The Recession of 2008: Stock Up on Rice & Beans Now
86
Is Wall Street On Crack?
For the past year, my 401k has been tanking, the price of gas and home heating oil has been steadily rising, the price of food has been rising, the corporation I work for laid off about half of its employees, and I have been unable to get even one person to look at the house I am trying to sell because at least half the homes on the block where it is located are boarded up and in foreclosure. The homes would be sold at tax sale, but no one wants them, not even investors, because hardly anyone in that town has a decent job and renting out houses has become deeply unprofitable. The biggest financial institutions in the US are losing billions, yes, billions of dollars, and are holding their hands out for help from places like China and the Mideast.
Meanwhile, Wall Street surges up or down by two or three hundred points, depending on, well, on what? I don't think they even know anymore themselves. We're doomed! No, wait, we're saved! No, wait, we're doomed! No wait...
Okay, let me simplify this once and for all: We're doomed.
In the past, the Fed has been able to staunch the bleeding when a temporary crisis hit by infusing money into the system or cutting rates by a half a point or less. But this crisis is a different animal altogether. In the past, panics were just that: panics. The market was fundamentally sound but for whatever reason investors panicked and the market plunged temporarily. The Fed came to the rescue, and the market regained its composure.
Those panics were based on fears of what might be happening though. This panic, the one we see daily on the news, is based on what really is happening. Millions of people really are losing their homes and their jobs. Christmas was a bust for retailers because people in the US really don't have discretionary income anymore. Even people who have jobs and a home are struggling to heat that home, get to work, and feed themselves. These are facts, not fears. They can't be fixed with financial sleight of hand.
If America was a person instead of a country, it would be the kind of person who is in bad trouble with payday loan places. America is barely paying the interest on what it owes to its lenders in China, the Mideast, and Europe. The dollar is falling not because people are afraid, but because the dollar is not worth very much. It is backed by no industry to speak of and an ever-widening trade gap. When Citigroup, faced with billions in losses for 2007, took a loan from a wealthy Mideastern financial group, the loan was made at 12% interest. The largest financial institution in the US took a survival loan at a rate even I wouldn't accept. That's not good.
We can't get back to where we were without a major and painful correction. In fact, we can't get back to where we were, period. Karl Marx predicted that capitalism was doomed to eat itself; that built into the very structure of laissez-faire capitalism is the means of its own destruction: Greed. Profits cannot get bigger every year indefinitely. At some point, and that point appears to be now, the whole system gets top-heavy and falls down. No one is left with any means to buy the products being produced. An elite few hold all the capital, and the rest of the people, well, let's not go there yet...I think we still have on last fighting chance.
I think our only hope at this point is to stop being consumers, however painful this may be, and elect someone as President who is not the delusional inbred spawn of a former CIA, aka Satan. We will have to take conservation seriously, if only for our own personal survival. We will have to quit buying poisonous, badly-made crap we don't even need from China, and start supporting local business, farming, and industry. We will have to actively demand change, every day. We will have to get involved.
Financiers will tell you that FDIC insurance was created to prevent another Great Depression from ever happening again. That type of Depression has indeed been prevented. But that doesn't mean a financial catastrophe of a completely different type can't happen. The world is watching our financial and political situation right now for a reason. We should be watching it too, and speaking out.
Share it! — Rate it: up down [flag this hub]
Comments
Thanks Bud! I'm a notoriously gloomy person, I can always see the dark cloud billowing around every silver lining. Thanks for stopping by ! I really enjoyed your hub, I'll be back!
hmmm rice and beans are ok, but Little Friskies more economical:-) We agree on which way the wind is blowing anyway:-)
I think the correct food choice would be "wheat." Buy now though it is bound to go up in price when everybody realizes it is the commody to have.
yes. we're doomed. they are trading stuff that has no real money behind it. the things CEOs do to try to continue to enhance profit in the face of economic destruction of the american population at large, like lays offs, benefit removal, offshoring and outsourcing DIRECTLY contribute to the worsening situation.
There's more bad news to come. But we're headed for a big adjustment to reality, not a depression. The trillion dollar war in Iraq,the Bush tax cuts and the subprime mortgage fiasco have put us behind the 8-ball for a while. But we'll come back.
maybe.
Wow, thanks for stopping by everyone. Bud brought friends! I do hope we'll come back. I have my doubts. I think the US needs someone with the vision to recognize and put money behind our economic role in the world now that the world has radically changed. It could be green energy and vehicles if anyone had the guts and the vision, but I'm not holding my breath.
Unfortunately, it seems we humans need to have this kind of wake-up call before anything will change. I noticed people talking about locally grown produce, and these are people who would never have thought about that before. I buy local as often as I can and make my own cleaning products from natural ingredients. I work from home and save on using gas to commute. Plus, I have a fuel efficient car. These are only a few of the steps I take to reduce consumption. I see others doing the same and can only hope it really does turn us around in the long run.
