Saturday, December 5

I can see the future

You can too, it’s not that hard. No, I’m not psychic, I’m just observant. All it requires is paying close attention to history and how it repeats itself over and over.

Two years ago a friend and I were talking about the economy. You know, two middle aged women sitting around shooting the breeze. It’s seemed really strained we observed, and when the housing bubble bursts, it will be bad I opined. You don’t have to be an economist to see that coming. We did. When I hear government analysts and bankers saying with (almost) genuine surprise they didn’t see this coming, I know it’s bullshit.

About a year ago I was watching a show on the Discovery channel about the construction of the world’s tallest building in Dubai. How can they possibly afford, justify and maintain such an expensive monstrosity I wondered. There was an aerial shot of Dubai with tall condos and office buildings on either side of a main street and man made islands with rows of high priced houses I thought, oh look it’s a ghost town. Looks like I was right. The greedy little country is going broke.

Our economy is struggling but we’re are told it’s not that bad, it’ll be over soon, just go out and buy more stuff that will help. That’s how we recovered from the terrorist attack of 9/11 and it worked, right?

I got news for you kids, the depression -oops I mean recession, mustn’t use the D word, is not over by a long shot. When the economy does recover in say, 5 to 10 years from now, it won’t be anything like it was before. History shows us that great Empires rarely rise to their previous glory after such falls. Nothing new there. Read “How Empires Choose to Fail” by Jared Diamond and you’ll see what I’m talking about.

The government gave the airlines a huge bail out because of a week of grounding after 9/11 and how did the industry handle the crisis? Many airlines went bankrupt (and didn’t repay the loan -sorry) and CEO’s walked away with big bonuses while thousands of workers lost their jobs. Meanwhile consumers are angry at almost no protection from increasing prices and shoddy service.

Sound familiar? Let’s see, the big failing banks were given bail outs with little oversight, are continuing the same practices that caused the problem in the first place and shafting consumers by jacking up fees and interest rates. It will be another or two years before new regulations meant to protect the consumers from these predatory practices take effect.

See? It’s not that hard to predict the future because it’s already happened in the past.

No comments: