The Great Depression Part 2? - Page 3

[slsurface]

Originally Posted by krankedyann

Raising taxes in an economic downturn is a decidedly recent idea. Now we have states going bankrupt in the middle of it all, too, because they have no clue how to manage money and cut back spending when tax revenues fall. So instead they just up taxes, making for more burden on the people, resulting in even more lost jobs..... it's a viscious cycle.

We've tried the opposite approach in Michigan for years and it hasn't helped. All we do is keep reducing spending until there's no more to give up. I don't know what the solution is.

[slsurface]

Originally Posted by krankedyann

I agree. I recently read in a newspaper article that in some states it's taking up to three months to get your first unemployment check, they're so swamped.

Yep. Here is Michigan, there aren't even enough state employees to handle the unemployment requests...all due to the cut-backs I mentioned in m previous post.

[slsurface]

Originally Posted by Amys1st

That is our feeling. DH and I made a decision several years ago (maybe 2 decades ago like velochic) that we wanted to be resourceful and raise our children to be resourceful. If I had a nickel for everytime someone looked at my like I have 6 heads for my frugal choices, I could settle the Redepression myself.

I totally agree. DH and I have always lived frugally, even in times of so-called plenty...DH was shocked last week when he and his coworkers started sharing how long it would take for them to be homeless and food-less if they were to loose their jobs. Apparently, NO ONE in my DH's office has any savings or food storage. This is crazy to me.

[slsurface]

Originally Posted by Violet2

And yet there is still a strong sentiment of 'stocks will go back up' and 'everything will be fine'. I recall, a few months ago, someone here called me stupid when I suggested it was time to get out of the stock market.

I cannot see how anyone expects a stock market recovery. The stock market boomed based on lies and swindles. For it to come back in my life time, we would have to lie and swindle some more. Although,historically we seem to do exactly that so who knows? But my trust in the system is broken and I will no longer give money or my future to cheaters and liars.

V

The problem is, there is no way for the average person to save enough money for retirement without investing in the stock market.

[beanma]

I just found this thread via "new posts", but I don't think this "economic downturn" is anything like the Great Depression right now. My mom grew up during the Great Depression and has told me stories of many out of work men coming to the farm just asking for food to eat. My mom's folks weren't well-off at all, but they always found a little job for the men and scraped together a little food for them. We may be waiting months for unemployment checks, but you don't see lines for the soup kitchen stretching for blocks.

People are definitely hurting and starting to hurt and worried about hurting, but the unemployment rate during the Great Depression was something like 25%-30% and we're nowhere near that right now.

[slsurface]

Originally Posted by tayndrewsmama

I think many are seeing more violence than they remember seeing previous years and that may be why there is the thought that it's just more violent than past 'bad times'. I asked my mom if she thought things were worse now than when she was my age and she thinks people have always been like this.

One thing to remember is that with today's media it's much easier for us to be aware of many more incidents.

Yes. The other thing about crime is that there are a lot more things like burglaries when the economy is bad...these things tend to be more noticeable because they happen to us, or our neighbor. For example, I knew that our local economy was getting bad a couple years ago when we were burglarized three times in one year - but had never had any problems in the 5 years prior.

[slsurface]

Originally Posted by beanma

People are definitely hurting and starting to hurt and worried about hurting, but the unemployment rate during the Great Depression was something like 25%-30% and we're nowhere near that right now.

Some cities have unemployment that high. Last summer unemployment was 28% in Lansing, Michigan. The numbers are much lower now only because peoples unemployment benefits have run out.

[p1gg1e]

Originally Posted by slsurface

Some cities have unemployment that high. Last summer unemployment was 28% in Lansing, Michigan. The numbers are much lower now only because peoples unemployment benefits have run out.

Last I heard the number was 12.5% were either unemployed or underemployed.

[JTA Mom]

Originally Posted by p1gg1e

Last I heard the number was 12.5% were either unemployed or underemployed.

