Tuesday, 7 October 2008

And the next bank to fail is ......

It's amazing how language can change one's perception of an event. This year we have gone from "a slowdown in the economy" to "a credit crunch" to "a global financial crisis".

It's just been bad news all the way in my life. I could have told you two years ago there was a slowdown when we had our house for sale. In six months we had only four viewers and two of them don't really count because they were just being nosy.

Remember a few months back when the really bad news was how expensive petrol/gas was? Don't you long for those good ole days? To gain an understanding of the events happening over the last couple of weeks, I've been reading about the Great Depression and its causes. I am no student of Economics and apart from listening to my parents' stories of how hard times were then and reading The Grapes of Wrath by John Steinbeck and Hard Times by Studs Terkel, I didn't know much about the causes of the Depression. I knew the stock market crashed in 1929 and before that it seemed to be party, party, party (ala The Great Gatsby). I knew there were bread lines and people out of work and starving children. I knew Franklin D. Roosevelt created the New Deal to get people back into work (my grandparents among them) and built numerous Public Works projects as a result. I knew WWII had something to do with pulling the US out of the Depression.

I didn't understand that trade restrictions, deflation, and sharply increased taxes worked together to create the perfect economic storm resulting in Depression. There are several websites out there that clearly explain what happened.

I also thought I should be more informed about Roosevelt's presidency. He is generally accepted as the greatest US President in the 20th century. But he had to be, considering what a mess Hoover had left the country in. As I look forward to the 2008 Presidential election, I wonder which man will be able to fill Roosevelt's shoes because that is what the next president must do. Will it be the impetuous, flighty, maverick McCain with the beehived Palin ("you betcha!") standing behind him? Will it be the overly intellectual Obama whose so-called terrorist links seem to frighten ignorant Americans and whose running mate has his own issues?

I think as important as who is President is who he surrounds himself with. Roosevelt had some of the greatest people of his day behind him. Harold Ickes, Frances Perkins, Henry Morgenthau. Read about these people. They were truly innovators. I think Roosevelt's best quality must have been his ability to listen and to act on what he heard. I wish he hadn't created the Japanese internment camps during WWII though.

I made my mind up to support Obama over a year ago. Nothing has changed my mind since then. Should he win (and I think this will be a very close race to the bitter end), he will have to be very careful about who he surrounds himself with. Hard times call for the best and the brightest, but also the calmest. Roosevelt's fireside chats did as much to stimulate the economy by reassuring Americans as any of his economic policies. Never underestimate the power of confidence.

But if McCain should win, well, Tina Fey will have a job for a long time. Visit www.nbc.com and view her take on Palin. Funny but scary in its accuracy.


Anonymous said...

Yes, this credit crunch has become a crisis. I look forward to when they tell us we have all won the lottery, then want to take it all away from us to pay keep the banks afloat.

CJ xx

Kaycie said...

I swear, if McCain wins, I may have to hibernate. Or emigrate. Or something.

Annie said...

I am genuinely afraid of what life will be like if McCain wins. And I am incredibly frustrated that I can't vote :(

Very happy to know that one of my favourite bloggers supports a Dem this time around, too ;)

Some people think it's in the bag for Obama - I wish I could share their confidence.

I studied US Economic and Social History as my degree Major - one thing that strikes me about both World Wars - the US enjoyed economic boom during, and immediately after those wars - thanks to munitions manufacturing, women working (additional disposable income) and involvement in reconstruction.

Kinda makes you wonder, huh?...

Exmoorjane said...

Very interesting post....I am feeling my economic ignorance very much these days...
Yes, I too am keeping all crossed for an Obama win.

DogLover said...

"Cometh the hour, cometh the man" - let's hope so.

Or do we just start WW3 to get things going again! Perhaps Osama Bin Laden can oblige - if he can stop laughing ...

wakeupandsmellthecoffee said...

CJ: Unfortunately, we have to pay to keep the banks afloat. Widespread bank failures will be a global catastrophe. Meanwhile, keep buying your lottery tickets.

kaycie: But think of how much fun it will be to watch that idiot Palin woman all the time. McCain will get frustrated with her very shortly, I predict.

annie: Anything could happen in this election so no one should assume it's in the bag for anyone.

The U.S. also solved its unemployment problem with both wars too.

exmoorjane: I think we all are, and who wouldn't be? I just found out what BRIC stands for yesterday. The financial pages, which I used to skim, are now pored over in our house and discussed at length (despite my daughter's efforts to remain blissfully ignorant).

doglover: I still think Bin Laden is holed up in a Hilton in Washington, D.C.

Expat mum said...

I can vote! I can vote! And it won't be for that crotchety old git who called Obama "That one" last night! He's finished.

Kaycie said...

Oh, Coffee, I can't stand to watch her. She makes me feel ill. I can't even laugh at Tina Fey for long -- I remember that her caricature isn't that much of a caricature and start wondering if the whole country is going to hell in a handbasket.

Fire Byrd said...

The financial situation is it been made worse by the media as some suggest or is it that bad... and how do we find out the truth?

Hopefully when Obama wins the world will turn on it's axis and life will stop feeling quite so frightening.

wakeupandsmellthecoffee said...

expatmum: I can vote too but haven't received my overseas voting form yet. Hmmm!

kaycie: I don't understand these women who were Hillary supporters going to the other side just because Palin is a woman. Is that sexist or what?

fire byrd: It's that bad. It's not being exaggerated by the media. When entire countries are on the verge of bankruptcy, it's very, very bad. The sooner we have some competent leaders on board, the better.

Bill Stankus said...

Hi, thanks for the Black Box stop-by. You asked, if I have faith in myself... that's an interesting question. As an individual, I have tons of faith in myself... I can do many things and I have a wide range of skills.

But as a member of a society, that matter of faith (the non-religious kind) is totally different.

I think the reference to Blue and Red states has, in some ways, pointed out the great divides in the US.

This divide has always been with us - but today there are other forces augmenting the differences. Forces of historical proportions. Forces often manipulated for ulterior purposes - greed, power, control, dominance, etc.

We now are experiencing significant shifts in American values - The blending of church and state, the use of the military for Americanizing foreign countries, the media being owned by a few giant corporations, the reduction of personal civil liberties ... just to name a few.

The not so hypothetical question is: Who are we and where are we going?

My single vote is but spit in the gale winds of radical change.

Tiggerlane said...

I would rather have Tina Fey than Palin, that's for sure!

I can tell you what will hurt Obama - the prejudice of the Deep South. It still is a racist area of our nation (where, sadly, I reside).

But I think Obama is the one who is smart enough to surround himself with people who can best advise him. I've been reading his book - and he is incredibly intelligent.

We've already had a "maverick," and we sure as heck don't need another one. Just wish the race wasn't going to be so close...I would LOVE for Obama to pull a huge win. One that won't be contested by chads and courts.

the rotten correspondent said...

If McCain wins, I'm taking my whole family and moving someplace safe.

Like Pakistan.

wakeupandsmellthecoffee said...

Bill Stankus: Welcome to my blog. You mention the following: "We now are experiencing significant shifts in American values - The blending of church and state, the use of the military for Americanizing foreign countries, the media being owned by a few giant corporations, the reduction of personal civil liberties ... just to name a few."

Our country has faced these in the past. Under the very earliest presidents, there was a very close relationship between church and state, the media were controlled by just a few, there was the Sedition Act under John Adams, etc. Our country has always had a rather schizophrenic relationship with the rest of the world -- paranoid to the point of closing all trade and borders yet meddlesome in the extreme as well.

I got my absentee voter form today. Get ready to feel some spit in the wind.

wakeupandsmellthecoffee said...

tiggerlane: When JFK was elected, there had never been a Catholic president. Many were resistant to the idea, yet he still won. I believe America can show the world that a black man can be president, that the prejudices of a few don't reflect the viewpoints of many.

RC: We just need Palin and McCain to open their stupid mouths a few more times, and they will shoot themselves in the foot. Believe!

Mean Mom said...

I confess that I am fairly ignorant about politics in the US, but my recent personal observations have been as follows: Obama is very impressive, McCain has passed his sell-by date, Palin is a lightweight.

Miss Snuffleupagus said...

What's the black box?

Fred said...

It really is a scary time in our lives. To see a country (Iceland) go bankrupt is almost unheard of in the modern era. What scares me most is that it could take 10-15 years to climb out of this mess.

If the person who I vote against wins, I'm not moving anyplace. I'm going to stick around and work towards what I believe in. Running for the hills accomplishes nothing and seems to me like a "sore-loser" mentality.

I love teaching about government during presidential elections. What's even more challenging is trying to explain the economic issues that have caused this mess.

I also suspect we may have one of the highest percentages of registered voters showing up at the voting booth in November.

Fasten your seat belts.

wakeupandsmellthecoffee said...

mean mom: You are a very astute observer of US politics!

snuffy: I wrote a post about it a few posts back. Try it and see.

fred: If you're able to explain this economic mess to your class, you're doing better than most of us. I have learned about BRIC, derivatives, toxic debts, tier one, and more over the past week or so. I still don't understand derivatives too well, but neither did a lot of the people trading them, I suspect. Everyone wants a simple explanation and some bad guys they can blame.

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