Re:Crisis may make 1929 look a 'walk in the park'
by noonespecial on Thursday December 27, 2007 @01:53AM
(#92914)
I think that the chance of a "world wide" depression like 1929 is remote at this stage in human progress.
During that depression, there was very little wealth in the world, just a lot of credit based on a jubilant realization that humans had learned a trick that was geometrically generating wealth. It was a bit of over-excitement that led to a temporary stall right at the base of the j-curve.
The most important issue was that nearly all of the factors of production worldwide rested in one nation, the USA. Even those factors outside the USA were still contained in "western" culture nations. America's problem became everyone's problem.
The USA is no longer the center of the world. The factors of production are now distributed all around the world and are contained in many cultures. In addition to this, much of mankind's wealth is now intellectual as well as physical.
The shenanigans of a few rich white men who shuffle paper money and don't build anything no longer have the power to bankrupt the world.
Think of it this way; Even if every major financial market crashed simultaneously worldwide, we still don't have to reinvent tetracycline, or rebuild the Hoover dam.
Depressions and recessions might just be nature's way of slapping humans upside the head and saying "quit diddling on little scraps of paper and go build something useful."
During that depression, there was very little wealth in the world, just a lot of credit based on a jubilant realization that humans had learned a trick that was geometrically generating wealth. It was a bit of over-excitement that led to a temporary stall right at the base of the j-curve.
The most important issue was that nearly all of the factors of production worldwide rested in one nation, the USA. Even those factors outside the USA were still contained in "western" culture nations. America's problem became everyone's problem.
The USA is no longer the center of the world. The factors of production are now distributed all around the world and are contained in many cultures. In addition to this, much of mankind's wealth is now intellectual as well as physical.
The shenanigans of a few rich white men who shuffle paper money and don't build anything no longer have the power to bankrupt the world.
Think of it this way; Even if every major financial market crashed simultaneously worldwide, we still don't have to reinvent tetracycline, or rebuild the Hoover dam.
Depressions and recessions might just be nature's way of slapping humans upside the head and saying "quit diddling on little scraps of paper and go build something useful."