There's no way to count underemployed people. Those never get counted in the unemployment numbers. So everyone who has had their hours cut or pay cut aren't counted. Those no longer drawing unemployment don't count. So that number is a lot lower than it should be.
For the pp who mentioned 25%+ unemployment during the GD--those happened a couple years after the stock market crash. So, technically speaking, we could still be on a downward spiral in that aspect. It's not like overnight a quarter of the population lost their jobs. And it won't happen that way even now. I think the peak was 1933 in terms of badness, so we have what, 3 more years left before hitting that number? Also, the demand for food banks is through the roof. A lot of people are NOT getting help because there's nothing to give--therefore no lines.

Ami

[4kidlets4me]

Originally Posted by beanma

I just found this thread via "new posts", but I don't think this "economic downturn" is anything like the Great Depression right now. My mom grew up during the Great Depression and has told me stories of many out of work men coming to the farm just asking for food to eat. My mom's folks weren't well-off at all, but they always found a little job for the men and scraped together a little food for them. We may be waiting months for unemployment checks, but you don't see lines for the soup kitchen stretching for blocks.

People are definitely hurting and starting to hurt and worried about hurting, but the unemployment rate during the Great Depression was something like 25%-30% and we're nowhere near that right now.

I think the difference it these days there is unemployment checks, food banks, food stamps etc. there is alot more social services. However if/when the gov runs out of funding for these programs then what? Food banks in my area are being overrun with requests for help. The county I live in is at 13% unemployment. Also I think people would rely on credit cards for basic things like food even if they knew when the bills came in they would not be able to pay it. Like a pp said 25% unemployment did not happen overnight it took several years to get that bad we are just beginning this crisis.

[p1gg1e]

Originally Posted by JTA Mom

There's no way to count underemployed people. Those never get counted in the unemployment numbers. So everyone who has had their hours cut or pay cut aren't counted. Those no longer drawing unemployment don't count. So that number is a lot lower than it should be.
Ami

I believe that number is from people who found employment while on unemployment. Just that its a general number and its quite high already.

[velochic]

When I was talking about violence, I meant VIOLENCE in the respect of coming out of it alive. In the Great Depression, you might get a kidney punch and your wallet stolen. People simply didn't tote guns around back then (GD) and certainly not hand guns the way people do today. Honest people had shotguns or rifles for hunting, and it was difficult for dishonest people to get assault weapons (and I put handguns in that category too, JMHO, because I see no need for them except to kill another human being... different subject but relevant to the conversation, I think). Violence existed, of course, but it usually consisted of getting beat up a bit and your things stolen. Today... I hear every morning about someone getting shot for looking sideways, home invasions where 64 year old Maude was shot for no apparent reason and her old tape deck stolen, etc. They are senseless killings that just didn't happen outside of organized crime during the 1930's. I have read PLENTY about the GD and I realize that violence existed... it's a whole 'nother story today. Nothing can convince me otherwise.

[Violet2]

Originally Posted by beanma

I just found this thread via "new posts", but I don't think this "economic downturn" is anything like the Great Depression right now. My mom grew up during the Great Depression and has told me stories of many out of work men coming to the farm just asking for food to eat. My mom's folks weren't well-off at all, but they always found a little job for the men and scraped together a little food for them. We may be waiting months for unemployment checks, but you don't see lines for the soup kitchen stretching for blocks.

People are definitely hurting and starting to hurt and worried about hurting, but the unemployment rate during the Great Depression was something like 25%-30% and we're nowhere near that right now.

You must realize we are just starting GD v.2.0. In 1-2 years we'll look quite a bit like the GD. And structurally and in many ways, statistically this is very much like the beginning of the last GD.

V

[Violet2]

Originally Posted by slsurface

The problem is, there is no way for the average person to save enough money for retirement without investing in the stock market.

There is no retirement. Retirement is a myth for anyone living right now. And even if the stock market were to rebound in 5 or 10 or 20 years the losses are so monumental that it will take twice as long to regain what we had to start with. Putting me at like 45 or 50 just to get back where I was at 35.

