Friday, December 11, 2009


"The government is running out of ways to help the economy as the US faces major issues regarding credit and employment ahead, banking analyst Meredith Whitney told CNBC.

"I think they're out of bullets," Whitney said in an interview during which she reinforced remarks she made last month indicating she is strongly pessimistic about the prospects for recovery.

Primary among her concerns is the lack of credit access for consumers who she said are "getting kicked out of the financial system." She said that will be the prevailing trend in 2010...

...The solution, she said, is for the government to take proactive steps that will give consumers more money to spend.

"I don't think you can cut taxes enough to stimulate demand," Whitney said. "For a 2010 prediction, which is so disturbing on so many levels to have so many Americans be kicked out of the financial system and the consequences both political and economic of that, it's a real issue. You can't get around it. This has never happened before in this country."


(H/T The Coming Depression)

"This has never happened before in this country." This is true on so many levels. Sure, we've been through a depression or two before so why is this different?

I've been thinking about this. How do the people of today compare to the generation that went through the Great Depression of the 30's? I'm 51 years old so I knew a lot of people that went through this time, from family to friends. My parents were both children in the 30's. The one thing that has always stood out in my mind was that times were tough but so were the people.

For working class people in the beginning of the 20th century life was not all that much different than it had been throughout most of recorded time.

A large percentage had either lived on a farm and produced their own food or lived with some one that had. This is no longer true. Food comes from the store processed and sometimes cooked for us.

My Dad lived in North St. Louis, part of what at the time was one of the largest and most advanced cities in the nation. His family had an outhouse. Of course, it was a two holer so they were justly proud. How many in America today use an outhouse as their primary toilet, in even rural areas?

Heat came from a furnace that burned coal. The coal had to be shoveled in at regular intervals and was delivered by coal chute into the basement. If you wanted heat you had to man the shovel. Unless you just had a stove in your living area. My dad talks about burning the floor in the kitchen as fuel just to stay warm.

My Mom lived on the South Side. Her grandma raised rabbits in the backyard for food. Again, this is in the City of St. Louis.

When I was a kid all of my Great Aunts lived in the city. Because of their having grown up on the farm around the turn of the century they still kept to the old ways. They had a room in the basement that was always full of canned goods and other supplies. They washed clothes by hand in a big copper kettle over a burner in the basement and hung them out to dry. They paid their bills in cash and had no debt. They always knew the economy could fall apart and they were going to be ready.

All of the older people in my family, even though they had lived in an urban environment most of their lives never lost the sense of self reliance that so marked their generation. These were tough people, physically and spiritually. They remained the product of life as it had been lived for centuries, before cheap oil changed everything. They expected life to be hard and didn't complain. They were the last of their kind, the greatest generation.

Today we are facing an economic cataclysm that has the potential to dwarf anything that has come before. Are we prepared? I don't know, let me go talk to my analyst and see if I've worked through all of the issues that my parents caused during my childhood.

Let me make sure that I've got my latte and that the battery on my IPod is charged. Oh, and this needs to be over by 4 o'clock because I have an appointment with my personal trainer.

I've got a light bulb that needs to be changed. Could you call someone about that? Thank you, dear.

We are the weakest generation. Most people can't cut up a chicken from the grocery store much less kill and clean an animal. We don't know where food comes from or how to find water if it doesn't come out of the tap. We've never worked in a physically punishing job and seek medical attention for the slightest scratch. We've been coddled and taught that the world revolves around us. We are special, the product of a generation that believed their kids would never have it as tough as they did. Our parents were wrong.

I believe that we are about to make a swift and violent change in direction. We are returning to a standard of living much closer to the historical norm, much closer to the way our grandparents lived. As the economy continues to crash and the availability of cheap oil becomes a thing of the past we are going to have to learn to fend for ourselves. We will need to be self reliant in a world without modern technology to carry us through. As James Kunstler says, "A World Made by Hand".

And we have not been prepared. We will focus on ourselves at the expense of others. Our self centered behavior will put us at each others throats, scratching and clawing for the basics of life. Because we're special, we deserve it. We won't be able to objectively assess our situation and make rational decisions to insure our survival because we'll be to busy whining about the unfairness of it all. Because, in the end, all we are and have ever been is a generation of self important, whiny, special little losers, reliant on advanced technology to even use the toilet.

Ms. Whitney is right. This country has never been through anything like this before. Prepare yourself and your family and friends for the unthinkable. Prepare to lose 100 years of societal evolution over a very, very short period of time.

Think real hard about all of the areas that cheap oil touches in your life. The clothes, water, food, tools, fuel, communications, furniture and damned near everything else. Read about this country in the time period between 1870-1890. This is where we are headed. The time when steam was king and most people were responsible for producing the clothes they wore and the food they ate.

Think how you are going to survive the trip backwards 150 years into the future. If you don't prepare yourself now you won't make the trip. You will end up buried in an unmarked grave along the trail, just as so many pioneers did before you.

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