Like the illusion of Wall Street, with its vast and powerful investment banks, now shuttered, China too is an illusion perpetuated by the Globalists that gave us the 15,000 mile Caesar salad, poisoned cat food and lead based paint on babies' pacifiers. Like the illusion that money would come from thin air to always push housing prices higher, China has spent a generation pursuing its illusion. Pursuing an unattainable dream to be like the West, while 6000 years of its carefully shepherded top soil blows into the sea.
Posted: Sun Feb 13, 2005 1:28 pm Post subject: The Coming Peak Oil Grand Depression
The Great Depression which began in late 1929 and lasted for about a decade was the worst economic downturn in U.S. history, and one which spread to virtually all of the industrialized world. The coming Grand Depression will be no less far-reaching. The "roaring twenties" was an era when our country prospered tremendously, much like we have done over the last few years. And, like then, it was all due to wild speculation and inflated assets. In the 1920's, the U.S. came to rely upon two things in order for the economy to remain on an even keel: credit sales, and luxury spending and investment from the rich. Same thing today. Our consumer spending is not funded by an increase in income wages, but by an illusionary equity in our homes. In other words, all the inflation has gone into real estate prices. Prices have reached levels that make no sense in terms of traditional patterns and rules of thumb for valuation. A range of evidence suggests that at the market peak in September 1929, something like forty percent of stock market values were pure air: prices above fundamental values for no reason other than that a wide cross-section of investors thought that the stock market would go up because it had gone up. Now, real estate investors think the same thing of the housing market.
In particular, the FED's efforts to lower interest rates have caused an asset bubble to form around real estate. People tend to over-invest when interest rates are low and when interest rates are raised to stave off the inevitable inflation, the bubble pops. That process is under way as I write this. Throughout the years preceding the Stock Market crash of 1929, the Fed did just that. The Fed set below market interest rates and low reserve requirements that all favored easy credit. The money supply actual increased by about 60% during this time. The phrase "buying on margin" entered the American vocabulary at this time as more and more Americans over-extended themselves to take advantage of the soaring stock market. Today, it is the housing market, and to some extent the stock market again. It was in 1929 that the Fed realized that it could not sustain its current policy. When it started to raise interest rates, the whole house of cards collapsed. The FED is starting to raise interest rates now for the same reason--to cool off consumer spending/speculation and reel in the trade deficit.
One of our members, somethingtosay, suggested I "interview and learn from the people that lived and survived the great Depression of the 30's. Report back to this Web site on the wisdom they learned the hard way." Some of the following is from some old-timers I talked with recently, and the rest from interviews posted on the Internet. I will let the following quotes speak for themselves. It is a chilling account.
Quote:
Well, everybody went on relief, and everyone raised a big garden. We raised everything from peas to potatoes and onions, and the extra vegetables we had we sold to people who didn't raise one. We lived off that garden for some time, and it was a big help. Once a month they'd give commodities out. You'd get dried beans, pound of bacon, pound of butter, dried milk, and sugar, and depending on how big your family was, was how much you got; and since we had the cow, we would trade the dried milk for coffee to people who didn't like coffee. That was supposed to last you a whole month, but that was government surplus, and they'd have a place that they dished that out; and I tell you we were so poor we had a gas stove, but we didn't even have the money to hook it up. We also had an icebox and couldn't even afford ten cents a day to put ice in it. When my son was born I'd mix his formula and put it down in the well on the rope and every time I had to feed him I would pull the rope up and get the bottle, but we had no refrigeration and everything we needed refrigerated went across the street to my mom and dad's place. When the war started in 1941, a lot of jobs were left vacant when the men left for war, so unemployment virtually disappeared after that.
Quote:
Gas was sparse, so when me and a group of buddies would drive down a hill, we'd turn off the car so we wouldn't waste gas.
Quote:
Seemed to have just enough food to eat...no leftovers...had to eat everything on our plate. Things we take for granted now, such as water and heat in our homes was something precious in the depression. All farmers had to can food for winter and they ate out of gardens in the summer on a farm, there was no money and the people had to eat from gardens
Quote:
It has affected me all my life. It made a lot of people learn how to conserve.My dad could not find work so we went to live on the farm with my dad's parents. We had no money so when we needed something we had to "make do" or do without.
Quote:
The city was affected more than rural areas. We always had food and wood from the farm, but city people had very little food or wood. They had to collect coal that dropped from the trains. Lived on a farm and had plenty to eat because we grew everything moved from town to live in Smithfield MO on a farm so that they could grow crops and have food to eat.
Quote:
African Americans suffered more than whites, since their jobs were often taken away from them and given to whites.
