass printing of money, resulting in inflation. One way or another we’re going to hit bottom.
@DarkWinterNights and @888theGreat: Sorry you are so negative. I'm a positive person, and don't expect nor plan for the worst. A downturn is expected, and happens cyclically... in fact, we're overdue for a downturn... but not a crash.
truth is not negative. Living in denial is negative.
keep that way , when you are homeless and begging for food , it is better to do that positive
Thanks for the mho
I don't know since I don't live in the US. I'm sure things are not as bad as they're in the shihole where I live.
So it might not happen soon.
@888theGreat Why is this funny? I do live in a shithole.
How do you see the USA as a nice country? I don’t know what’s Portugal like? I’ve been to Spain, Madrid, Barcelona, Seville, and Marbella. Spain has much less problems than the USA. Canada, and all the European countries I’ve been to can’t match up with the USA. Ireland has some crime issues but not like here. What’s so bad about Portugal can you name problems and things you’ve seen that make it a bad country?
@Year3000 Regardless of the problems that USA has is still a country of opportunity and it's so diverse. It's not like the shithole where I'm stuck for now.
I've never been to any of these places that you mentioned, so I can't speak about them. The list of Portugal's problems is long but I'm going to sum up:
- it's a poor country
- it has no opportunities, not even for Portuguese people
- the public healthcare system is a joke
- public schools and universities are a joke too
- the unemployment rate is high
- you can't have a decent life with minimum wage
- if you need paperwork you either have to pay a lot of cash or you have to beg for the government to give you
- it's a racist and xenophobic nation
- men are violent and kill their wives and girlfriends
- people are rude and dumb
- the police doesn't work
- the Portuguese people do anything and everything for money, it doesn't matter if they're going to kill someone, if there's money they will do the "job".
I could go on and on with this but you would get bothered. So this is just to give you an idea.
Outside of NYC you won’t find many opportunities to make money. It’s like one city runs the country in a financial way. You could move to London, Zurich, Paris, Frankfurt, have the same amount of opportunity and live a safer life. I would say there is an exception if you are religious and into missionary work or becoming like a nun or something you would do better in the USA.
@Year3000 Ok, now I see what you mean. Well London never caught my attention and moving to the UK at this moment is a terrible idea because of Brexit. Paris has too many smokers and everything is super expensive there. I don't know about Zurique nor Frankfurt.
I'm not religious at all.
America is going that direction. Liberals believe if other countries are shit holes , then so should US.
I would do anything to work in any country I list what we have to stand here is beyond anything you’ve seen in Europe. I don’t even think Russia is as fucked. I do anything to live in another industrial country it’s that 3rd world here. You have that opportunity I don’t so don’t complain it’s till you visit, Mexico, India, the USA, Countries in Africa.
@Year3000 Have you heard about the unemployment rate in Spain? Especially among young people? If not, I think you should take a look in it. Also, have you ever heard about the minimum wage in Spain? Again take a look in it and tell me if I need to lower my standards.
It seems like you didn't understand that I'm not Portuguese, I'm not white and I'm from what you would call "a third world country".
Because they have benefits they don’t have in the USA. You work or you are homeless and die here nobody helps you if you aren’t from a family that has money. The majority is still employed in Spain. I’ll take some of my peers being bums over the crime, civil discourse, and violence in the USA. You watch too many movies it’s not like that. Harmony Korine makes more realistic movies like Gummo, Kids, that will give you a better understanding of my country.
I would but I would just try to go to another EU country after that if I was given citizenship. If I had the chance I would take it, maybe the weather isn’t perfect and you don’t like the politics and people but I am sure you can look up the crime stats and it will show you Portugal is safer than my country but I would love that because I can transfer to many countries that are more safe and stable than Portugal if it’s that bad. Come to the USA for 24 hours and you will see what I’m talking about.
If you can’t find a job in the EU you won’t find one in a nice place I’m sure it’s just as competitive to find a job in NYC or California but it’s probably easier to find one in like Louisiana or something because nobody wants to live there. You have Paris, Hamburg, Berlin, Dublin, in the EU name an American city better than those cities?
@Year3000 Europe is not the paradise that some people think. Besides many countries have far right politicians in their governments. Today I've heard on the news that there might a war in Europe because of what's happening between Russia and Ukraine.
Plus I can always go back to my country and I'll have more opportunities there than in any EU country.
@Year3000 I'm not in Paris and Paris and like I've said Paris is super expensive. Besides my French is far from being good. French people hate immigrants who don't speak their language.
Oh no! What am I going to do in Ukraine? I'm black and they might get into a war against Russia. Plus, there are many Ukrainians living in Portugal so that isn't a good sign.
The Florida is very welcoming to migrants and tourists, I don’t speak French and I felt at home in Paris, they are much nicer than Americans in real life. The trash in the street, the graffiti, the smell, the grittiness, I didn’t feel like I was in a foreign country if I didn’t see writing or hear someone talk. In the poorer parts of Paris I felt like I was home.
They are things that can make Americans nicer to you. Being religious, owning a gun, don’t judge fat people or drug addicts as they are the majority (I don’t have any problems with fat people or drug addicts). Outside of NYC and Florida they typically don’t like Europeans for political reasons they see European people as often secular, underweight, snobby, promiscuous, anti gun, against materialism, even if you aren’t they will stereotype you as that way.
