While reading Frederik Pohl’s autobiography, The Way the Future Was last night, I was struck by the following remarks he made in the first chapter:
Hoover did not plant the seeds [of the Great Depression], they were sown over the boom years of the 20s, in easy credit buying and mad stock swindles
I realize that people have been calling what we are in a recession and not a depression (and they are very careful to do this). But what struck me about the above statement is its strong parallels with our current situation. This recession was sown over the boom years of the late 1990 and early 2000s (especially in the real estate market); in the easy credit that made people think they could afford houses they couldn’t actually afford; and in mad stock swindles like we’ve seen at some of the big financial institutions that have gone under, to say nothing of the Madoffs and Stanfords of the world.
Of course, we can’t call this a depression since we have social security and unemployment and welfare and all the other social aid that folks in the 1930s didn’t have. But come on. Set those things aside and who are we really kidding?