Even if the stock market comes back, I do not have enough time to save for retirement. And I doubt you do.

Dollar cost averaging is not going to compensate for the lost money and the lost time.

We are going to be the generation that lost everything and scrambled until the day we died to get it back.

V

[Tradd]

Home from work and reading your comments about the story about my coworker. I realized I'd forgotten to add one thing: this is a woman in her early 50s, with 3 grown children, and you would think someone who has been on the earth that long would know better, particularly with our shaky industry and things not looking too good at her DH's company.

[Denvergirlie]

Originally Posted by slsurface

The problem is, there is no way for the average person to save enough money for retirement without investing in the stock market.

What's an average person?
What's an average retirement?

Also, going to have to consider that the level of consumption is droping, people are rethinking all choices. More and more families will move away from the idea that multiple generations don't live together.

The modern idea of retirement is very new... 60+ years ago, many of the elderly lived with their children/ other family members until they died. The idea that retirement is some golden age of golfing, traveling, club med and puttering in the back yard all day is new and not really the norm.

Heck back then there really wasn't retirement at all, many worked until they were physically unable to move from the bed and even then they still had chores like sewing, knitting and childcare.

Like everything else in the recent past, expectations are going to be revised to what is realistic.

As for stocks... normal savings accounts, bonds, money market accounts are pretty darn safe (as safe as any fiat based money system up to it's eye balls in debt and facing inflation due to poor monetary policy from the Fed).
We have our expenses rather low, save about 50% of our take home. If we didn't have a dollar today in savings and just had to save cash for the next 30 years until retirement age of 65, we could easily have $500K set aside; And that isn't counting on any interest income from a simple savings account.

I do acknowledge that not everyone has the ability to save what we can at this time, and I also recognise that we very well might not make as much as we make now in the future, but we could lower our expenses even further and we can adapt.

I think that's most important above anything else, be willing and able to adapt to the changing enviroment instead of harping about the past. The past can not be changed, only one's future can now be addressed.

[Juvysen]

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[slsurface]

Originally Posted by Violet2

There is no retirement. Retirement is a myth for anyone living right now. And even if the stock market were to rebound in 5 or 10 or 20 years the losses are so monumental that it will take twice as long to regain what we had to start with. Putting me at like 45 or 50 just to get back where I was at 35.

We are going to be the generation that lost everything and scrambled until the day we died to get it back.

Oh, trust me. I already know this. As a gen-xer who hasn't even gotten her career started in her 30s, because she's been in graduate school for a decade, I know I'm screwed. My only hope is that I die early like my father and his parents. My poor mother also knows that she's going to have to work until she drops. She was a SAHM who ran her own business when my sis and I were kids. We were always struggling just to survive, so at the end of the day there was no money left for my parents to invest in retirement.

Denvergirlie, my comment was made to draw attention to the fact that few people have guaranteed pensions anymore. The rest of us are supposed to be managing our own retirement savings in 401K and such. The problem is, that these things are predicated on the notion that the economy is strong and growing and that your investments will make a constant return. Since it is doubtful it will ever be strong again, I doubt I will ever save enough to retire even by age 70. Realistically, I may never be able to "retire" to even part time work. This is something that depresses me greatly.

For the record, I grew up with both sets of grandparents living with us. I've always known that DH and I would have to care for his parents and mine in their old age. And I hope that my DS will do the same for us in the future.

[Juvysen]

You know, I heard a commentary the other day on NPR that was all about "well, thank goodness we didn't end up completely privatizing social security or there's a lot more of us that would be completely screwed right now..." basically. I hadn't thought about it but, ouch...

[Violet2]

Originally Posted by Juvysen

You know, I heard a commentary the other day on NPR that was all about "well, thank goodness we didn't end up completely privatizing social security or there's a lot more of us that would be completely screwed right now..." basically. I hadn't thought about it but, ouch...

SS is meaningless for all but the boomers and up. Younger than the boomers and there is not enough money for you. We get our SS statements every year 'by the time you retire, unless something changes, there will be no funds available for you.'

V