Another "Great Depression"

[Guest MonkeySee]

I read an article in the paper about the Great Depression in the 1930's. Many older people were interviewed and remembered those desperate times. Some remembered:

--Breadlines

--Shanty towns

--25% unrmploymrny rate

--seeing life savings held in a bank worth a penny on the dollar

--one toy at Christmas

--going to the movies, maybe once a year

--holes in shoes patched with cardboard

--eating dandelion soup, rhubarb-like weeds floured and fried, meatballs made of bread crumbs

 

Could this recent downturn turn into another "Great Depression?"

Can the younger generation do without some of the abundances we all have gotten use to and take for granted?

[Bob]

While things sure look ugly and might get uglier, one of the hallmarks of the depression (at least here in the states) was that a lot of ordinary people lost their life savings when the banks failed. Nowadays, that really can't happen given the government guarantees accounts through the FDIC (even if the bank goes in the toilet, you're protected now for up to $250,000.00 in any one bank - and, given 95%+ of the people hardly have that kind of money, probably almost nobody will lose any savings even if their bank goes down).

 

Other social programs for the poor, at least here in the states, would probably also prevent what we think of as the breadlines.

 

Many experts expect that unemployment here might rise to as high as 8% to 10% so that also would be a substantial difference.

[Guest laurence]

Nowadays, that really can't happen given the government guarantees accounts through the FDIC (even if the bank goes in the toilet, you're protected now for up to $250,000.00 in any one bank - and, given 95%+ of the people hardly have that kind of money, probably almost nobody will lose any savings even if their bank goes down).

 

Yes, but, many people have investments in other than FDIC insured securities. Many IRAs, I believe, are invested in stocks and bonds which may not be protected also pension funds are heavily invested in various uninsured financial instruments.

[Guest MonkeySee]

Yes, but, many people have investments in other than FDIC insured securities. Many IRAs, I believe, are invested in stocks and bonds which may not be protected also pension funds are heavily invested in various uninsured financial instruments.

 

My IRA is now worth less than half of what it was last year. Of course, stupid me invested in risky stocks, trying to maximize my return. Luckily, I have a few years before I will tap into it, and so let us hope the market recovers. I agree with Bob in that there are now social programs in place to help the down-trodden. I guess there is going to be a larger group of the down-trodden.

[Guest Steve1903]

I'm entering into a great depression round about now. I call it winter.

[Guest MonkeySee]

Back in 1929 through the Financial Crash it was said that some Wall Street stockbrokers and bankers JUMPED from their office windows and committed suicide when confronted with the new of their firms and cilients financial ruin. Many people were said to almost feel a little sorry for them. In 2008 the attitude has changed somewhat. I think some people feel as if they want to PUSH these bankers and executives. Times have changed.

 

[Jason1988]

My economics professor claimed that with the safety nets such as social security, unemployment compensation, etc. that we wouldn't see a depression.

 

I do think that with most American's home being worth now about half of what they were 2.5 years ago and the 401K and IRA's worth about 50-60% of what they were 3 months ago, that most Americans feel poorer than they were a few months or a couple years ago.

 

This feeling and sense of loss is more damaging as it will convince them not to spend money and they whole economy will get slower.

 

I don't think I'd want to be retiring now and cashing in my stocks or retirement accounts.

[Guest MonkeySee]

I'm entering into a great depression round about now. I call it winter.

I think the Thais are feeling it, too. The way they are all bundled up, you would think it was zero degrees! I am loving this winter weather.

[Guest Steve1903]

MonkeySee is correct. I for one would happily watch a group of bankers go bungee jumping..........without the rope.

[Guest MonkeySee]

MonkeySee is correct. I for one would happily watch a group of bankers go bungee jumping..........without the rope.

This Madoff fellow, with his ponzi scheme that has robbed people of an estimated 50 billion dollar that he called a hedge fund, should be the first to do the ropeless bungee jump.

[Guest Astrrro]

I think there will be another Great Depression. The worldwide economy is in a negative spiral.

 

If you aren't working, have no savings, and no line of credit it won't be pretty.

 

Think intstead of shantytowns, folks will take on roomates.

 

For meals Ramen noodles.

 

Almost all spending is discretionary. You can use 20% less toothpaste and 20% less toilet paper.

 

 

[Guest Steve1903]

I have to say, when all is said and done, this depression is having little effect on me at all. I have no property to be devalued nor mortgage on the rise, I have no shares to worry about or pension fund to be sent plummeting nor have I any savings to speak of. I guess there are some advantages to being bankrupt.

[Guest fountainhall]

Times have changed.

 

Really? Ponzi - Madoff?

 

This Madoff fellow . . . should be the first to do the ropeless bungee jump.

