Thursday, November 20, 2008
Depression 1.0 Didn't Happen In One Day
For eleven months now, I've been sounding the alarm about the deterioration of our financial system.
I have more than 400 posts in the Depression 2.0 category alone. This doesn't even count the scattered Bank Collapse Watch posts.
Apparently, brainwashed by movies and TV, people expect Depression 2.0 to come along like the start of a fictional adventure, nice and neat and clear.
Life doesn't happen that way.
Depression 1.0 didn't happen that way.
The opening credits for Depression 2.0 have been running since January. The symphony has been warming up during those months to begin playing its dirge.
Yesterday marked the start of Depression 2.0. The opening credits are over. The symphony is now playing its threnody.
Nothing dramatic and sudden needs to happen after this point.
All that needs to continue is the slow grind of falling earnings, falling stock values, continued layoffs, plummeting consumer sales, and state after state declaring budget emergencies as tax revenues fall and social service budgets balloon.
CNBC can continue to avoid using the word "depression" until the market hits zero (don't worry; it won't do that -- although the end result will feel like that).
All of you can avoid using the word "depression," even after your job is cut and even after your Unemployment Insurance runs out (and it will, despite extensions).
At some point, reality will finally and ruthlessly grab you by the throat and make you cry Uncle.
I'm not going to give any prescriptions for getting out of this. That's up to the next Administration (which will flail pointlessly for half of its term).
The only advice I have is this:
1) Have a cellphone that can give you excellent access to the Internet. The Internet is now your lifeline.
2) If you need to upgrade any tech at home, do it now, but don't be extravagant in cost. If your PC is two years old, get a new one. Buy the most powerful one possible, but not top price.
3) If you have to get rid of cable TV, keep the broadband Internet connection. You can catch anything you miss on TV online now. If you don't have a WiFi router, get one now. Don't lock your Internet access indoors.
4) Even though cash won't be worth shit, it's better than having gold. Gold will be vulnerable to predation. It will mark you as one of the affluent. You don't want that.
5) Get a hand crank radio/flashlight combo.
6) If you have pets, watch for sales on their food, then swoop down and stock up.
7) While you still have health insurance, get any dental problems resolved. Toothache shouldn't be added to upcoming misery.
Depression 2.0 is different than Depression 1.0. Depression 2.0 has been brought on by unprecedented fraud. This isn't a bubble bursting. This is a drug addict who has overdosed and is trying to be revived in the E.R.. Even if the addict survives, there's still lots of rehab to go through.
Reference: Great Depression 1.0 Timeline
The Dimensions Of Our Doom