Quote:
Every tear I saw my mother shed was over the lack of money. All we seemed to do was to, literally, count the pennies in the house among all of us. We fought over money almost all the time, my mother would go into a panic if she could not account for every penny. Not one cent was ever foolishly spent and not one cent ever went for anything that was not vital to life. The memory that I retain to this day (77 years old) is that of my parents crying, singularly and together, about money! I remember one dinner where my mother, myself and my brothers and sister sat down to a meal. The meal consisted of 3 boiled potatoes and one slice of white bread which we divided up amongst us. I noticed my mother was not eating and I asked her why she was not eating. She answered that she was on a diet. When I was about 50 years of age it hit me that she had not been on a diet but was giving up what there was to us!
Quote:
When I talk about the essentials of life I mean just that. The list is easy to put together and here it is:
Rent, food, but no ice cream, candy, baked goods; only the essentials, electricity, gas for the stove, clothing, medicine—and that was it. We walked everywhere and I do mean everywhere. If a trip was less than 5 miles we would walk it.
There are five things that seem to be predominating in all that I have read about the Great Depression:
1) There was not one single private or public institution that was up to the task of coping with the depression.
2) The United States suffered more than any country in the world since we were the most industrialized.
3) People had to grow much of their own food in gardens.
4) There was a mass exodus to the country to live with farm relatives.
5) Money was seldom seen.
Are we headed there once again as peak oil/gas inhibits our ability to grow the economy, provide new jobs, and feed--clothe--house the new comers? Even without peak oil, this seems to be in the cards. And without an abundance of cheap energy to grow our way out of it, the forecast for the future is ominous. _________________ A Saudi saying, "My father rode a camel. I drive a car. My son flies a jet-plane. His son will ride a camel."
Live in Arizona? Check out: http://sustainablearizona.org and read my blog.
Last edited by MonteQuest on Fri Nov 25, 2005 11:13 pm; edited 2 times in total
Joined: Oct 03, 2004 Posts: 565 Location: Washington State
Posted: Sun Feb 13, 2005 1:43 pm Post subject:
You would think that the 1920's were not so long ago that people would forget what happened. I think the bottom line was a redistribution of wealth, back toward the elites, like previous "fourth turnings". While you state there was a "mass migration" to farms, I would disagree. The biggest impact of the depression was the loss of family farms. Banks foreclosed and those with cash were able to buy them up by the score. I think my grandfathers only real disappointment in life was when he lost his farm during that time. The words of the country song sum it up well.
The family lost the farm and moved to town, Daddy got a job with the CVA...
Hope my property sells before the balloon bursts! _________________ This is where everybody puts profound words written by another...or not so profound words written by themselves
Highlander 2007
While you state there was a "mass migration" to farms, I would disagree. The biggest impact of the depression was the loss of family farms. Banks foreclosed and those with cash were able to buy them up by the score.
Quite so, a 1000 foreclosures a day during the worse times, but there was still an initial mass exodus out of the city to live with relatives on the farm. When the farms were lost, the people lived in Hoovervilles or rode the rails looking for work.
This massive transfer of wealth from the poor and middle class to the rich is about to happen once again. _________________ A Saudi saying, "My father rode a camel. I drive a car. My son flies a jet-plane. His son will ride a camel."
Live in Arizona? Check out: http://sustainablearizona.org and read my blog.
The quiet transition of Survivalists from society to the Wilderness is about to...Well...Happen.
I still say Cheese it when things start to look bad. _________________ If you pick up a starving dog and make him prosperous, he will not bite you. This is the principal difference between a dog and a man. ~ Mark Twain (1835 - 1910)
Joined: Sep 30, 2004 Posts: 975 Location: On one of the blades of the fan
Posted: Sun Feb 13, 2005 2:14 pm Post subject: May be so
Quote:
This massive transfer of wealth from the poor and middle class to the rich is about to happen once again.
But these events have a habit of radicalising the poor and waking up the apathetic. I don't think the rich iwll be able to sit it out in their gated communities.
Posted: Sun Feb 13, 2005 2:19 pm Post subject: Re: May be so
julianj wrote:
Quote:
This massive transfer of wealth from the poor and middle class to the rich is about to happen once again.
But these events have a habit of radicalising the poor and waking up the apathetic. I don't think the rich iwll be able to sit it out in their gated communities.
Yes, and without WWII, which we were snookered into, I believe you would have seen massive social unrest in the USA. How will we pacify the masses this time? _________________ A Saudi saying, "My father rode a camel. I drive a car. My son flies a jet-plane. His son will ride a camel."
Live in Arizona? Check out: http://sustainablearizona.org and read my blog.
Joined: Dec 04, 2004 Posts: 2407 Location: perpetual state of exhaustion
Posted: Sun Feb 13, 2005 2:19 pm Post subject:
The world used the war to get out of the depression last time. It would be a seductive way to do so again, with the added benefit of decreaseing the population. Anyone care to guess who the target of the next world war would likely be?
Posted: Sun Feb 13, 2005 2:21 pm Post subject: Re: May be so
julianj wrote:
Quote:
This massive transfer of wealth from the poor and middle class to the rich is about to happen once again.