 

That's too easy! The little I have set aside for the retirement I had expected to enjoy in 3 years time is now worth about half what it was a year or so ago. So I expect to work longer than I had intended. But I have the luxury of that choice. Those whose life savings were stolen by Madoff have almost nothing. The 'flying farang" way out is far too quick for him. He should suffer for a long, long time.

[Guest GaySacGuy]

How about death by starvation...slow starvation.

 

That is what a lot of us are facing, after seeing out nestegg shrink by 50% or more in the last few months. I figured to live quite easily since I have a governement (State of CA) retirement income, and a nestegg of stocks which I could call on for special needs, or to augment my income. But now, I don't dare draw any from the stock till they go back up...if they go back up. I was preparing to add a monthly stipend to my retirement, but that will have to wait.

 

Oh well, I get Social Security in just three months...and that will be a whopping $200. That is because all the time I worked in CA, I wasn't paying social security.

[Guest MonkeySee]

NEW YORK – Even Uncle Sam may get burned by Bernard Madoff. Investors who lost their fortunes in Madoff's alleged Ponzi scheme will end up paying far less in taxes and may even be eligible for refunds, according to accounting experts. By some estimates, the Internal Revenue Service could be out as much as $17 billion in lost tax revenue.

 

Read the full story at:

http://news.yahoo.com/s/ap/20081218/ap_on_...f_scandal_taxes

[Guest Astrrro]

Since we're talking about investments you might want to keep your eye on PMM and PMO. These are two "closed end" mutual funds that will be merged into "open end" mutual funds at net asset value in April '09.

 

Right now, they are trading at a discount of 9%. But last week I noticed the discount was 17% so I hopped on board.

 

Many closed end funds trade at discounts but it's no big deal because if you want to sell you will probably be selling at discount.

 

But here's a situation where you know the discount will disappear when the fund merges at net asset value not market price.

 

Now the net asset value of the fund could still go down, or it could go up.

 

These funds are both municipal bond funds so they should be held in one's taxable account, not in an IRA or 401K.

[Guest MonkeySee]

Can the younger generation do without some of the abundances we all have gotten use to and take for granted?

I do not know about the younger generation, but I am sure tightening my belt. I hate to admit it, but this season,I have not offed as many boys as I usually do. I do not eat out, as often, at farang-style establishments. Every little bit helps. You know BF said, a penny saved is a penny earned. Have your spending habits changed any?

 

[Guest Steve1903]

I just dont get how the bankers are STILL getting away with paying themselves huge bonuses. We as taxpayers bail them out to the tune of billions, they they pay themselves over a billion in bonuses despite having to be rescued and still I dont hear any of our politicians complaining. I dont get it at all.

[Guest MonkeySee]

I just dont get how the bankers are STILL getting away with paying themselves huge bonuses. We as taxpayers bail them out to the tune of billions, they they pay themselves over a billion in bonuses despite having to be rescued and still I dont hear any of our politicians complaining. I dont get it at all.

I don't get it, either. The car makers have to jump through hoops and have a plan, etc, etc. The bankers don't need to do a thing and can't even say what they did with the money. What a joke!

[Guest Astrrro]

Maybe it's cause Paulson's a banker. He'll do his best to make sure all is rosy on Goldman Pond.

 

Two Detroit bigwigs were Secretary of Defense. Charles "what's good for GM is good for Amerika" Wilson and Bob McNamara supposedly one of the best and the brightest.

 

Halberstram's "Best and Brightest" failed just as the smartest guys in the room such as Paulson also failed. But even though their policies may have been a disaster they all somehow retain great personal wealth.

[Guest MonkeySee]

I heard a report that a 65 year old Frenchman from a very influential banking family committed suicide. Sleeping pills were found by his side and his wrists were slit by a box cutter. I guess he was heavily invested in Madoff's hedge fund.

[Guest fountainhall]

He had over $1.5 billion of clients' funds invested!

[Guest xiandarkthorne]

I heard a report that a 65 year old Frenchman from a very influential banking family committed suicide. Sleeping pills were found by his side and his wrists were slit by a box cutter. I guess he was heavily invested in Madoff's hedge fund.

 

Is that the French way? The Romans fell on their swords while the Japanese slit their bellies.

[Guest MonkeySee]

Is that the French way? The Romans fell on their swords while the Japanese slit their bellies.

I have never heard if there was a French way. The French like the easy way out, and so maybe the sleeping pills are the way to go. With $1.5 billion on of his client's money on the line, this guy wanted to be sure he did it right. I guess that is why he did both the sleeping pills and slit the wrist.

 

[Guest laurence]

Is that the French way? The Romans fell on their swords while the Japanese slit their bellies.

 

The Romans did slash their wrists to do themselves in.

The French method is primarily hanging and firearms.

But certain Asians prefer the pesticide method or the charcoal method.