@Year3000 How am I going to fit in if I'm not from Europe?
Any country that has smart, open-minded and tolerant people is not a shithole to me. Also if it has a good healthcare system, a good education system, if it's safe and if the unemployment rates are low.
Yeah I've heard that Canada is less racist. I thought about moving there but it seems impossible.
The USA was once one of the best countries in the world I heard like in the 80s now it’s like the rest of the rest of Latin America. Reminds more of Mexico than Canada. If you are Hispanic you might like the USA. It really sucks and it’s not safe at all but it all depends but I would stay in Portugal.
400+ million people live in North America you have to compete and be the best even if you are wealthy it’s a low quality of life besides some parts of Canada it’s like a third world continent. Even if you have money people will target you, try to rob, kill, rape you. No reproductive rights, no healthcare, shit education, you will be judged for not having kids and not being a housewife because it’s very religious still.
Do you know how many people live in Europe or at least in countries that are part of the EU?
"Even if you have money people will target you, try to rob, kill, rape you. No reproductive rights, no healthcare, shit education, you will be judged for not having kids and not being a housewife because it’s very religious still." - Are you talking about the US or Canada?
Will not move to London and work in finance? You won’t find shit here it’s not most of North America it’s really only in NYC you will find a job that you can support yourself on maybe Toronto and Montreal but I would stay far away from the US or Mexico post COVID, Trump tax cuts, border problems, cartel violence, and the riots.
Soon very soon. We are heading down hill with you too.
Opinion
19Opinion
don't know. been hearing about problems forever, doubt anyone can predict this.
for GDP to fall when the govt controls the numbers, would require the govt to want it to fall or quite an event to occur. We could stop producing everything for 2 years, leave it parked out off the piers... and still have rising gdp... as the govt just fills in the numbers with printed money and prices go up.
A major disruption like terrorist attack or conflict over taiwan might do it.
We are in hard times now with inflation out of control and rising rates, that could expose a lot of "junk" businesses, mess up real estate market, job losses. It's possible we are close... it's all govt policy and good fortune at this point.
We may have the collapse of everything. So enjoy your day and hope as good... tomorrow. If that's true, plan on social chaos and real stuff to have value.
What will I do... I'm going to be planting a garden no matter what and some fruit trees. We still live our lives... not going to live in fear.
Should have happened decades ago.
The US has been living beyond it's purpose since the Soviet Union was dissolved. Every day since has been a gift. But in True American fashion. you've just been acting entitled, getting into fights with your betters, and pissing it all against a wall.
Probably 2023 with the way things have been going thanks to the dumbass in chief and his feminazi sidekick. Then either Trump or Desantis or someone will come in in 2024 and things will begin to heal.
I don’t see either side accepting the results of the next election.
Me neither
We’re in it but it’s going to a be a small one Republican are more friendly to business and the dems approval numbers are in the toilet, Joe has a 33% approval rating making him officially the worst president in America history since polls began
Biden is only positive in 3 American states , and you could guess those 3
3 of those 4 yes
thank god i bought those guns. shits gonna get primal
Depends upon what you mean? A stagflationary decline, like the 1970s? We are there now!
A deflationary depression like the 1930s? No. See what nightdrot said.
It is here and now and only going to get worse thanks to THE DEMOCRATIC COMMUNIST PARTY OF AMERICA. Dictator BIDEN and Giggles HARRIS in charge
We're already far worse off than we were in the great depression and it's only getting worse
I'd be fucked because I'm disabled to the point where I'm in need of assistance.
I do not think we will have a depression but it is not going to be nice 3 years. And yes it will take some time after that to recover.
The next great depression will happen when the federal government cannot afford to pay the annual debt service.
We are getting there. All this new Biden spending and no one working and getting income tax. . Rich can't be taxed enough to pay it. Besides they can always move to another country. They can also move money off shore.
How many fortune tellers have been right? Let’s see…. 0%.
Oh I have been many times. I predicted housing crisis in 2008 . I said there would be a collapse in 2007 , houses were way over priced. i am saying same now , houses are way over priced. Same exact pattern as 2008 .
off topic... how cute the uncles look.
your uncles
what you mean dude
Not sure it will happen again. Aside from that point, it would be next to impossible to predict.
Probably after the virus. I mean Spanish flu then followed by the depression.
Depression happend 9 years later from the end of Spanish flu. The lack of growth in purchasing power despite the increase in productivity and investments. From 1920 to 1929 equity investments tripled their volume and stock market indices rose, from 1926 to 1929, from 100 to 216, but the increase in the value of industrial shares, however, did not correspond to an actual increase in the production and sale of goods. . When they realized that the whole market was crap, it collapsed.
Soon most likely with Democrats
maybe 2023
Lmao
here we go, the Jew boy that says there was never a depression , or 2008 , everything is fine. lets run the National Debt to 200 trillion it will be fun. Denies Jesus and his miracles. The same boy that said inflation would be gone in 2 weeks. The one that has gotten nothing he says right. LMAO LMAO
Lmao this is dumb.
yes you are , I agree. Your parents wasted all that money sending you to college.
Sooner than we think
Any day, now!
Late 2020. Most of us have beeen depressed since the theft of the last election!!
lunatic
fatso
You’re insane
You are butt ugly , I would rather be insane
2023 seems likely.
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