But these events have a habit of radicalising the poor and waking up the apathetic. I don't think the rich iwll be able to sit it out in their gated communities.
What happens if they repackage it and say, we are at war and people have to make sacrifices? Or they are doing it to protect freedom. Think Americans will get it?
The world used the war to get out of the depression last time. It would be a seductive way to do so again, with the added benefit of decreaseing the population. Anyone care to guess who the target of the next world war would likely be?
Ah, the crux of the matter: But where will the energy come from to wage war? Answer: Out of the American standard of living. There is no other readily available source of energy, post-peak.
But to answer your question: China. _________________ A Saudi saying, "My father rode a camel. I drive a car. My son flies a jet-plane. His son will ride a camel."
Live in Arizona? Check out: http://sustainablearizona.org and read my blog.
It would be a seductive way to do so again, with the added benefit of decreaseing the population.
But it would be more effective to give everyone a car and lower the driving age. More people have died in auto crashes than all the wars combined since the Revolutionary War. _________________ A Saudi saying, "My father rode a camel. I drive a car. My son flies a jet-plane. His son will ride a camel."
Live in Arizona? Check out: http://sustainablearizona.org and read my blog.
Joined: Dec 04, 2004 Posts: 2407 Location: perpetual state of exhaustion
Posted: Sun Feb 13, 2005 2:42 pm Post subject:
Hey, no one says it has to make sense. Why is it they spend millions (at least here in Canada) to get people to quit smoking but make it ok to smoke pot???
Joined: May 22, 2004 Posts: 1437 Location: Ottawa, Ontario
Posted: Sun Feb 13, 2005 2:51 pm Post subject:
My Gram wrote:
Every morning Mamma made pancakes for breakfast. She used a starter from the batch she made the day before. No eggs were used... eggs were really only for special occasions like Easter and Christmas. (...) When it was cold Mamma would go into the shed off the kitchen and slice off pieces of pork hanging there. We always slaughtered a pig every fall and the frozen meat would hand on a hook in the shed until it was gone. She would cook it up and serve it for breakfast with pancakes and molasses. Most of the time, the men had eaten it all before we children got to the table.
My Gram grew up on the family farm, and they were relatively unaffected by the great depression yet from the above quote you can tell even the "well off" weren't eating peaches and cream.
Thanks for the interviews, Monte; as you mention, the Depression was a worldwide event, and these quotes reminded me of stuff I learnt from my Mum in England, about how her family fared in those times. My Mum was one of seven kids, and they lived in Hull, a big city in the North-East. My Grandad was unemployed, and my Grandma said that many nights when she went to bed she would not know how she was going to feed the family next day. Fortunately they had other relatives close by and everyone helped everybody else. Finally my Grandad managed to find work in another city, and made the trip, in advance of the rest of the family, to find a place to live and settle into the job. Unfortunately, he came down with the flu, but went to work anyway; the other fellows on the job "covered" for him, or he would have lost his job. During work-time, he lay in a shed on the worksite, tossing with fever, etc., and for two weeks or so, until he recovered, he was in danger of losing his job. He never forgot the kindness of his workmates.
My grandmother had a distant cousin who was not so fortunate. He set out one winter's day to walk across the Moors (in Yorkshire) to find farmwork. A blizzard came up, and he was never seen again. He must have frozen to death out there.
Well just a couple of Depression-Era stories from across the Pond.
One of the things that have changed dramatically since the Depression is oil distribution and production. During World War 2 the United States was the largest oil producer in the world. It profited enormously from the export of oil during and after the war. Now the U.S. is in a much different situation and war will only further weaken it. War is very expensive and we just don't have the resources we had back in the 40's.
Another issue is the proportion of industry in the U.S. during WW2. No other nation was even close so we were much better prepared to ramp up to massive production. The U.S. is now losing industrial capacity while many other countries such as China are growing rapidly. The single greatest threat to the U.S. is China. China controls much of the U.S. debt and has been building up its military.
It was very much the acceleration of the industrial age based on cheap energy that got us out of the Great Depression and it will be its fall that puts us back in.
The United States tried to deprive Japan of oil before entering WW2 to cripple Japan. It also used oil to bankrupt the USSR by exerting political power, an arms race, and knowledge of Hubbert's Peak to flood the world oil market with cheap oil as USSR production was peaking. The U.S. will go bankrupt when oil gets too expensive thereby being a victim also, doubly so since the dollar's value is tied to oil.
Joined: Nov 18, 2004 Posts: 215 Location: New Zealand
Posted: Sun Feb 13, 2005 3:16 pm Post subject:
Laurasia wrote:
Fortunately they had other relatives close by and everyone helped everybody else.
In discussions with older relatives, this is the predominant theme. My family lived (and some still do) in a very small coastal settlement, with very little outside input. They had gardens, fishing and everyone helped on the local farms for a share of produce and so lived very well - there was a definite sense of community.
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