I agree. It seems like for once the public is ahead of the government in this one--though not very far ahead. I think that brilliant $600 stimulus package will go right into most people's savings accounts or furnaces.
You've got an excellent hub here! Well-written and extremely informative.
You've got it in one about greed and topheaviness pulling us down. We've got one shot here, and that's:
a) stop the mentality of greed by changing peoples' mindsets about the supposed joy of getting something for nothing, and specifically about how to give value to get value, in ways that are actually personally worthwhile, rewarding and fun. Change that, and we can stop the greed from ordinary people and recover economically as a country - and as a world. I'm working to do that on the Hubs, giving out information about how to do that, with hubs like this one: http://hubpages.com/hub/How-to-Create-Excellent-Mo
b) demand accountability from our government. We may be a bit too late for that actually, especially as they blow half the income tax on military and train them for "urban warfare" while taking our guns away. Sound to you like they're getting ready for something? I wonder what it could be.
c) fix the topheavy nature of our business sector, and the control of the means of production at the whimsy of the rich, by collaborating commercially on the internet, developing new ideas to work around that, and keep a topheavy corporate sector from falling over... onto all of us.
I'm working on all three. I'm giving out informaton left and right on the Hubs to help people shift their attitudes and perceptions about what giving value is like, and how it can be a plus to be sought after rather than a minus to be avoided. I'm also creating a couple of much-needed internet startups that will accomplish b) and c) in new and devastatingly-effective ways with new technologies. We all do what we can.
You may want to search out the topic of sovereign citizenship if you're not already familiar with it - which is unlikely.
Thanks for joining my "fan club" as my first fan. We have a lot of interests in common, from your tag cloud. You may want to keep current with my Hubs as I add them, as much of the information I have is relevant and necessary, yet no-one seems to have heard of it anywhere.
Be well,
- Satori
Wow Satori, good comment. I will look at your hubs more carefully--I really appreciated the answer on HTML--you were the only person who answered my question on that, which shocked me. I thought lost of people here would know how to use it. I will seach 'sovereign citizenship' and see what that is.
I have this one job writing for a guy who has a website that promotes Web 2.0 sites and tools and MLM and stuff like that. The pay is steady, but the sites are so junky and annyoying that everytime I finish a batch of copy for him I think about letting the job go. To me, those kind of sites sound like the same "something for nothing" mentality that rules corporate America, only on the individual level. I thought from looking at your titles that you were into that kind of thing.
I will look again. You obviously are a smart person and I'm always looking to learn something new. Thanks again for an excellent comment!
Reading this again, I again realize the perception shown in the hub. Yes, beans and rice (not wheat) are a good combination. Also, a case of tuna (www.vitalchoice.com). - And boxes of quinola. And have a bit more faith – the stock markets are going up.
Every human has some greed. It's a big problem when a majority is myopic and refuses to acknowledge their greed.
Incidentally, all food prices are going sky high because we're decreasing grain production in favor of growing ethanol - - which is a political pay-off. Your tax dollars at work! But don't think any big problems are planned. Regarding moves by governments and large organizations: Always choose stupidity over conspiracy, incompetence over cunning.
How green I am! I have had a hybrid auto for 8 years. Plan on trading it for a new - - hybrid of course.
My inlaws have a hybrid too Bud--they love it! Thanks for the positive spin--I need that sometimes for sure (0:
Increased ethanol production is one reason food prices are going up, but there are other significant factors at play as well:
1) booming economies in countries like China and India are creating a burgeoning middle class who demand more and better food,
2) high energy/fuel costs translate into high manufacturing/transportation costs, and
3) huge increases in the price of raw materials to food processing factories.
Thanks for your comment and the additional pressureson food prices. Glad you stopped by Maliengus. (0:
An excellent commentary and one with which I fully agree. We are of much the same mind on this. It is good to see more and more people with the blinders coming off. How does it go? The first step toward recovery is admitting that you have a problem. I am just afraid that the consumer delirium prevalent in America and now much of the world has gone past the point of no return. People in the U.S. have become so complacent and addicted to the wasteful lifestyle that they flatly refuse to acknowledge the brick wall they are about to collide with.
Yes, I think more people are starting to see the truth about our situation. This hub continues to get more hits than any of my other ones, way more, which surprises me. But I think lot so people now sense that we are in for a very rough ride. They are looking for validaton of what they see happening with their own eyes because the media just lies and lies all day and all night.
You are probably correct. Unfortunately, barring some sort of global epiphany, I am afraid it is too little too late. Time will tell. Meanwhile, keep at it. Your positive input may hope to motivate that small segment of humanity that may possibly survive into the future.
working
budwood says:
5 months ago
Wow, PGrundy, you're almost as optimistic as I am. My take is that a large percentage of people who control USA finances are myopic - if not true intellectual midgets. Oh well, I suppose that it could be worse - I could be in charge and then you'd see some real problems as I feathered my nest!
- - And also, thanks for your kind words regarding "Bud's Market Observations". I appreciate hearing from you.